This Week in Biotech #52
Catch up on the latest biotech breakthroughs and upcoming trends (May 9-15, 2025).
Hi and welcome to This Week in Biotech by Biotech Blueprint, edition 52.
🌟 A few updates from Biotech Blueprint:
New: Weekly video recaps. I’ll be following up each Friday morning newsletter with a short video recap. These videos break down the top biotech stories from the edition: what’s happening, why it matters, and what to keep an eye on. You can find them on YouTube, Spotify, and Apple Podcasts.
Biotech Blueprint is now a podcast on YouTube, Spotify, and Apple Podcasts.
We’re diving deeper into innovation, strategy, and the market forces shaping biotech, with timely conversations and thoughtful guests.Coming up: an expert on the future of animal research, and an industry recruiter weighing in on AI, soft skills, and the current job market.
And most importantly, welcome Erin! You may have noticed Erin Mihealsick co-authoring recent posts. She’s a recent PhD graduate from Johns Hopkins and is now exploring a career in medical writing. It’s been great having her on board, and I’m excited for you to read more of her work in the weeks ahead.
THIS WEEK’S KEY TAKEAWAYS 🔑
President Trump revived the “Most Favored Nation” pricing model in a new executive order aiming to lower Medicare drug costs. The plan calls for benchmarking U.S. prices against those in other developed countries. Trump claimed it could cut prices by up to 80%. But the order lacks enforcement, funding, or a timeline, and markets shrugged it off after officials reassured investors.
Meanwhile, U.S. drug prices remain the highest globally, nearly 3x more than in other nations. Unlike other countries, Medicare is barred from broad price negotiations, giving U.S. companies far more pricing power.
Markets broadly recovered thanks to strong earnings and cooler inflation data, with the S&P 500 turning slightly positive for the year. But biotech continues to lag: Moderna, UnitedHealth, and Bio-Techne are among the year’s worst S&P500 performers. Halozyme sank on fears its combination therapies could soon face Medicare price negotiations, while Biohaven plunged 22% after the FDA delayed a decision on its rare disease drug troriluzole.
On the M&A front, Bluebird Bio surged over 50% after renegotiating its buyout deal to avoid bankruptcy, and GSK acquired Boston Therapeutics’ MASH drug for $1.2B upfront. Meanwhile, Novo Nordisk signed a $2.2B collaboration with Septerna to expand its obesity pipeline, and AbbVie teamed up with ADARx on next-gen siRNA therapies.
In clinical updates, GSK and iTeos scrapped their TIGIT program after weak phase 2 results. Vaxart reported early success with its oral norovirus vaccine, and Apogee’s asthma drug APG808 showed promising biomarker suppression, potentially rivaling Dupixent with less frequent dosing.
The FDA also plans to release new vaccine guidelines to clarify regulatory expectations, part of a broader effort under CBER Director Vinay Prasad to bring more consistency to biologics oversight.
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MARKET UPDATES
🔹 The S&P 500 closed slightly positive for the year on Tuesday, May 13, up +0.08% YTD, erasing earlier losses after a 21.7% rally from April lows. Strong earnings and cooler inflation data helped lift sentiment. But while the broader market bounced back, biotech continues to lag. Among the 10 worst-performing S&P 500 stocks year-to-date are three biotech-related names: Moderna (MRNA) and UnitedHealth Group (UNH) tied for the bottom at -38.7%, while Bio-Techne (TECH) is down 28.1%. West Pharmaceutical Services (WST), a key drug delivery supplier, also made the bottom 10 at -34.1%.
🔹 Halozyme Therapeutics (HALO) fell sharply this week following downgrades from Morgan Stanley and Leerink Partners. The moves came in response to new draft guidance from the Centers for Medicare & Medicaid Services (CMS), which could accelerate the timeline for Halozyme’s combination products to face Medicare price negotiations. While Halozyme maintains that its ENHANZE technology provides added clinical benefit and should not be subject to early negotiation, analysts cited increased uncertainty. Morgan Stanley lowered its rating to Equal Weight with a $62 price target, noting the guidance “creates too much uncertainty” to remain bullish ahead of final CMS decisions expected later this year.
🔹 Bluebird Bio’s (BLUE) stock surged over 50% this week following an amended acquisition agreement with the private equity firms Carlyle Group and SK Capital Partners. The original deal aimed to acquire Bluebird and advance their gene therapy portfolio after the company has faced ongoing financial challenges. However, slow shareholder participation to tender their shares put Bluebird at serious risk of bankruptcy. The revised proposal gave shareholders the option of $5 cash per share or the previously agreed upon $3 cash upfront and a contingent value right of $6.84 per share. The new, more favorable deal has caused the company’s stock to surge, reflecting renewed investor confidence in the acquisition.
BIOTECH/PHARMA NEWS
🔹 On Monday, May 12, President Trump signed an executive order aimed at lowering the cost of prescription drugs in the U.S. It revives an old proposal to base Medicare prices on what other developed countries pay, a system known as the “Most Favored Nation” model. Trump said the move could cut prices by as much as 80%, pointing to examples like Ozempic, which costs ten times more in the U.S. than abroad.
A few days later, a top aide to HHS Secretary Robert F. Kennedy Jr. said that GLP-1 weight loss drugs like Wegovy and Zepbound would soon be priced at the same level as the lowest-cost country globally, potentially as low as $100/month. He emphasized that Americans shouldn’t be charged multiples more than other nations for the same medications and that the administration is prepared to use “every tool in the tool belt” to enforce the new pricing directive.
The order gives trade officials 30 days to identify international price points for certain Medicare Part B and D drugs. But there’s no clear enforcement, no new funding, and no timeline for when or if it would take effect. Investors seemed unconcerned: drug stocks dropped briefly, then rebounded after officials signaled that the industry wouldn’t be hurt anytime soon.
Prescription drugs remain far more expensive in the U.S. than anywhere else. Americans pay nearly 3x more for brand name medications than patients in other countries. The U.S. allows drug companies to set and raise prices freely, while government programs like Medicare are often barred from negotiating, especially for high cost drugs in protected categories. In other countries, if the government doesn’t get a fair price, the drug often isn’t covered at all. That gives them leverage the U.S. lacks.
This latest executive order may generate headlines, but it’s unlikely to lead to lower prices without action from Congress. A similar attempt in 2020 was blocked in court. President Biden’s Inflation Reduction Act gave Medicare limited power to negotiate a few top-selling drugs, but those changes won’t kick in until 2026 or later.
Lowering prices in a meaningful way would require deeper reforms: allowing broader negotiation, fixing patent laws that block competition, capping out of pocket costs for more people, and speeding up access to generics and biosimilars. Until then, drug pricing will likely stay near the top of voter concerns, especially for those who keep paying the highest prices in the world.
🔹 In a medical first, doctors used a personalized CRISPR-based therapy to ease symptoms in a baby with a life-threatening genetic liver disorder. The infant, nicknamed KJ, has carbamoyl phosphate synthetase 1 (CPS1) deficiency, which causes toxic ammonia buildup in the blood. A team from Penn Medicine and Children’s Hospital of Philadelphia developed a custom base editor in just six months to target KJ’s specific mutation. After three doses, KJ now needs less medication and can tolerate more protein—early signs the treatment is working. While not a cure, this case marks a breakthrough in rapid, individualized gene-editing therapies for rare diseases.
🔹 HHS is expected to drop routine COVID-19 vaccine recommendations for children, teens, and pregnant women, per the Wall Street Journal. While the CDC still advises vaccination for everyone over six months, HHS may instead encourage doctor-patient discussions. Uptake remains low, just 14% of pregnant women and 13% of children have received the latest shot.
🔹 Biohaven shares fell 22% to $15.38 after the FDA extended the PDUFA date for troriluzole, its treatment for spinocerebellar ataxia (SCA), by 3 months. The delay is to allow time for reviewing recent submissions, with an advisory committee meeting now planned but not yet scheduled. While no new concerns were raised, the added review pushes a decision into Q4 2025 and introduces more regulatory uncertainty. Troriluzole, which has Fast Track, Orphan Drug, and Priority Review designations, could be the first approved treatment for SCA.
🔹 The FDA plans to release new vaccine guidelines in the coming weeks to provide clearer, more predictable standards for manufacturers, especially around COVID-19 shots. Commissioner Marty Makary said the effort, led by CBER Director Vinay Prasad, aims to streamline oversight and clarify regulatory expectations.
🔹 Novo Nordisk has entered a collaboration with U.S. biotech Septerna worth up to $2.2B to develop next-gen oral therapies for obesity, type 2 diabetes, and other cardio-metabolic diseases. The deal includes over $200M in upfront and near-term payments, and focuses on small molecule drugs targeting GPCRs, which are key proteins involved in metabolic signaling. This move strengthens Novo’s obesity pipeline amid rising competition from Eli Lilly’s Zepbound, which has recently outpaced Wegovy in U.S. prescriptions. The companies plan to initiate four development programs, building on Novo’s strategy to diversify beyond injectable GLP-1 therapies. The partnership follows a broader trend of pharma investment in obesity, including Roche’s $5.3B deal with Zealand Pharma in March.
🔹 GSK acquired Boston Therapeutics’ fatty liver disease therapeutic for $1.2B upfront with another $800M potential if it meets regulatory milestones. The once-monthly FGF21 hormone analog, efimosfermin alfa, rapidly reversed and prevented liver fibrosis in clinical trials for metabolic dysfunction-associated steatohepatitis (MASH) with manageable side effects. GSK will continue pursing the therapeutic in MASH, expand the development to alcohol-related liver disease (ALD), and explore combination therapies with their siRNA therapeutic GSK’990. This deal furthers GSK’s place in the race to develop better therapeutics for steatotic liver diseases alongside Madrigal’s Rezdiffra and candidates from 89bio and Akero Therapeutics.
🔹AbbVie entered into a collaboration with ADARx Pharmaceuticals to develop small interfering RNA (siRNA) therapies in neuroscience, immunology, and oncology. AbbVie paid $335M upfront, with additional milestone payments that could bring the total deal value into the billions. ADARx will be responsible for siRNA discovery using it’s proprietary technology while AbbVie will focus on antibody engineering for delivery and antibody-drug conjugates.
🔹 GSK and iTeos Therapeutics have dropped their anti-TIGIT drug, belrestotug, after disappointing phase 2 results in both non-small cell lung cancer (NSCLC) and PD-L1-positive head and neck squamous cell carcinoma. This decision halted all clinical trials involving belrestotug and ended the partnership between the two companies. iTeos cited the current market conditions and shareholder responsibilities as part of the decision. They will share the results of these studies at an upcoming medical meeting.
CLINICAL TRIAL UPDATES
🔹 Vaxart announced full results from its phase 2b challenge study of a first-generation oral norovirus vaccine, published in Science Translational Medicine. The vaccine met 5/6 primary endpoints, demonstrating safety, immunogenicity, and a statistically significant 30% reduction in norovirus infection. While the reduction in symptomatic disease (21%) did not reach significance, the vaccine showed broad immune activation, including increases in mucosal and systemic antibodies. Machine learning analyses identified two correlates of protection (functional blocking antibodies and fecal IgA), which will guide development of Vaxart’s second-generation candidate. Vaxart’s oral pill platform aims to offer needle-free protection against global viral threats like norovirus.
🔹 Apogee reported positive interim results from its phase 1b trial of APG808, showing rapid, robust, and sustained suppression of FeNO, a key biomarker of type 2 inflammation linked to asthma exacerbations. The data support the potential for maintenance dosing every two months or longer, positioning APG808 as a strong challenger to bi-weekly standards like Dupixent. The drug was well-tolerated.
🔹 At the Society for Investigative Dermatology meeting on May 9, Protagonist Therapeutics and J&J presented new phase 3 data for icotrokinra, a once-daily oral IL-23R antagonist, showing 66% and 77% of patients with scalp and genital psoriasis, respectively, achieved clear or nearly clear skin by week 16. The drug maintained a favorable safety profile.
ON THE HORIZON
🔹 May 2025 FDA PDUFAs:
May 22: The FDA is expected to decide on Arcutis Biotherapeutics’ application for Zoryve (roflumilast) foam, a daily topical treatment for scalp and body psoriasis in patients 12+.
May 23: The FDA is set to decide on Sanofi’s sBLA for MenQuadfi, a quadrivalent meningococcal vaccine, which could expand its use to infants as young as 6 weeks for protection against Neisseria meningitidis serogroups A, C, W, and Y.
May 24: The FDA is expected to decide on Liquidia’s resubmitted NDA for Yutrepia, an inhaled treprostinil powder for treating pulmonary arterial hypertension, following tentative approval last year.
May 26: Decision on Merck’s supplemental application for Welireg (belzutifan) to treat advanced pheochromocytoma and paraganglioma (rare neuroendocrine tumors).
May 28: The FDA has extended the PDUFA goal date for Eton Pharmaceuticals’ ET-400, a therapy for a rare pediatric disease, to allow more time to review supplemental data submitted in Dec. 2024.
May 31: Moderna’s next-generation COVID-19 vaccine (mRNA-1283).
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