Pipeline Concerns: Four Biotechs to Keep Your Eye On

When a pipe in someone’s house breaks or leaks it can cause a lot of damage to the property if it is not addressed in a timely manner. The same can be said for the pipelines of biopharma companies. If a pipeline is not well-secured, the leaks can weaken the intrinsic value of the business.

There are any number of things that can weaken a pipeline, including expiring patents, generic challenges or not having enough assets in various stages of development. On Monday Investor Place pointed to four biotech companies that have "leaky" pipelines that could lead to financial losses.

Madrigal Pharmaceuticals – The hopes of Madrigal lie on one drug in its pipeline, MGL-3196. In February Madrigal announced that MGL-3196 cleared a Phase II trial for the treatment of patients with heterozygous familial hypercholesterolemia (HeFH), a severe genetic dyslipidemia that causes early onset cardiovascular disease.

MGL-3196, a thyroid hormone receptor β-selective agonist medication, is also being developed as a treatment for patients with non-alcoholic steatohepatitis (NASH). It is currently in Phase II development for Madrigal. There are currently no approved treatments for NASH. The NASH market is white hot with multiple big pharma players working on a therapy for the disease.

Madrigal’s pipeline stands on the success or failure of MGL-3196. The only other asset the company shows on its pipeline webpage is MGL-3745, a THR β-selective agonist follow-on therapy that is currently in pre-clinical development.

AbbVie – Illinois-based AbbVie earns about two-thirds of its annual income from one drug – Humira, the best=selling drug in the world. Granted the drug delivers billions of dollars annually to the coffers of the company ($18 billion last year) but it is facing challenges from biosimilar manufacturers as well as sun-setting patents. The company should begin to see declining revenue in a few years as challengers begin to market products. Last week AbbVie was successful in fending off biosimilar challenges from Samsung Bioepis until 2023 in the United States. However, Samsun Bioepis will begin marketing its biosimilar in Europe later this year.

Rigel Pharmaceuticals – Bay Area-based Rigel Pharmaceuticals is anticipating the U.S. Food and Drug Administration to rule on its rare blood disorder drug Tavalisse (fostamatinib) later this month. The company is expecting the FDA to approve the drug for the treatment of adult patients with chronic or persistent immune thrombocytopenia. However, earlier this month Rigel’s fostamatinib failed a mid-stage trial for another indication, IgA nephropathy (IgAN), an orphan kidney disease. The drug failed to meet statistical significance in the treatment.

Investor Place said Rigel’s pipeline is exploring the efficacy of Tavalisse for multiple indications, which could be of concern to investors. The article noted that the company does have some developmental projects with other companies, but said if those hit, they generate less profit for the company.

Alexion Pharmaceuticals – Alexion Pharmaceuticals has gone through a significant leadership change over the past several months. The company markets Soliris, the most expensive drug in the world. Soliris, which is used to treat a number of rare blood disorders, accounts for 89 percent of Alexion’s earnings, Investor Place said. Like AbbVie’s Humira, Soliris is beginning to see challenges from biosimilars. This morning though Alexion has made a move to expand its pipeline with an acquisition of Wilson Therapeutics. The deal will bring the Phase III drug Wilson’s disease treatment WTX101 into the company’s pipeline. WTX101 has received Fast Track designation in the United States and Orphan Drug Designation for the treatment of Wilson disease in the U.S. and the European Union.

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