J.P. Morgan Day 4: Moderna, Berkeley Lights, Sanofi, Pfizer and More
As the J.P. Morgan Healthcare Conference winds down for 2020, one of the big topics was the general lack of big deals. Still, there were some general trends and for today, some news.
For broader trends, there was some discussion of what exactly digital health is. The Digital Therapeutics Alliance defines digital health as describing “all technologies that engage patients for health-related purposes; as such, it encompasses a wide range of products used across the wellness and healthcare industries.” This often seems to overlap with digital therapeutics, and to some extent, the use of artificial intelligence and machine learning in drug development, clinical trial design and regulatory submissions.
There was talk of the continuing impact of tech companies like Google, Microsoft and Facebook on the industry, as well, of course, as drug pricing. The hot topic there was the launch of EQRx with $200 million in Series A financing. The company plans to provide a market-based solution for the drugs it develops.
There was also some discussion of biopharma’s diversity problem—which is to say, a domination of white males in, according to Arrakis Therapeutics’ chief executive officer Michael Gilman, “Patagonia vests.”
Otherwise, top stories included:
Moderna Working with Amazon’s Cloud Service
At JPM, Moderna’s chief executive officer Stephane Bancel told CNBC’s Jim Cramer how the company is utilizing Amazon Web Services. “We have a Phase II study going on where we are designing every product for every patient,” Bancel said. “So we start by taking a biopsy of a cancer, we next-gen sequence it, we next-gen sequence a healthy cell of a body [and] we send everything to AWS” to “compare every letter of a DNA … of a healthy cell and a cancer cell, and from that, we deduce what do we need to do in our product just for your cancer.”
Berkeley Lights Expands Throughout the Industry
Eric Hobbs, chief executive officer of Berkeley Lights, presented at the meeting, discussing upcoming products. The company was launched in 2016, and its Beacon Optopfluidic Platform has been installed at 50% of the top 25 pharma companies and is presently working with top cancer centers and synthetic biology companies. In his talk, Hobbs said, “At Berkeley Lights, we’ve created advanced environments for functionally testing live cells to accelerate the discovery and development of cell-based products. We do it in a fast, repeatable and automated way, at all points in the discovery process, giving our customers the highest probability of selecting the best cells to create a cell-based product and the shortest time to biologic product and revenue.”
Too Much Reaction to Politics
At the same time that everyone is notably concerned about the U.S. presidential election and the hot-button topic of drug pricing, many in the industry feel that investors are overreacting to politics. Michael Neidorff, chief executive officer of Centene Corp., said he is “beyond surprised” at how much managed-care company stocks have been moving around in response to news about the presidential election. “There is no rational reason to let a Des Moines Register poll” affect investment decisions in the sector, he said. Neidorff, on his part, doesn’t believe the U.S. can afford a single-payer government healthcare system and doesn’t expect one to come into being.
Sanofi Boss Predicts a Bolder Company
Sanofi’s relatively new chief executive officer, Paul Hudson, who took over the job in June 2019, assured investors that Sanofi’s reputation for timidity was undeserved and no longer true. He also guaranteed that his strategy would involve acquisitions. “We will enrich our pipeline externally,” he said in an interview at the meeting.
He also said, “An accusation labeled or leveled at us the last few years is that we’ve been a little too into the late-stage, a little too risk-averse and perhaps we changed the profile of the company to be a little bit conservative. I can tell you from the people I’m working alongside now it’s not the case.”
Congress May Act on Drug Prices
Yes, it’s an election year. And yes, campaign promises are often just so much rhetoric, particularly on tough issues like drug pricing. Still, Steve Ubl, president of the Pharmaceutical Research and Manufacturers of America (PhRMA), believes Congress might agree on legislation in the first half of this year that could decrease drug costs. He says there is overlap in some drug-price bills in the House and a bipartisan bill the Senate Finance Committee passed last year.
“To be honest, we don’t love every aspect of every one of these bills, but if Congress wants to act on drug pricing, the contours of an agreement are there,” he said in a panel discussion. “The real question is whether politics will supersede the discussion.”
Pfizer’s Bourla Works on Rebranding the Company
In a presentation by Albert Bourla, the chief executive officer of Pfizer, who took over the company from Ian Read last year, plans to streamline the company, pare down non-R&D expenses and focus on six, instead of 12 areas.
“Phase II success rates—the industry is at 30%,” he said. “Pfizer for many years was at 15%. We were taking an approach of very little rigor.”
He planned on licensing smaller add-ons to the pipeline in the six areas and doesn’t have plans—or none he will admit to—for a larger merger or acquisition. He did add, “We never say never.”
Coming Back Next Year
As beautiful and interesting a city as San Francisco is, it brings in plenty of complaints during the conference, many about the high price of coffee, hotel rooms, meeting space and other items in the area. This year some are complaining about the “squalor” and the number of homeless people living in the Bay Area. Nonetheless, JPM 2021 will be held in San Francisco. And the San Francisco Travel Association, already heard that JPMorgan plans to keep the conference in the city through 2025, although that’s from several hotels in the city, not the meeting organizers themselves. So far, JPMorgan has declined to comment on plans past 2021.