Under Trump, is investment in mRNA cooling?

The Trump administration's decision to cut nearly $500 million in federal support for the development of mRNA vaccines is being felt across the biotech industry — but not always in the same way.

Venture funding for mRNA vaccines — already a tough sell due to uncertain returns — has no doubt chilled, and forced some infectious disease vaccine makers to pivot to other targets or risk shutting down, STAT’s Jonathan Wosen and Allison DeAngelis write.

But work on mRNA therapeutics is still drawing big rounds from investors who, for now, seem mostly unfazed by a change in the political climate.

“Investment discussions, which used to be focused on science and business development, now have a large component of political discussion,” said Jonathan Kagan, scientific cofounder of Corner Therapeutics. “That means that you hear people saying things like, ‘We have the money. We’re interested in your technology. Do you think that the federal government is going to interfere with our business development plan?’”

drug pricing

Drugmakers unite to shape Medicare price negotiations

Merck, AstraZeneca, Bristol Myers Squibb, and Eli Lilly have formed the IRA Watchdog, a coalition housed within the law firm DLA Piper, to warn lawmakers about what they see as the harmful effects of Medicare's new drug price negotiation powers under the Inflation Reduction Act.

The ad-hoc group is staffed by onetime aides to former Republican Sen. Richard Burr, STAT's John Wilkerson reports. It describes itself as a “coalition analyzing the impact of Medicare Drug Price Negotiation on patients.”

BIOTECH

In a financial fix, Sarepta sells Arrowhead stock

From my colleague Jason Mast: Here’s the problem for Sarepta Therapeutics: The company's future is now reliant on a series of early-stage RNA-based drugs it licensed last November from Arrowhead Pharmaceuticals. Sarepta just can’t seemingly afford to actually pay Arrowhead the many hundreds of millions of dollars that will be required to keep that collaboration alive.

Sarepta signed the deal when it still expected to earn billions from Elevidys, its Duchenne gene therapy. Now — even though the drug is available to younger patients again, despite two deaths in older patients — it faces a limited market, which may shrink further as competitors reach approval. Competition is also coming for Sarepta's exon-skipping drugs.

To keep the deal alive, the company has to keep providing annual payments and milestones, including a $100 million payment triggered last month and another $200 million payment likely to be triggered later this year. And it needs to do that while maintaining the resources required to pay back a $1.1 billion loan due in 2027.

The company announced part of its solution yesterday. It’s selling off $174 million in Arrowhead stock it purchased in November, while also transferring $50 million in stock back to Arrowhead to pay half of that first milestone payment.

Sarepta took a significant loss on the transaction, having originally purchased the shares at an almost $10 premium. It might not be the last such move the company has to make as it tries to keep the deal.

For his part, Arrowhead CEO Chris Anzalone seems blasé about whether Sarepta comes through or not. “The deal goes as planned. Great,” he told Biospace recently. “The deal goes under, we get our assets back and we keep the cash. That’s also fine.”

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