Episode 15

Following busy weekends of tennis and pop concerts, Luisa and Kerry reconvene to debate key takes from meetings last week with Merck & Co’s Head of R&D, Dean Li, and Teva’s CEO, Richard Francis. Topics covered include oncology, cholesterol, HIV and China. 

Transcript

SPEAKER_00 0:00

Hi, I'm Louisa Hector.

SPEAKER_01 0:01

And I'm Carrie Holford.

SPEAKER_00 0:03

Welcome to Over the Pill, the weekly podcast on the latest hot topics in pharma investing. Morning. Good morning. I'm a little bit sore today. Why is this? Well, I had my amazing weekend of tennis, remember, with coaching from Pat Cash. Oh yes. And I'm still rubbish. He also plays in a band, so the band was performing for the 125th anniversary of the club.

SPEAKER_01 0:33

So are you sore because of the tennis or because of the disco dance?

SPEAKER_00 0:37

All of it. The dancing and the tennis, and there was another few hours of tennis. And then I woke up the next morning and I played tennis badly. Anyway, you meanwhile were hanging out with the stars.

SPEAKER_01 0:48

Oh my goodness, we went to Wembley Stadium to see Harry Styles. It was fabulous. Just the girls? Yeah. The girls, the mums, the daughters. And in fact, I'm gonna estimate that 95% of the audience were female. I did feel sorry for the 5% who were clearly dragged along by their partners. But it was great fun. I mean, he's a real showman. There was just a super happy, positive space to be in.

SPEAKER_00 1:13

So lots of- But not one for me to take the boys to.

SPEAKER_01 1:16

No, I would not. We haven't asked.

SPEAKER_00 1:18

Okay, so we thought we might not have so much to say today, and actually we've realized we're kind of overloaded now with thoughts. We were on the road with Teva. We were on the road with Merck, US Merck. So where shall we start?

SPEAKER_01 1:34

Well, you were on your own for Tevor.

SPEAKER_00 1:37

Yes.

SPEAKER_01 1:38

So I can't sort of quiz you so much on that, but we can definitely dig into the details on Merck. So why don't we start with Tevor?

SPEAKER_00 1:45

Yeah, so maybe just a quick comment there. So we were lucky enough to be with Richard Francis and then Chris and Yale from Investor Relations. I mean, uh there's a lot going on at Teva, as we know, that shift into innovative pharma. But the recent deal, the MLX deal where they've got the Tourette's drug, that's now filed. So that was a recent press release anyway. They have orphan drug in the pediatric setting. So he confirmed it was a competitive deal, but Teva had been talking to the company for around two years. So they were successful there. And we should expect more business development. Really, the targets being sort of synergistic assets and the key areas that they're in already, but also considering rare disease, because there they can be more disease agnostic. And that reminds me, just before we get to Merck, so we also had the defininium data last week, the psychedelic data in the depression, really looked incredible. So that was phase three, the first of a few phase three readouts. Looked excellent, made me realise I'm very keen to see now what Abvi does with its asset that's about to sort of head into phase two B slash three trials. So we'll be looking out for the design and the breadth of indications there.

SPEAKER_01 3:01

Excellent. So yeah, then on to Merck. I mean, we hosted a head of RD, Dean Lee. I thought he was excellent. We had a couple of meetings with him. So where to start?

SPEAKER_00 3:15

Well, we covered such a broad range of topics, didn't we? And Dean was incredibly thoughtful. I mean, we kind of kicked in with China, IP acquisition opportunities in China. We went into clinical trial, how to run them, how to speed up, given China's kind of got this time advantage at the moment, and his views on how the FDA is working to try and expedite, even just, you know, first in human phase one, all the way through to phase three trials. I was struck also by his level of thoughtfulness, I think coming from a medical background within the US, on the burden for patients and hospitals and how the drug treatments can really ease that burden. That came up across a number of therapy areas, I felt. I noted one comment on K-Truder because K-Truder's IV coming to the end of its life cycle, and they've recently launched QLEX, the subcutaneous form. This is a much faster administration, two minutes. And he talked about that being so much easier on the healthcare system and patients. And that means actually, just thinking it through, when K-Truder is available as a biosimilar, then eventually the incentives for doctors to be using IV-only regimes diminishes because of the different selling price. And so that's interesting because there's scope then to be combining K-Truder Culex with small molecules. So as we think about the pipeline and some of those really exciting small molecules coming through, that's interesting. We also talked a little bit about genetic profiling, kind of recruiting patients based on their profile. But Dean highlighted, for example, keynote 189, the seminal trials. So it has been really important for them to check using genetics who were the responders in keynote 189. This was Ktruder plus chemo. And if that response was driven, for example, by KRAS mutation, that would influence your decision to be now looking at Ktruder, probably K-Truder Culex, with a small molecule in a KRAS inhibitor. So you're displacing the chemo there. So again, this kind of this new future, different combinations, and how to displace and how the genetic profiling, even of some historic trials, is still very important. So, as expected, a lot of conversation on oncology, but we did go elsewhere.

SPEAKER_01 6:01

We spoke to some extent about the PCSK9. I thought it was really interesting here, the example he gave with regard to speed of moving through development with that product and being touching here on AI, but it was a pretty rapid move through the clinical trial phases for that product, and obviously becoming close to data soon. But that one he's clearly very enthusiastic about, also with regard to the potential peak and the breadth of the population.

SPEAKER_00 6:34

I was really struck by that as well. So they entered humans in 2019. And here the challenge, remember, this is an oral peptide. So the challenge was also manufacturing. And as they brought the drug into humans, they also had to improve the manufacturing so they could launch and be ready to manufacture at scale. So he talked about having the molecule, they could make it, but not for less than a dollar. So in parallel with the development, the manufacturing was running at pace to reduce the number of manufacturing steps to below 15. I think that was the target. And clearly, you know, that has all come through. And this is one where they're using one of the commissioner's priority review vouchers. So we got the update there. So there is no Purdue for date. In fact, that will probably be announced pretty late in the review period. So maybe, you know, once they announce it's sort of two months ahead of the actual date. But I got a lot of comfort there that already within that sort of essentially a rolling filing, CMC, kind of all that manufacturing is already being dealt with, and they will absolutely be ready to go once that decision hopefully has come through positively. So that should be a really nice launch for them as we go through the end of the year. HIV? I mean again, we touched on it briefly right at the end. He was excited for that.

SPEAKER_01 7:56

Yeah. And he talked about sort of within their expectations, you know, they've got four opportunities here, spreading the risk across those. I guess what I took away from that is their his his level of excitement about participating in the PrEP, the prevention market. I think it's very easy for us to look at Gilead ramping nicely with Yes2Go, GSK, Apridude on the market, and that's still growing better than we had expected. But Merck are working on their once monthly oral. And just an interesting way he sort of pitches that to think about rapid protection very soon after taking the product, very easy to take, providing protection for the months when you choose to take it. And I think maybe that we've thought mostly about PrEP being a two competitor market. So that for me was a reminder that Merck are operating here with their own product, not just with Gilead. So that I found really interesting, yeah.

SPEAKER_00 9:03

Great. Well, I need to go and get ready for a Q2 call with Astra.

SPEAKER_01 9:08

More prep to do before we hit the results seasons. So let's get back to the desk. As ever, we would love to hear your feedback and requests. Please do email us at kerry.holford or louisa.hector at berrenberg.com. Thank you for listening.