With the recent bank failures affecting many life sciences companies, it can be easy to lose sight of all the other industry news this week. So we will focus on the other stories you may have missed. In this issue we look at an increase in Nasdaq delisting notices among biotech companies, a major acquisition by Pfizer, government regulation of drug pricing, as well as a significant decrease in insulin prices. Finally, we highlight a method for evaluating heart disease risk.
Each week we feature five things affecting the life sciences industry. Here’s the latest.
The Nasdaq requires that registrants’ stock prices remain above $1 per share. If a company’s stock price falls below this threshold, they are issued a delisting notice and have 180 days to regain compliance. During the fourth quarter of last year, 64 biotech companies received such notices. This is a significant increase from previous quarters, when fewer than 30 biotechs received such a notice. This issue is driven by decreased valuations. A report from Evaluate Vantage indicated that last year only one-fifth of 532 small-cap biotech companies had increases in stock price.
This week, Pfizer announced the acquisition of Seagen, a biotech company focused on monoclonal antibody-based oncology treatment. Seagen has four approved cancer drugs that had combined sales of approximately $2 billion last year. The deal is still subject to review by the Federal Trade Commission.
The Biden administration announced this week that they will impose inflation penalties on 27 drugs for which price increases in the fourth quarter last year exceeded the inflation rate. The penalties apply to drugs sold to Medicare patients. The penalties will be assessed in the form of a rebate on future purchases. Moving forward, Medicare will perform a similar review of drug pricing each quarter.
Novo Nordisk announced this week that it would decrease pricing for insulin in the United States by up to 75% starting next year. This comes two weeks after its competitor Eli Lilly announced similar reductions in prices. Many government officials, including President Biden, have pushed for caps on insulin as a significant number of diabetes patients struggle to afford it.
For years, physicians have used cholesterol tests as a mechanism for determining patients’ risk of heart disease. Recent studies have shown that testing for ceramides, a type of lipid, may be more accurate. While additional research is required to determine the accuracy of such tests, both health care providers and pharmaceutical companies are devoting significant resources to testing programs for ceramides and drugs to reduce ceramide levels.