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Actelion may float R&D unit in June; J&J talc-related cancer trials to proceed

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Actelion may float R&D unit in June; J&J talc-related cancer trials to proceed

* The takeover of Actelion Ltd. by Johnson & Johnson will result in a spinoff company, with 600 employees and about 14 products under development. This division could go public on the Swiss stock exchange as early as June, with Johnson & Johnson expected to hold 32% of shares, Swiss weekly Handelszeitung wrote. At an investor call, Johnson & Johnson said it agreed not to sell on the open market any equity stake in the spinoff company for two years, although it is uncertain on how long it would hold a stake in the unit, Reuters noted.

Meanwhile, the Missouri Supreme Court in the U.S. denied the requests of Johnson & Johnson and Imerys Talc America, its baby powder talc supplier, to delay upcoming trials over allegations that the company's talc-based products led to the development of ovarian cancer in some women. The court's ruling allows the next trial to proceed on Feb. 6 in St. Louis.

* Moody's changed the outlook on Novartis AG's Aa3 long-term rating to negative following the company's announcement of a $5 billion share buyback. The rating agency said the debt-funded buyback exceeds Novartis' free cash flow, further straining the company's "already weak" credit metrics over the next 12 months, especially when sales are expected to be flat year over year.

* Celgene Corp. reported a year-over-year increase in fourth-quarter 2016 adjusted net income to $1.29 billion, or $1.61 per share, from $961 million, or $1.18 per share, in the same quarter of 2015.

* Rep. Greg Walden, R-Ore., chairman of the House Energy and Commerce Committee, said on CNN yesterday that he will introduce a bill next week that will ensure continued coverage of Americans with pre- existing conditions if the Affordable Care Act is repealed, The Hill wrote.

President Donald Trump yesterday admitted that he has considered keeping the ACA for two years due to the political "risk" that repealing the law would transfer the heat from the Democrats to the Republicans, according to The Hill. However, Trump said the ACA would "explode" if retained, and that the law must be quickly repealed and replaced.

* The Centers for Medicare and Medicaid Services have publicly provided data on Medicare Part D prescription rates across the country in a bid to curb opioid abuse. CMS said it would use the data to sanction overprescribers and provide help to those who use too much.

* Former Turing Pharmaceuticals AG CEO Martin Shkreli and his former lawyer and co-defendant Evan Greebel want to be tried separately on charges of fraud and conspiracy in Brooklyn federal court, CNBC reported. If Judge Kiyo Matsumoto approves their severance motions, Shkreli's trial would begin June 26, while Greebel's trial would be moved to October.

M&A and capital markets

* Jounce Therapeutics Inc. plans to raise approximately $101.8 million in its IPO of 6,365,000 shares. The clinical-stage immunotherapy company priced its offering at $16 apiece and offered underwriters a 30-day option to purchase up to an additional 954,750 of the shares offered.

* Sumitomo Dainippon Pharma Co. Ltd. completed its $200 million acquisition of U.S.-based Tolero Pharmaceuticals Inc., Iyaku Keizai reported.

Drug and product pipeline

* Pfizer Inc. is progressing its Clostridium difficile vaccine candidate PF-06425090 into a phase 3 trial. C. difficile is a spore-forming virus that typically causes life-threatening diarrhea and intestinal perforations.

* The U.S. FDA granted AstraZeneca PLC's Symbicort inhalation aerosol six months of pediatric exclusivity. The inhaler is approved in the U.S. to treat asthma in patients 12 years and older and for the maintenance treatment of chronic obstructive pulmonary disease in adults.

* The FDA approved a 72 microgram dose of Ironwood Pharmaceuticals Inc. and Allergan PLC's Linzess for the treatment of chronic idiopathic constipation in adults. The new dose is expected to be available in the first quarter.

* Kubota Pharmaceutical Holdings Co., Ltd. unit Acucela Inc. launched the phase 2a study of emixustat hydrochloride in individuals with macular atrophy secondary to Stargardt disease, a rare, genetically inherited disease that directly affects the retina of the eye, often resulting in the slow progression of vision loss in children.

Operational activity

* South Korea-based Mezzion Pharma Co. Ltd. filed a lawsuit for damages against Dr. Reddy's Laboratories Ltd. in New Jersey State court in the U.S. The case alleges that Dr. Reddy's committed fraud when it hid deficiencies in its manufacturing practices and misrepresented its compliance to Mezzion. Dr. Reddy's said it has not received any legal papers in relation to the matter.

* Eli Lilly & Co. terminated the collaboration and license agreement for the development of Adocia SA's ultra-rapid insulin, known as BioChaperone Lispro, for treatment of people with type 1 and type 2 diabetes. The rights that Adocia has licensed to Lilly will revert to Adocia at no cost.

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Debate heats up over Sanofi's rights to Zika vaccine development: The U.S. Army plans to grant Sanofi Pasteur an exclusive license to develop a Zika vaccine, drawing criticism from organizations concerned about pricing and competitiveness.

Supreme Court arguments expected in April in Amgen-Sandoz biosimilars case: The high court is being asked to decide how soon a biosimilar should be permitted to enter the U.S. market after it is approved.

The day ahead

Early morning futures indicators pointed to a mixed opening for the U.S. market.

In Asia, the Hang Seng slipped 0.06% to 23,360.78, while the Nikkei 225 increased 0.34% to 19,467.40.

In Europe, around midday, the FTSE 100 was down 0.06% to 7,157.12, and the Euronext 100 was down 0.33% to 934.39.

The Daily Dose is updated as of 6:30 a.m. ET. Some external links may require a subscription.