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Novartis to buy Endocyte for $2.1B; Pfizer to roll out early retirement plan

Top news

* Switzerland-based Novartis AG will acquire Endocyte Inc. for $24 per share, or a total equity value of about $2.1 billion, in cash. West Lafayette, Ind.-based Endocyte is developing Lu-PSMA-617, a potential radioligand therapy for prostate cancer that is in phase 3 development.

* Novartis also reported third-quarter core earnings of $1.32 a share, up 2% year over year. The Swiss drugmaker revised its net sales guidance upward, as it now expects group net sales to grow in the mid-single digits up from the previous guidance of low- to mid-single-digit growth in 2018.

* Pfizer Inc. has confirmed reports that employees have been offered early retirement options as the pharmaceutical giant seeks growth. The company did not reveal exactly how many employees would be retiring or let go. "As we prepare for growth, we're creating a simpler, more efficient structure, which will affect some managerial roles and responsibilities," a spokesperson from Pfizer told S&P Global Market Intelligence in an Oct. 17 email.

* Express Scripts Holding Co. has included a new class of migraine drugs from Eli Lilly and Co. and Amgen Inc. in its 2019 national preferred formulary. However, the pharmacy benefit manager excluded Teva Pharmaceutical Industries Ltd.'s migraine therapy Ajovy — which works similarly to Eli Lilly's Emgality and Amgen's Aimovig — from its list.

* Aurora Cannabis Inc. has been accepted to list on the New York Stock Exchange. The approval marks the latest a Canadian cannabis producer will enter the U.S. stock market.

* Merck KgaA CFO Marcus Kuhnert said in an interview with CFO Journal that the German drugmaker is looking at more collaborations to help its research and development efforts, Endpoints News noted. Kuhnert said the company will centralize R&D spending for its performance materials business at it faces increased pricing pressure from Chinese players, The Wall Street Journal wrote.

On the policy front

* The Trump administration unveiled its fall unified agenda of regulatory and deregulatory actions that it plans to take over the next several months, including a plethora of proposals from the U.S. Food and Drug Administration and the Centers for Medicare and Medicaid Services. The White House Office of Management and Budget also reported that the administration eliminated $23 billion in overall regulatory costs across the government in fiscal year 2018 through its reform efforts.

* The Ebola outbreak in the Democratic Republic of the Congo does not yet constitute an international public health emergency, the World Health Organization's emergency committee said following an Oct. 17 convention. However, authorities remain "deeply concerned" by the outbreak — which has taken the lives of 139 people — and will continue to monitor the situation closely.

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M&A and capital markets

* Germany's Merck KgaA is selling MilliporeSigma's flow cytometry portfolio to biotech company Luminex Corp. for €62.5 million. The business includes the Amnis brand, comprising of imaging flow cytometry products for cell-based analysis, and the Guava brand, comprising of systems based on microcapillary technologies.

* Takeda Pharmaceutical Co. Ltd. said the Japan Fair Trade Commission granted unconditional clearance to its £46 billion takeover of Dublin-based biotechnology company Shire PLC. The European Commission will decide whether to approve the acquisition Nov. 6.

* Tiziana Life Sciences PLC expects to issue 1,010,111 American depositary shares at an anticipated price of $9.90 per ADS in its U.S. IPO. The London-based biotech company, which plans to raise about $10 million through the offering, applied to list the ADSs on the Nasdaq Capital Market under the symbol TLSA.

* Gamida Cell Ltd. set a price range of $13 to $15 per share for its IPO on Nasdaq. Assuming a share price of $14 apiece, the Israeli stem cell therapy developer expects to raise $44.2 million from the flotation.

Drug and product pipeline

* Merck & Co. Inc. said the phase 3 study of its blockbuster anti-PD-1 therapy Keytruda, in combination with Pfizer's Inlyta, met both main goals in treating the most common type of kidney cancer. The regimen was being evaluated in the first-line treatment of advanced or metastatic renal cell carcinoma and was found effective in prolonging patients' lives from the start of treatment and extending their lives while keeping the disease at bay.

* Diurnal Ltd. paused the U.S. development of its hormone deficiency drug Chronocort after the medicine failed to meet its main goal in a phase 3 European trial. Diurnal was evaluating whether Chronocort was better than conventional therapy in adults with congenital adrenal hyperplasia, a group of inherited genetic disorders that affect the adrenal glands.

* Allergan PLC will seek U.S. approval for its migraine drug ubrogepant in the first quarter of 2019 after two new phase 3 studies showed the drug was safe and tolerable.

* Achaogen Inc. is seeking European approval of Zemdri, a drug to treat resistant bacteria, after announcing a corporate restructuring to develop the medicine in July. The biotech company has submitted an application to the European Medicines Agency for Zemdri, or plazomicin, to treat complicated urinary tract infections, bloodstream infections, and infections due to Enterobacteriaceae in adult patients with limited treatment options.

* Eiger BioPharmaceuticals Inc.'s experimental drug, pegylated interferon lambda, reduced viral load in a mid-stage study on patients infected with the Hepatitis Delta virus.

Operational activity

* Jim Scholefield will join Merck & Co. Inc. as chief information and digital officer, effective Oct. 29. Scholefield is Nike Inc.'s chief information officer where he led the upgrade of the company's cybersecurity and other critical infrastructure.

* Celgene Corp. will not exercise its option to license cancer drug candidate rosmantuzumab from OncoMed Pharmaceuticals Inc. after the therapy failed to provide compelling evidence of clinical benefit in an early stage study in patients with solid tumors. Celgene recently decided against licensing ovarian cancer drug navicixizumab from OncoMed, similarly due to a lack of clinically proven benefit.

* The U.S. FDA placed a full hold on Affimed N.V.'s early stage clinical trial evaluating AFM11, a CD19/CD3-targeting T cell engager, in treating CD19 positive B cell non-Hodgkin lymphoma. The German biopharma company recently halted the study after the death of one of the patients and other life-threatening events.

Our features

Of Mice Not Men: Immune cells as potential targets for cancer therapy: In two separate studies, researchers looked at the relationships between immunosuppressor cells and triple-negative breast cancer and neutrophils and lung cancer, and the possibility of targeting these immune cells as part of cancer treatment.

Cardiac devices, diabetes care help drive Abbott's Q3 growth: Abbott Laboratories saw sales growth of 7.8% in Q3, fueled by a 20% sales growth in the company's electrophysiology devices and a 40% growth in diabetes devices.

Other features

* A new study shows that Gilead Sciences Inc.'s pre-exposure prophylaxis pill Truvada has reduced new cases of HIV among gay and bisexual men across Australia by almost a third, Bloomberg News reported.

The day ahead

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

In Asia, the Nikkei 225 was down 0.80% 22,658.16, while the Hang Seng fell 0.03% to 25,454.55.

In Europe, as of midday, the FTSE 100 fell 0.10% to 7,047.51, and Euronext 100 rose 0.33% to 1,004.38.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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