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Michigan sues opioid distributors; FTC blocks Illumina-Pacific Biosciences deal

Top news

* The state of Michigan has joined the legal fight against opioid distributors, suing Cardinal Health Inc., McKesson Corp., AmerisourceBergen Drug Corp. and Walgreens Boots Alliance Inc. According to a Dec. 17 release from the office of Michigan Attorney General Dana Nessel, the state is the first in the U.S. to pursue charges of drug dealing against the distributors.

"These companies knowingly and deliberately used their licenses to distribute drugs in our state without controls," Nessel said. "This was not only negligent; it was unlawful, a public nuisance and, as a result, their actions subject these companies to liability under Michigan's Drug Dealer Liability Act."

* The U.S. Federal Trade Commission filed a complaint to block Illumina Inc.'s planned $1.2 billion acquisition of Pacific Biosciences of California Inc. The regulator expressed concerns that Illumina aims to "unlawfully maintain its monopoly" in the U.S. for DNA sequencing — used in genetic research and clinical testing — by buying Pacific Biosciences.

* Roche Holding AG said it completed the $4.3 billion acquisition of gene therapy developer Spark Therapeutics Inc. after securing all required regulatory approvals. The Switzerland-based pharmaceutical giant on Dec. 16 concluded a tender offer, which was started in March and had been extended several times in the past months to allow U.S. and U.K regulatory authorities to look further into the deal.

* Tucked inside Congress' $1.4 trillion fiscal 2020 spending bill is a provision that changes the definition of biological products to include chemically synthesized polypeptides, which some groups say will harm lower-cost competition for those therapies. Chemically synthesized polypeptides are used to treat a number of conditions, including cancer, diabetes, heart failure and osteoporosis.

The Biologics Price Competition and Innovation Act of 2010, part of the Affordable Care Act, excluded chemically synthesized polypeptides from its definition of biologic therapies — complex molecules derived from living cells. Under the law, innovator biologic medicines were granted 12 years of marketing exclusivity protection against biosimilar competitors.

* At a sensory science laboratory operated by GlaxoSmithKline PLC, one of the world's biggest drugmakers, researchers monitor 10,000 consumers each year, observing their reactions to new respiratory, pain and oral health products in an attempt to satisfy different tastes from around the world.

U.K.-based GSK says its three shopper science labs — in New Jersey, London and Singapore — have helped the Brentford, England-based company boost consumer sales, which are forecast to reach $10.3 billion by 2020, according to UBS estimates. The business accounted for 26% of GSK's total revenue in 2018.

* The U.S. Department of Justice joined a whistleblower litigation against pharmacy chain CVS Health Corp. and its Omnicare unit for allegedly fraudulently billing Medicare, Medicaid and Tricare by dispensing drugs to older people and those with disabilities without valid prescriptions, violating the federal False Claims Act, Reuters reported.

On the policy front

* The Centers for Medicare and Medicaid Services, a part of the U.S. Department of Health and Human Services, proposed two new rules that aim to increase oversight of the organ donation process and increase financial assistance for donors are expected to increase the number of organ transplants conducted each year. Both rules were directed by a July executive order from President Donald Trump. There are approximately 113,000 Americans on waitlists for organ transplants, and an average of about 20 people on the waitlist die every day because not enough organs are available for transplant, according to CMS.

M&A and capital markets

* FUJIFILM Holdings Corp.'s Fujifilm Corp. subsidiary agreed to acquire Hitachi Ltd.'s diagnostic imaging-related unit to expand its healthcare business for an estimated ¥179 billion. The deal is expected to complete in July 2020, subject to customary closing conditions and regulatory approvals.

* Bausch Health Cos. Inc. is offering $1.25 billion of its senior notes due 2028 and 2030 to raise funds for the $1.21 billion settlement of a class-action lawsuit alleging the company failed to warn investors amid a drastic drop in share price beginning in 2015.

Drug and product pipeline

* Boehringer Ingelheim GmbH and Australia's Pharmaxis Ltd. discontinued the development of the BI 1467335 drug as a potential treatment of the liver disease known as nonalcoholic steatohepatitis. The decision was based on the results of a late-stage study in which patients showed risk of drug interactions, or when one drug among a combination of drugs alters the effect of another.

* Biohaven Pharmaceutical Holding Co. Ltd. said two different dose strengths of its intranasal experimental therapy vazegepant were better than placebo in relieving pain and other symptoms of migraine after two hours of receiving the treatment in a phase 2/3 trial.

* A higher dose of Adamas Pharmaceuticals Inc. experimental multiple sclerosis drug ADS-5102 improved patients' walking speed in a late-stage trial, but the company opted not to immediately commence a planned second late-stage study due to a smaller-than-expected clinical benefit. The phase 3 trial called Inroads evaluated ADS-5102 against placebo in 594 multiple sclerosis patients with walking impairment.

* Pacira BioSciences Inc. said its non-opioid pain drug Exparel met the main goal of a late-stage study in children undergoing spinal or cardiac surgeries. The Parsippany, N.J.-based pharmaceutical company plans to file for expanded approval of Exparel in the U.S. in 2020 following the trial's results.

Operational activity

* Ipsen SA said David Meek resigned as the French pharmaceutical company's CEO and as a board member, effective Dec. 31. Meek will join Switzerland-based private company FerGene as president and CEO.

* Bavarian Nordic A/S agreed to sell a priority review voucher that was obtained through the development of its smallpox and monkeypox vaccine Jynneos for $95 million in cash to an unknown buyer. The transaction is expected to occur in early 2020.

* CytoDyn Inc. signed an agreement granting Vyera Pharmaceuticals LLC an exclusive license to market and distribute its leronlimab drug for treating HIV in the U.S. Under the deal, CytoDyn will receive up to $87.5 million in up-front and milestone payments.

The day ahead

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

In Asia, the Hang Seng gained 0.15% to 27,844.21, while the Nikkei 225 dropped 0.55% to 23,934.43.

In Europe, around midday, the FTSE 100 was up 0.13%% to 7,535.25, and the Euronext 100 increased 0.05% to 1,141.47.

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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