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KKR in $9.9B deal for Envision; Sanofi, Lilly no clue on Trump insulin deal

Top news

* KKR & Co. LP is acquiring U.S. medical services provider Envision Healthcare Corp. in an all-cash transaction valued at about $9.9 billion, including the assumption or repayment of debt. Under the definitive agreement, the private equity firm will acquire all of Envision's outstanding common shares for $46 each.

* A spokeswoman for Sanofi told S&P Global Market Intelligence the French drugmaker has not agreed to a deal with, nor received a proposal from the Trump administration, to lower the list price of insulin for Medicare beneficiaries. According to a June 6 report in InsideHealthPolicy, the Centers for Medicare and Medicaid Services plans to soon reveal an agreement under which insulin manufactures, such as Sanofi, would lower the cash price of their products for Medicare beneficiaries who choose to buy the medicines outside of their drug plans.

If the "rumors of a CMS program for insulin pricing" are true and the Trump administration is considering a proposal like the one described in the InsideHealthPolicy report, "it would be a welcome step forward in helping reduce patients' out-of-pocket costs," a spokeswoman for Eli Lilly and Co. told S&P Global Market Intelligence. A third insulin maker, Novo Nordisk A/S, did not respond to questions about the reported CMS deal.

* With the Right To Try Act now signed into law, drug manufacturers could find themselves under greater pressure, including targeted "naming and shaming" social media campaigns, to provide their unproven, experimental therapies to patients desperate for a cure. At last week's annual BIO International Conference in Boston, one biotech CEO, who did not want his company identified, said he had received a "threatening" phone call from a family member of a late-stage cancer patient seeking access to the company's experimental medicine under the new law.

* The 2017-2018 U.S. influenza season turned out to be one of the deadliest in recent years for children, killing 172 pediatric patients, health officials reported on June 8. That number exceeded the 171 pediatric-related flu deaths reported during the 2012-2013 season, which previously held the record — excluding pandemics, like in 2009-2010 when 358 children died of the H1N1 virus — the Centers for Disease Control and Prevention said.

* Four out of five experimental Ebola treatments are on the ground in the Democratic Republic of the Congo and being administered under compassionate use, World Health Organization officials said. One new case of the viral hemorrhagic disease was recently reported, adding to a tally of 62 confirmed or likely cases, including 27 deaths, across two rural regions and one city, Mbandaka, in the DRC.

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* Vertex Pharmaceuticals Inc. should significantly slash prices for three cystic fibrosis drugs or risk harm to patients and future innovation, the U.S. cost advisory group the Institute for Clinical and Economic Review said in a final report. Vertex's Symdeko, Orkambi and Kalydeco would need to be discounted up to 77% to be cost-effective for their clinical value, ICER concluded.

M&A and capital markets

* VetCor Group Holdings Inc. is looking to be sold for as much as $1.5 billion, the Wall Street Journal reported, citing people with knowledge of the matter. If the deal goes through, it could be one of the biggest private equity exits from a veterinary services provider in the past five years.

* Private equity firms ACON Investments LLC and Humus Capital Partners LLC acquired a majority stake in Biosidus SA and Biosidus Farma SA. Buenos Aires, Argentina-based Biosidus develops biosimilars — or identical copies of medicines sold by a different company — with focus on treating chronic kidney failure, cancer and multiple sclerosis, among others.

* TapImmune Inc. signed a private placement agreement with institutional investors to raise about $70 million. Proceeds will be used to advance the company's T cell therapy to phase 2 clinical studies, continue other clinical trials and build operational and clinical facilities.

Drug and product pipeline

* Vical Inc. said the phase 2 study of its herpes vaccine — specifically for herpes simplex virus type 2, or HSV-2, the leading cause of recurrent genital herpes — failed to meet its main goal. The company is terminating the HSV-2 program.

* Amgen Inc. said the European Commission approved its Prolia treatment for patients with a certain type of bone-loss disease. The Thousand Oaks, Calif.-based biotechnology giant said the European regulator approved Prolia, or denosumab, for treating glucocorticoid-induced osteoporosis in adult patients at increased risk of fracture.

* A combination of AbbVie Inc.'s Venclexta and Roche Holding AG's Rituxan gained the U.S. Food and Drug Administration's approval to treat patients with a certain type of blood cancer regardless of a particular genetic mutation. The regulator approved the combination therapy to treat patients with chronic lymphocytic leukemia or small lymphocytic lymphoma who have received at least one prior therapy.

* H. Lundbeck A/S and Takeda Pharmaceutical Co. Ltd. said Trintellix was more effective in treating depression than placebo in a phase 3 trial. Denmark-based Lundbeck and Japan-based Takeda now plan to seek Japanese approval for the medicine.

Operational activity

* NMC Health PLC agreed to form a joint venture healthcare company in Saudi Arabia with the General Organization for Social Insurance, or Gosi — the largest pension fund in the kingdom. As part of the deal, Gosi will transfer its 38.9% stake in Tadawul-listed National Medical Care Co., or CARE, at 70 Saudi riyal per share, to help set up the joint venture healthcare company.

The day ahead

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

In Asia, the Hang Seng was up 0.34% to 31,063.70. The Nikkei 225 rose 0.48% to 22,804.04.

In Europe as of midday, the FTSE 100 was up 0.91% to 7,750.65, and the Euronext 100 rose 0.43% to 1,062.12.

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