* Merck KGaA said second-quarter preexceptional EPS amounted to €1.54, a gain of 25.2% from €1.23 in the prior-year period, while preexceptional EBITDA totaled €1.14 billion, an increase of 23.8% from €920.0 million in 2018. The Darmstadt, Germany-based drugmaker's net sales increased 6.9% on an annual basis to €3.97 billion from €3.71 billion.
* Medicare recipients will now have access to innovative chimeric antigen receptor T cell therapies — which use a patient's modified immune cells to fight cancer — after the Trump administration cleared a final rule accepting the medicines for use in the program. The U.S. Food and Drug Administration has approved two of the therapies — Novartis AG's Kymriah and Gilead Sciences Inc.'s Yescarta — to treat certain types of blood cancers.
Medicare will now cover the therapies' use in healthcare facilities for cancers as approved by the FDA and for off-label use in cancers that are recommended by the Centers for Medicare and Medicaid Services. Off-label use is a common practice in the medical industry, where drugs are used to treat diseases that are not specifically approved for that condition.
On the policy front
* Moody's, in an Aug. 7 report, said it believes the U.S. Senate Finance Committee's drug pricing legislation proposal creates social and financial risk for pharmaceutical companies like Amgen Inc., Gilead Sciences and AbbVie Inc. due to their high exposure to U.S. markets. The rating agency said the draft Senate bill, introduced July 23, would also target drugs with high price increases in both Medicare Part D and Part B, representing pharmacy- and provider-administered drugs, respectively.
* China's National Medical Products Administration put tighter restrictions on the opioid painkiller oxycodone in a push to combat drug addiction, Reuters reported. The addictive drug will be classified as a psychotropic drug in some formulations, and more approvals will be needed to produce or prescribe the products.
* The U.K. government said its National Health Service will become an international leader in the use of artificial intelligence in healthcare as the country unveiled a slew of healthcare announcements, including allocating £250 million for a National Artificial Intelligence Lab, the Financial Times reported.
M&A and capital markets
* Boston Scientific Corp. will divest two of its microscopic bead products at the behest of the U.S. Federal Trade Commission ahead of the medical device company's planned $4.2 billion acquisition of London's BTG PLC. The FTC said the companies are the two largest suppliers of drug-eluting beads — used to treat certain liver cancers — and that the merger would violate federal antitrust law without the divestiture.
* Elanco Animal Health Inc. and Bayer AG's animal health unit are on track to close a potential deal, to be announced around the time of Elanco's second-quarter earnings release Aug. 13, Bloomberg News reported yesterday. Elanco intends to buy Bayer Animal Health using stock, among other payment methods, Bloomberg noted, citing people with knowledge of the matter. Bayer Animal Health could be worth as much as €8 billion in its sale.
Drug and product pipeline
* The U.K. National Institute for Health and Care Excellence recommended Puma Biotechnology Inc.'s neratinib as an additional treatment adults with early-stage hormone-receptor positive HER2-breast cancer who have undergone surgery to reduce the risk of their disease returning and are less than one year from completing treatment with Roche Holding AG's cancer drug Herceptin after surgery. Neratinib, taken daily for one year, is recommended if Herceptin is the only HER2-directed adjuvant treatment patients have received, the agency said.
* A U.S. FDA advisory panel has backed Gilead Sciences Inc.'s Descovy — a combination of FDA-approved HIV therapies emtricitabine and tenofovir alafenamide — for preventing HIV infection in men and transgender women, Reuters reported. At an advisory committee meeting yesterday, the panel voted 16-2 in support of the drug to be used for pre-exposure prophylaxis to prevent HIV in men and transgender women who have sex with men.
* Rhythm Pharmaceuticals Inc.'s experimental obesity drug setmelanotide was shown to reduce body weight and insatiable hunger, meeting the main goals of two late-stage trials. Setmelanotide's effect on two rare types of genetic obesity — pro-opiomelanocortin and leptin receptor deficiency — was examined in patients six years or older.
* Athenex Inc. said its oral cancer drug Oraxol reduced the size of tumors in more breast cancer patients whose disease has spread across the body compared to those who were only infused with chemotherapy. The study also showed that only 17% of patients on Oraxol showed nerve damage compared to 57% of patients on IV chemotherapy.
* A combination of Opthea Ltd.'s therapy OPT-302 with Roche and Novartis' Lucentis was found to be more effective in treating symptoms of wet age-related macular degeneration, or AMD — a chronic eye disorder — compared to Lucentis alone in a mid-stage study. Wet AMD is caused by abnormal blood vessels that leak fluid or blood into a part of the eye called the macula, causing blurred vision and rapid and severe vision loss.
* Scientists, studying mice, identified a subtype of T cells that may drive allergic disease and reactions — a development that may aid in preventing anaphylaxis in humans, according to S&P Global Market Intelligence's recurring column on early-stage research in animals. An eye-on-a-chip model and an animal model for hepatitis B research were also featured in the column.
* Novartis did not inform the U.S. FDA about inaccurate data on its gene therapy Zolgensma — a $2.1 million gene therapy for spinal muscular atrophy — while the agency was reviewing the drug for approval, even though the Swiss pharmaceutical giant had known as early as mid-March. "We tried to do the right thing in this instance," Novartis CEO Vas Narasimhan said in a call yesterday.
Novartis "proactively" informed the FDA of its findings June 28, Narasimhan said. The FDA conducted onsite inspections in early August, and the information was made public Aug. 6, with the regulatory agency stating that "civil or criminal penalties" may be appropriate.
* Otsuka Pharmaceutical Co. Ltd. said profit attributable to owners of the company rose 5.4% year over year to about ¥67.76 billion for the first half of fiscal year 2019, while EPS was ¥123.53, up from ¥117.90 in the year-ago period. The Tokyo-based drugmaker's revenue was ¥671.13 billion for the six months ended June, an 8.5% increase from the previous year — buoyed by the strong performance of therapies Abilify Maintena, Rexulti, Samsca and Lonsurf.
* Sarepta Therapeutics Inc.'s non-GAAP net loss came to 83 cents per share in the second quarter, compared with a loss of 43 cents per share in the year-ago period. Non-GAAP net loss widened by 118.6% to $61.2 million from $28 million in the prior-year period.
The day ahead
Early morning futures indicators pointed to a higher opening for the U.S. market.
In Asia, the Hang Seng rose 0.48% to 26,120.77, while the Nikkei 225 was up 0.37% to 20,593.35.
In Europe, around midday, the FTSE 100 rose 0.17% to 7,211.10, and the Euronext 100 gained 1.19% to 1,041.22.
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.
The Daily Dose has an editorial deadline of 6:30 a.m. ET. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.