Bluebird Bio, an organization that steered three gene therapies to FDA approval however struggled to commercialize them, has discovered the money it must put these therapies on stronger monetary footing by reaching a deal to promote itself to 2 non-public fairness companies for about $29 million.
Carlyle and SK Capital Companions have agreed to pay $3 in money for every share of Bluebird, the biotech introduced Friday. That worth is a 57% low cost to the corporate’s closing inventory worth Thursday. The deal is closely backloaded. Bluebird shareholders might obtain $66.8 million extra, however provided that the corporate’s gene therapies obtain a specified gross sales objective.
When the deal closes, Bluebird can be led by new CEO David Meek, whose business expertise consists of the chief government roles at Mirati Therapeutics and Ipsen. Bluebird mentioned Carlyle and SK Capital will present the biotech with the first capital to scale the business supply of its gene therapies, expensive one-time remedies that supply sufferers a possible treatment.
Whereas Bluebird has been producing income from its FDA-approved gene therapies, it has additionally relied closely on a selected monetary car to cowl bills, such because the manufacturing of those complicated therapies. The 2022 FDA approvals of Zynteglo, for the uncommon blood dysfunction beta thalassemia, and Skysona, for the ultra-rare neurological illness cerebral adrenoleukodystrophy, every got here with a precedence evaluation voucher. These vouchers are usually awarded to a brand new remedy that’s first to deal with a uncommon illness. The voucher program was meant to encourage extra uncommon illness drug R&D, and firms awarded PRVs might apply them towards speedier FDA evaluation of a future uncommon illness remedy. Nonetheless, biotechs usually view these vouchers as non-dilutive financing that’s monetized by promoting them to massive pharma corporations at costs topping $100 million.
Bluebird discovered patrons for the PRVs awarded for the Zynteglo and Skysona approvals. However the 2023 FDA approval of Lyfgenia in sickle cell illness didn’t include a voucher. That approval was introduced concurrent with the regulatory nod for Casgevy, a Vertex Prescription drugs gene remedy for a similar indication. Casgevy’s approval did include a PRV. Monetary analysts who comply with Bluebird famous that missing a voucher to monetize would make commercialization of Lyfgenia difficult.
In 2024, Bluebird entered a collection of debt agreements to help its operations. The corporate additionally appealed the FDA denial of a PRV for Lyfgenia. The company denied the biotech’s appeals 3 times. Final September, Bluebird carried out a restructuring that minimize 94 staff, representing about 25% of its workforce. As of the tip of the third quarter of 2024, Bluebird reported its money place was $70.7 million. The corporate projected it will find the money for to final into the primary quarter of 2025. The dwindling money put the corporate susceptible to defaulting on its loans.
Bluebird mentioned Friday that the sale settlement follows a complete evaluation that included assembly with greater than 70 potential buyers and companions over the course of 5 months. The board of administrators decided that and not using a important infusion of capital, Bluebird was susceptible to mortgage default, leaving acquisition by Carlyle and SK Capital as “the one viable resolution to generate worth for stockholders.”
“After an in depth evaluation course of, this acquisition represents the perfect path ahead — maximizing worth for stockholders and bringing important capital, business experience, and a dedication to offer extra sufferers the chance to profit from doubtlessly transformative gene therapies,” present Bluebird CEO Andrew Obenshain mentioned in a ready assertion.
Past the upfront fee, Bluebird shareholders might obtain $6.84 extra per share beneath a contingent worth proper (CVR) included within the settlement. Shareholders will get that money if the corporate’s gene therapies obtain $600 million in internet gross sales in any 12 consecutive month interval as much as the tip of 2027.
To William Blair analyst Sami Corwin, the chance of Bluebird attaining the CVR income objective is low. In a be aware despatched to buyers, Corwin mentioned her agency fashions Bluebird internet gross sales of $282.9 million for this yr, $409.4 million for 2026, and $546.4 million for 2027. She mentioned Bluebird’s dwindling money and distance from profitability made a transition away from the general public markets probably inevitable. However she additionally famous the hefty low cost of the acquisition worth, which led to the inventory buying and selling down about 40% following the announcement of the deal.
The Bluebird acquisition, which nonetheless wants the customary approvals, is anticipated to shut within the first half of this yr. When the transaction is full, Bluebird shares will not be publicly traded.
Pfizer’s Gene Remedy Pullback Continues With Termination of Beqvez
Bluebird Bio isn’t the one firm with gene remedy commercialization challenges. Pfizer is discontinuing improvement and commercialization of hemophilia B gene remedy Beqvez lower than a yr after it landed FDA approval.
In an announcement to Nikkei Asia, which was first to report the event Thursday, Pfizer cited restricted curiosity from sufferers and physicians. That tracks with the experiences of CSL Behring, which markets the hemophilia B gene remedy Hemgenix, and BioMarin Pharmaceutical, maker of the hemophilia A gene remedy Roctavian. Pfizer’s discontinuation of Beqvez comes two months after the pharma big gave Sangamo Therapeutics a termination discover for the partnership on a hemophilia A gene remedy that was being ready for an FDA submission.
Pfizer has been culling gene remedy from its portfolio and pipeline. In 2023, the pharma big offered its preclinical gene therapies to Alexion, the uncommon illness subsidiary of AstraZeneca. Final summer time, Pfizer introduced the discontinuation of its gene remedy for Duchenne muscular dystrophy, a transfer that adopted a Part 3 failure.
Hemophilia sufferers nonetheless have therapy choices. Infusions of clotting proteins and common dosing of sure medication could also be continual therapies, however sufferers are accustomed to them and apparently, snug persevering with with them relatively than choosing the costly however one-time therapy from gene remedy. Regardless of Pfizer’s pullback from gene therapies for hemophilias, the corporate nonetheless has a presence in these blood problems. Final October, the FDA accredited Hympavzi, a once-weekly injectable antibody drug that Pfizer developed as a therapy for each hemophilia A and B.
Photograph: crazydiva, Getty Pictures
