With the pandemic in the rear vision mirror, patent cliffs...

With the pandemic in the rear vision mirror, patent cliffs approaching on numerous blockbuster drugs and growing cash piles, big pharma is entering acquisition mode again, according to analysts.

Big pharma was reported to have expressed urgency in their quest for deals during recent second quarter earnings calls. In preparation, pharma has recently been divesting assets to free up capital for redirection into areas with more potential growth.

The Inflation Reduction Act (IRA) is said to be playing a role in pharma development and acquisition decisions. The first round of drugs selected for forced price negotiation with the US government was recently announced and includes drugs marketed by the likes of J & J, Merck, Novartis, Eli Lilly, Amgen and Astra Zeneca. One pharma M & A expert is quoted in this recent article as saying that the price negotiation system should add value to rare disease treatments as they offer more certainty at this time.

“One of the unique provisions [of the IRA] is if you’re a single-indication, rare disease asset, you have permanent shielding. You’ll never be negotiating,” he said.

While PYC is still at early clinical stage, its focus on single-indication rare disease assets means it is in the right place at the right time.

In just 12 months’ time, the company expects to have two drugs in clinic, one of which will have already provided initial efficacy data, a third about to enter the clinic and one or two others moving though preclinical. All drugs are targeting monogenic diseases and thus have a much higher likelihood of making it through to market compared with standard small molecule drugs.

In the eyes of pharma, PYC's portfolio is likely to equate to a handy and attractive arsenal of IRA-shielded drugs.