Episode 182 - May 8, 2026

Summary

• The panel reads the record secondary-offering wave as healthy early-cycle behavior, not froth. Eric Schmidt notes Q1 was a record quarter for biotech secondaries and says “it seems like we’ve now reached the point where it’s an automatic raise and a very large raise for anyone who has good results,” citing Cytokinetics, Avalo and Artiva. Paul Matteis stresses the raises follow better-than-expected data, not FOMO — “This does not feel at all like twenty twenty” — though Josh Schimmer warns that without sustained generalist interest, “paper can kill a biotech rally.”
• Three more takeouts land: Angelini buys Catalyst Pharmaceuticals for $4.1B, Bayer buys Perceive Biotherapeutics (~$300M upfront), and UCB pays $2B upfront for Candid Therapeutics. Candid — Ken Song’s second company acquired before he could become a public-biotech CEO (“the universe just won’t allow it”) — spotlights the opportunity in China-sourced assets. Allison DeAngelis flags rising premiums and doubts about whether China’s ecosystem “will kill bad programs,” while Josh worries innovation there is “almost too fast” for investors to underwrite.
• Commercial-stage biotech is in the penalty box while investors chase “buy the dream” developmental stories. Paul says 2025 was the commercial-biotech year, but leading names including Alnylam, Insmed, argenx and Verona are now laggards; Vertex and Biogen were favored because of pipeline events. BioMarin is cheap on a conservative valuation, yet ignored without a “golden pipeline ticket.” Eric’s Agios thalassemia launch “crushed expectations” — 2026 consensus may be threefold too low — while the stock rose about $2 because investors want “open-ended five- to 10-bagger upside,” not 20% earnings revisions.
• FDA dysfunction dominated: Sanofi asked to pull teplizumab from the Commissioner’s voucher program after, according to what Lizzy Lawrence heard, acting CDER head Tracy Beth Høeg disagreed with a staff decision to approve the drug. The April 21 decision date passed, and the same week Makary defended the principle that senior officials should not intervene in review-staff decisions. Eric highlights the irony against Replimune’s twice-rejected RP1 and Atara’s EBV cell therapy, whose rejection he says was seemingly tied to Vinay Prasad; Atara now has an opportunity to refile with Pierre Fabre “despite not having any new data.”
• Makary’s job itself is now a coin flip — Eric cites Kalshi odds of roughly 50/50 that he makes it through the end of the month. Allison details Wall Street Journal reporting about White House pressure to approve grape-flavored vapes Makary initially opposed, which were approved this week; an agency that laid off 3,500 people and now aims to hire 3,200; and a WSJ op-ed urging Trump to “pull the plug.” It also remains unclear whether Makary or the White House will choose the next CBER head.
• The hosts split on why this FDA draws unprecedented fire. Yaron Werber says scientific credibility and public trust have eroded amid anti-vaccine and COVID-related political overtones. Eric agrees that vaccine-related actions are antiscientific and says political conduct from agency leadership undercuts “the entire tone from the top.” Josh pushes back that Prasad’s CRLs were “brilliant, really very thoughtful” judgment calls and points to pressure from HHS leadership: “if you’re not gonna play that ball, you have no job.”
• Data week: Cytokinetics’ aficamten ACACIA readout in non-obstructive HCM showed a KCCQ effect that “wasn’t huge… but maybe good enough” in a huge market, and Artiva posted ACR50 scores in the 70% range in RA with responses that deepen over time — plus an FDA-agreed pivotal path versus Rituxan. Clene’s neurofilament-based ALS path reopens the biomarker debate: Paul is a believer (“a metabolite of dead or damaged neurons”) but notes uncertainty about the magnitude and significance of Clene’s reductions, as well as the FDA’s different treatment of Denali’s NfL data.
• Closing scuttlebutt: the ivonescimab flyers circulating ahead of ASCO (2.5–3 weeks out) may, according to Eric’s sources, have originated with Keso, who is said to have originated the artwork. Eric’s call: “My guess is it’ll be quite good on the overall survival endpoint.”

Deep dive

1. Record secondaries aren’t a 2020 rerun — yet

• Eric’s setup: Q1 was “a record quarter for biotech secondaries,” and this week piled on more hundreds-of-millions deals — Cytokinetics, Avalo and Artiva. “It seems like we’ve now reached the point where it’s an automatic raise and a very large raise for anyone who has good results in this space.”
• Josh’s caveat is context-dependence: when generalists come in they dwarf everyone, funding companies while containing momentum; without them, “paper can kill a biotech rally in my view.”
• Paul’s read: the mega-raises follow data that’s “really good and better than expected,” not opportunistic FOMO, and M&A has left specialists and long-onlys with cash to deploy — “This does not feel at all like twenty twenty.” Yaron concurs: healthy early-cycle recovery, with even generalists willing to go “down into kind of mid-cap biotech land” — Insmed, Roivant, Ionis and Arrowhead.

2. Three deals, and Candid caps the China-asset wave

• Allison’s tally: Angelini Pharma acquiring Catalyst Pharmaceuticals for $4.1B; Bayer buying Perceive Biotherapeutics (~$300M upfront and close to $2.5B in biobucks); and UCB buying T-cell-engager shop Candid Therapeutics for $2B upfront. Ken Song’s second company was acquired before he could become a public-company CEO — RayzeBio went public and was acquired roughly 2–3 months later, while Candid’s planned reverse merger is now off: “the universe just won’t allow it.”
• Josh’s gloss: Candid “got some very compelling cheap assets out of China, and they quickly turned it into a huge payday” — and his recent China biotech bus tour was “so eye-opening.”
• Allison’s caution: premiums for China assets have risen, and the incentive structure there “is to do a lot and produce a lot” — will they kill bad programs? Josh’s twist: the innovation is “almost too fast” — pull out today’s best asset and “the next day, the next week, the next year, there might be something better,” leaving investors unable to underwrite the landscape.

3. Commercial biotech is out of favor — it’s a buy-the-dream year

• Paul’s frame: 2025 was the commercial-biotech year; leading companies including Alnylam, Insmed, argenx and Verona now lag, while Vertex and Biogen entered the year in favor because of pipeline events. BioMarin “on an actual, conservative valuation methodology is not expensive,” yet interest is muted without an “immediate golden pipeline ticket” — perhaps only an Alexion-type “this just got too cheap” acquisition flips sentiment.
• Eric’s specimen: Agios’s thalassemia launch “could not be going better” — 2026 consensus is “probably gonna be about threefold too low” — and the stock rose about two dollars. “We’re in a bit of a buy-the-dream phase… everyone wants that open-ended five- to 10-bagger upside… as opposed to, ‘Hey, let’s grind higher with 20% earnings upward revisions.’”
• Yaron’s mechanics: expectations “emanate from the actual market cap,” Q1 seasonality is real, and usually there is a big bounce-back in Q2. Jolted generalists in Alnylam, Insmed and argenx are asking, “What the hell did we just buy, and why is this down 15% in the last two weeks?” Higher drug pricing, meanwhile, means launches become meaningful drugs faster. Josh’s coda: “the more companies run their companies for generalists, the better the sector is gonna do.”

4. Teplizumab, Replimune, Atara: a week of regulatory whiplash

• Per STAT’s Lizzy Lawrence, via Allison: Sanofi asked the FDA to pull teplizumab from the Commissioner’s voucher program after its April 21 decision date passed. What Lizzy heard is that the move came after Tracy Beth Høeg, acting CDER head, disagreed with a staff decision to approve the drug. Sources say voucher-program drugs are “vulnerable to political influence.”
• Eric’s irony: the same week, Makary went on CNBC defending the view that senior officials should not intervene in review-staff decisions — calling it “disastrous” when they do — while discussing the twice-rejected Replimune RP1, which has clear activity in melanoma. Meanwhile, Atara’s EBV cell therapy was rejected after Vinay Prasad wrote in JAMA that cell therapies should not be approved on single-arm studies; Eric says that rejection was seemingly tied to Prasad. Atara now has an opportunity to refile with Pierre Fabre “despite not having any new data.”
• Josh invokes Pazdur — “he didn’t leave the FDA, the FDA left him” — while noting Pazdur’s optimism that enough appropriately oriented decision-makers remain and “the wheels have not fully fallen off the agency’s bus.”

5. Makary at 50/50

• Allison on the fever pitch: Bloomberg and the Wall Street Journal reported on personnel chaos; the WSJ reported White House pressure to approve grape-flavored vapes Makary initially opposed on child-appeal grounds — approved this week anyway; an agency that laid off 3,500 people last year now aims to hire 3,200; and a WSJ op-ed said it was time for Trump to pull the plug. Eric says Kalshi puts Makary’s odds of making it through the end of the month at “about 50/50.”
• Paul asks who picks the next CBER head, and whether rare-disease flexibility or vaccine unorthodoxy matters. Allison’s read: it may not be Makary’s pick at all; White House confidence in his ability to set up a leadership team is “on thin ice.”

6. Why does this FDA draw so much fire? The hosts split

• Josh’s framing question: the FDA has always made controversial calls and quietly converted CRLs to approvals — “why is there so much scrutiny to this FDA’s decision-making process compared to prior FDA leadership?”
• Paul’s factors: defiant, specific public defenses, including going on television about uniQure procedure morbidity, and “this many real-time contradictions in a matter of weeks or months.” He cites uniQure’s three-year data followed a week later by FDA-published guidance; Yaron specifies the discussion involved open-label studies and natural-history controls. Paul also expected a Republican administration to be “somewhat more libertarian,” but says “this has been the opposite.”
• Yaron says the issue is science and trust: when the public believes decisions are rigorous and science-based, the agency gets the benefit of the doubt; anti-vaccine and COVID-related political overtones have weakened that credibility. Eric agrees that vaccine-related conduct is antiscientific, cites an article saying the FDA suppressed an internal vaccine-safety report, and says leadership that acts politically undercuts “the entire tone from the top.” Josh pushes back: Prasad’s CRLs were “brilliant, really very thoughtful” judgment calls, not anti-science, while pressure from HHS leadership is a central context — “if you’re not gonna play that ball, you have no job.”
• Yaron’s synthesis: an outsider sea change is not inherently negative, but this one was “scorched earth” — policies were “crafted aspirationally very quickly, and then very poorly translated into practice.” Pazdur was a maverick too — accelerated approvals, Velcade and “the magical 20%” — but with strong scientific judgment. Allison adds the voucher program’s unanswered selection criteria, published CRLs but vanishing AdComs: “the flow of information out of the agency has also changed.”

7. Data: aficamten threads a needle; Artiva’s responses deepen

• Paul on Cytokinetics’ ACACIA in non-obstructive HCM: mavacamten failed here but was “pretty close,” so many investors were positioned positively. The KCCQ effect “wasn’t huge in the grand scheme of things, but maybe good enough,” with debate around safety and EF; laterals include polarizing Edgewise, which might be better or might have its own AFib issues, and private Braveheart. It is a huge market, and the stock is “well over 100% off the bottom” after reported M&A talks fell through years ago.
• Josh on Artiva’s AlloNK plus fludarabine, cyclophosphamide and rituximab: ACR50 scores were “in the 70% range” in RA, and — unlike CAR-Ts and bispecifics that start strong and fade — “the product profile actually got better as they followed patients longer.” Artiva also has an FDA-agreed pivotal path versus Rituxan, with a profile that avoids the need to manage CRS or ICANS and could be more usable in community rheumatology.
• Eric probes RA as first indication versus myositis and MG; Yaron flags the Sjögren’s data. Josh’s big picture: Otezla is still a multibillion-dollar psoriasis drug, so “there should be a seat at the table for differentiated products” — first-mover advantage matters, and ACR scoring itself is “a quagmire.”

8. Neurofilament flip-flops, J&J spin, and the ivonescimab flyers

• Paul on Clene’s ALS path, which Adam Feuerstein criticized: tofersen’s SOD1 study failed to beat placebo after what Paul thinks was only about six months — “insane for disease modification in neurodegeneration” — but longer follow-up suggested better performance than natural history and reduced NfL by roughly 40%. Paul’s conviction: “neurofilament is a metabolite of dead or damaged neurons,” with broad supporting evidence, though he does not know whether Clene’s reduction is unequivocal. Roche’s Huntington’s program offers counterevidence: the drug did worse than placebo and NfL was elevated on treatment.
• Josh’s puzzle: the FDA would not consider Denali’s NfL data and focused exclusively on heparan sulfate — “what changed between a year ago and today?” Paul notes Denali dealt with a different group, while the exchange identifies both Denali and tofersen as CDER cases.
• J&J’s DUET study of Tremfya plus Simponi was a closely watched follow-up to a 2022 study suggesting the first combination therapy in development for UC and Crohn’s could potentially double the effect. DUET missed its primary endpoint but advances to phase 3 in patients who failed two or more treatments; the team pitched it to Allison as “overwhelmingly positive.” Josh is perturbed by what he sees as J&J’s overly bright framing, recalling its Inlexzo reporting and attempts to criticize CG Oncology. Yaron says the data undershot expectations, with TNF “the weaker of the mechanisms,” but combinations are not dead. enGene’s NMIBC immunostimulant update also fell short of expectations, and the stock was down a little.
• The closer: Eric on the ivonescimab flyers — ASCO is 2.5–3 weeks away and “my guess is it’ll be quite good on the overall survival endpoint.” Who made the flyers is “the sixty-four-thousand-dollar question”; his sources suggested that Keso originated the artwork.