Episode 201 - October 30, 2026

Summary

• Pharma’s deal appetite remains intact, with early-stage assets and China firmly in the sourcing mix. Sam highlighted Lilly’s continued early/clinical-stage strategy, Bristol Myers’ $13 billion in cash and securities, and Novartis’ preference for bolt-ons below $2 billion. Sanofi’s emphasis on “faster translational efficiency” reinforced China’s attraction, although active term sheets do not guarantee Q4 closings.
• Alnylam’s commercial disappointment shows how quickly clinical success can lose its valuation cushion. Graig cited Amvuttra sales of $81 million in the quarter, down from $129 million in Q2, and a second franchise guidance cut; shares were down about 30% over the week and 60% year to date. Sam separately corrected his BeiGene comment: Brukinsa revenue was $1.13 billion, and he had mischaracterized U.S. demand in the quarter as declining.
• AI’s demonstrated workflow gains have not removed the clinical-development bottleneck. Sam described replacing two or three data-gathering contractors, but Brian’s counterexample remained a 10,000-patient cardiovascular study taking five years and $300 million: efficiencies would “not accelerate things by 90%.” Yaron pointed to Amgen’s 16-month trial enrollment, crediting AI-assisted patient and site identification.
• A reopening IPO market still requires discrimination between financing access and investment returns. Graig counted approximately 31 biotech IPOs, including renewed appetite for phase 1 companies, but estimated at least half traded below issue price; Eikon had fallen from $18 to about $5. Chris hoped biotech “might be seen as a safe haven” from tech’s AI-spending concerns, while Sam warned that hypothetical geopolitical escalation and renewed tariffs could lift rates.
• Rare-disease regulatory flexibility offers encouragement without solving the funding problem. Chris welcomed FDA efforts to “codify the flexibility” around small trials, evidence standards and manufacturing. Plowshare’s $7 million philanthropic/angel round illustrated community support, but substantial institutional capital would still be needed; Palvella’s review timeline provided another concrete positive.
• IgA nephropathy supplied unusually strong evidence of disease modification. Brian highlighted Voyxact’s two-year VISIONARY results: essentially flat eGFR, one composite kidney event versus 28 on placebo, and no kidney-replacement cases versus five. He described this as having “stopped disease progression,” while distinguishing those mature results from programs still awaiting longer-term kidney-function data.
• ESMO strengthened Amgen’s small-cell franchise and Genmab’s answer to its royalty cliff. Sam called DeLLphi-304 “practice-changing”; the Genmab discussion framed three pipeline readouts as potential foundations for growth through the 2029–30 Darzalex royalty decline. Genmab shares had doubled in three months, with three prospective blockbuster launches envisaged by late 2027/early 2028.
• Strong combination efficacy does not eliminate development and partnering risk. Yaron argued that Tango’s PRMT5 inhibitor tripled exposure to Revolution Medicines’ RAS drug, creating dose, labeling and pricing complications. BMS’s formal collaboration and expected absence of that interaction made it a formidable competitor. Sam said he had intended to discuss Tango and PRMT5 inhibitors, but the conversation ended before he did.

Deep dive

1. Pharma buyers remain active without promising imminent closings

• Sam’s reading of pharma earnings was continued engagement: Lilly remained focused on early and clinical-stage deals, particularly immunology, neuroscience and oncology. Bristol Myers stayed agnostic on transaction size, prioritized business development and cited $13 billion in cash and marketable securities, plus debt access. Its approach was to transact “as things come through,” rather than wait for one particular opportunity.
• Novartis still preferred bolt-ons below $2 billion, with larger transactions selective; Sam did not think the Avidity trial news had changed that philosophy. One VC had described four or five companies at term-sheet stage, supporting Chris’s optimism approaching Jefferies and JPMorgan. Sam retained the timing caveat: “whether those deals close in Q4, who knows?”
• Sanofi’s China commentary mattered because it made the operational argument explicit. Sam highlighted its description of a “thriving hub for scientific advancement” and R&D’s emphasis on “faster translational efficiency.” An established regional commercial presence also supported manufacturing and drug-development partnerships: this was pharma explaining China’s advantages directly.

2. Alnylam and IPO dispersion expose the limits of market optimism

• Graig said Amvuttra sales were $81 million in the quarter, versus $129 million in the second quarter—a meaningful decline in a competitive landscape. The CEO called the results unsatisfactory despite underlying growth demand, and the franchise received its second guidance cut of the year despite an expanded sales force. Separately, Sam corrected his BeiGene comment: Brukinsa revenue was $1.13 billion; he had erroneously described U.S. demand in the quarter as declining.
• With Alnylam shares down about 30% over the week and 60% year to date, Graig distinguished scientific accolades from commercial execution: “the rubber hits the road.” Chris relayed chatter on X that the company had not used its stock currency and position of strength to acquire pipeline diversification.
• Graig’s unofficial IPO count reached 31, approaching a previously discussed forecast of 50. Protein-degrader company Lycia Therapeutics rose about 60% intraday on debut before finishing roughly 30% higher. The day’s phase 1 offerings, Bamboo Therapeutics in immunology and Aspen Neuroscience in Parkinson’s cell therapy, suggested investors would still finance earlier development.
• That appetite coexisted with weak aftermarket performance: Graig estimated at least half the year’s offerings traded below issue price. Eikon, which he covered, had fallen from February’s $18 IPO to about $5 despite a good update at ESMO and more than $500 million in cash. Chris noted that some believed its platform-led valuation had been high, distinguishing it from product-driven offerings.

3. AI improves execution while human studies retain their time cost

• Brian highlighted Anthropic’s S-1 emphasis on life sciences, its April acquisition of computational biology company Coefficient Bio, and its acquisition of Methyl Medicine, a one-person biotech run by Cody Tranbarger, who revealed himself as “Professor Oak.” Chris connected this with an existing operating shift: venture-backed companies reaching pivotal studies with around 20 employees, and one approaching phase 2 with a single full-time CEO. AI could reinforce smaller teams rather than create that trend.
• Yaron described Bruce Booth’s distinction between generating molecules against validated targets and understanding novel human biology: more discovery output could crowd the entrance to clinical development, though infrastructure could absorb more assets. Chris added that clinical-trial capacity remains limited. He also reconsidered the maxim that “chemists with computers are going to replace chemists without computers.” For finding new IP around scaffolds and targets, he was beginning to question whether computers might replace chemists themselves.
• Sam already found AI could displace two or three contractors gathering and sifting data, while retaining human quality control. Population and biobank data offered potential biological insight. Yaron said AI could help identify protein–protein interactions, understand protein structure and movement, and find undruggable targets, while emphasizing the need for wet-lab work at scale. Brian’s warning was “garbage in, garbage out”: fast information processing still produces mistakes, and claims to “cure all diseases in 10 years” invite skepticism.
• Chris also emphasized the lack of good translational models: for new targets, success still has to be tested in human clinical studies. Brian’s bottleneck was a 10,000-patient cardiovascular outcomes study taking five years and $300 million: efficiency would “not accelerate things by 90%.” Graig hoped better patient selection could improve probability of success, while study duration remained fixed. Yaron pointed to Amgen’s lipoprotein(a) study, enrolled in 16 months versus about a year and two months longer at Novartis, crediting AI-assisted patient identification and site mapping.

4. A biotech rotation remains vulnerable to higher rates

• Chris saw a possible rotation as big tech funded an “unproven AI buildout.” He cited Amazon’s $220 billion in expenses for AI data-center buildouts, Alphabet losing 13% of its market value—about $500 billion—on an earnings disappointment, and Microsoft announcing layoffs or offering packages to 27% of its workforce. He also cited a roughly $6.3 billion crypto heist involving Bitcoin taken from Binance hot wallets. Chris said tech was facing an “existential crisis” as investors questioned whether AI spending would produce better revenue and profits, and suggested biotech “might be seen as a safe haven.”
• Chris also cited more than 50 novel FDA approvals and 10 potential remaining decisions as grounds for an unusually strong approval year despite leadership churn. Sam’s pushback was conditional: rumors of a post-midterm attack on Iran could imply retaliation, higher oil prices and higher rates; renewed tariffs could add inflation. “I know nothing,” he stressed, attributing the scenarios to others. His investment mechanism was straightforward: sufficiently high risk-free returns make parking money in a Treasury more attractive, and biotech cannot assume immunity.

5. Rare-disease flexibility still needs financing and successful trials

• Chris welcomed FDA’s rare-disease pathway meeting and a more standardized, “fit-for-purpose” approach across CDER and CBER. The agenda included small-sample statistics, enrollment constraints, real-world evidence, patient and expert input, and flexible manufacturing requirements. The aim was to “codify the flexibility that they’ve always signaled”; the open comment period ran through December 12.
• Plowshare’s $7 million angel/philanthropic round illustrated both community commitment and the capital gap. Its maple syrup urine disease program addressed a condition in the Amish-Mennonite Plain community in Pennsylvania. CEO Kevin Strauss led the Clinic for Special Children and had ties to the Lancaster community, where he had helped with access to Zolgensma for SMA. Chris saw potential across concentrated inherited disorders, but emphasized that institutional investors would ultimately need to finance clinical development “through the finish line.”
• Graig highlighted Palvella’s QTORIN rapamycin for microcystic lymphatic malformations: approximately 30,000 U.S. patients by the company’s estimate, potentially as many as 95,000, with no FDA-approved therapy. Its 505(b)(2), non-new-molecular-entity application had roughly six months from filing to decision, or four months after acceptance. Graig said “there’s going to be an approval here,” and cited potential across three other indications.
• Acumen supplied the opposite outcome: its phase 2 Alzheimer’s antibody, which targeted beta-amyloid oligomers rather than necessarily plaques, failed, and shares fell 80%. Graig said the result might underscore whether sponsors need a brain shuttle, especially for antibodies; this candidate had not used one. Chris’s enthusiasm remained conditional: shuttles could open disease areas “if we can get it to work.”

6. IgA nephropathy moves from surrogate improvement toward kidney outcomes

• Brian described a field transformed from relative neglect: roughly 200,000 diagnosed U.S. patients, with IgA-driven inflammation causing progressive scarring. His strongest interest was in reducing the causative antibodies. Voyxact’s two-year VISIONARY results extended its proteinuria-based interim approval with essentially flat eGFR against steady placebo deterioration: “basically this drug stopped disease progression.”
• The newly disclosed composite kidney-event result carried a hazard ratio of 0.029: one event on treatment versus 28 on placebo. Kidney-replacement therapy occurred in no treated patients versus five controls. Brian also emphasized the apparently favorable safety profile and low-dose, once-monthly subcutaneous administration; his enthusiasm concerned the observed two-year course.
• Vera’s atacicept also improved outcomes and slowed eGFR loss. Vera’s povetacicept showed similar interim proteinuria results, with an approval decision about a month away but longer-term eGFR still outstanding. Whether BAFF inhibition adds benefit to APRIL inhibition remained debated. A co-host who covers Climb Bio noted that its earlier-stage CLM-116 data were consistent with those of Chinese partner Mabworks, but it had neither proteinuria nor eGFR results yet.

7. ESMO’s strongest small-cell result contrasts with exploratory vaccine signals

• Sam treated Moderna’s pancreatic vaccine poster cautiously: only around 19–20 patients, and comparison with BioNTech’s early study lacked rigor. Still, about half generated 34 new antigens despite pancreatic cancer’s low mutation burden. A 17% tissue-insufficiency rate matched melanoma. The antigen yield gave him more hope for upcoming studies in generally higher-mutation-burden tumors.
• Yaron emphasized that BioNTech’s platform differed: 20 rather than 34 new antigens, unmodified mRNA and delivery without Moderna’s lipid nanoparticles. Its shareholders were split over retaining cancer vaccines versus reducing spending and concentrating on the broader pipeline. He favored pipeline focus, highlighting PD-1/VEGF, CTLA-4 lung-cancer data and a HER2 ADC.
• Amgen’s DeLLphi-304 was Sam’s clear “practice-changing” result. He cited 21.1 months in the overall-survival data while noting approximately 16 months’ median follow-up and substantial censoring after month 12. He was “pretty convinced” DeLLphi-312 would also succeed, resetting the first-line small-cell lung-cancer setting and raising the competitive bar for subsequent drugs.
• Yaron described the CD3 bispecific tarlatamab’s “long survival tail.” DLL3 ADCs had higher response rates, with durability and tolerability the concern, although newer results looked encouraging. Amgen’s collaboration testing Zai Lab’s ADC, which binds a different epitope, suggested a possible combination strategy as tarlatamab became entrenched.

8. PD-1/VEGF gains support as Genmab builds beyond royalties

• Sam welcomed China’s first-line biliary-tract-cancer results for ivonescimab plus chemotherapy: overall and progression-free survival improved against the Imfinzi control, which itself performed well. It was another “tick in the box.” He expected Western benefit but left the patient groups unresolved ahead of HARMONi-3. Yaron anticipated tumor-specific outcomes: some standards of care, others “a bit of a wash.”
• In the Genmab discussion, the speaker described frontline Epkinly’s 51% reduction in progression or death as a “complete home run.” Rina-S then beat Elahere in ovarian cancer, with a claimed “60 to 70% reduction in the risk of death,” activity across expression levels and activity after Elahere failure. The speaker expected second-line leadership and a race with Lilly into frontline treatment.
• Genmab’s Merus-acquired head-and-neck program added another phase 3 “home run.” The speaker cited a 50% reduction in the risk of death and activity regardless of HPV status, while noting only topline data were available. Shares had doubled in three months. The speaker argued the three programs could bridge the 2029–30 Darzalex royalty cliff, with three prospective blockbuster launches by late 2027/early 2028 and growth continuing through that transition.

9. Tango’s combination promise meets pharmacokinetic and partnership constraints

• The opening assessment of Tango’s vopimetostat PRMT5–RAS combination data in pancreatic cancer was positive. Yaron said efficacy was “phenomenally good,” but argued that Tango’s PRMT5 inhibitor increased exposure to Revolution Medicines’ RAS drug threefold, creating a separate problem: using roughly one-third of the RAS drug’s dose raises pricing and labeling questions. Tango also lacked a formal supply arrangement and would need to purchase the partner drug.
• Yaron contrasted this with BMS’s PRMT5 inhibitor and formal partnership: BMS would co-develop the drugs globally, had a supply agreement, and was not expected to have the same drug-drug interaction. He also cited BMS’s pace, its more advanced lung-cancer monotherapy work and its own RAS agents in phase 1. Sam said he had intended to add comments on Tango and PRMT5 inhibitors, but the conversation ended before he did.