As Prescribed


It is hard to believe that we are already in February and it has been a month since the 42nd Annual JP Morgan Healthcare Conference in San Francisco wrapped. It was a packed four days in which the major players in the life sciences industry gathered to make deals, form relationships, and discuss upcoming trends for the pharmaceutical and biotechnology industry.

For those who may not have attended or for whom the week was a blur (or distant memory), below are some key takeaways in the areas of FDA regulation and corporate transactions from some of the events surrounding the conference. This includes an event held by STAT News during which the Director of the FDA Center for Biologics Evaluation and Research (CBER) Dr. Peter Marks spoke, as well as multiday discussions held by Endpoints News that included major industry speakers.

FDA Regulation

  • FDA’s messaging appears to be one of aiming to enable innovation, rather than to serve as an impediment to industry. In multiple presentations and discussions throughout the week, as well as in a number of guidance documents issued by FDA in 2023 (see our 2023 year in review report for further information), it was made clear that FDA wants to work with industry to find new ways to meet patient needs. However, for this to happen, FDA needs industry to come to the agency and educate it on any particular proposal, whether it be new clinical trial tools or designs, new product constructs, or new manufacturing methods.
  • “Regulatory flexibility” is shaping up to be a key phrase going into 2024. For example, CBER Director Dr. Marks discussed a hypothetical where a product may be able to be approved on the basis of persuasive secondary endpoints, as opposed to the north star of statistically significant primary endpoints, especially in the rare disease space. While regulatory flexibility has always been an FDA refrain for rare and serious diseases, exactly how the increased discussion of regulatory flexibility will play out over the next few years remains to be seen.
  • Despite several news stories over the last few years regarding the accelerated approval program, Dr. Marks reiterated strong and continued support for the pathway. Interestingly, Dr. Marks noted that, by design, the pathway is one through which FDA is able to take some risks with respect to efficacy and stated that a small, but expected failure rate should be anticipated in confirmatory trials. We will be keeping an eye on how this risk-taking is implemented as new therapies are developed and as the use of accelerated approval continues to expand to other therapeutic areas, including in areas such as progressive or degenerative diseases where there may be narrow treatment windows.
  • In other comments made during the events, it appears as though FDA continues to be interested in cell and gene therapies, the potential impact of GLP-1 agonists (which were a point of much discussion throughout the week in general), as well as developments and treatments for neurological diseases.

Corporate Transactions

  • Participants were impressed with the strength of the biopharmaceutical merger and acquisition (M&A) market in 2023, especially in the second half of the year; and Centerview Partners stated that deals in 2023 had become more competitive, with numerous bidders lasting longer throughout the bidding process. Stakeholders remained optimistic about an uptick in M&A activity in the biopharmaceutical sector in 2024 due to (1) many pharmaceutical companies having large cash reserves on hand, (2) impending patent cliffs for several blockbuster drugs, and (3) resetting of corporate valuations to the more normalized pre-pandemic levels.
  • There was a general sentiment that increased venture capital funding will be available for biopharmaceutical companies in 2024, particularly in the second half of the year. However, many investors suggested that they will be more selective with their investments and will expect companies to run with leaner corporate budgets and product pipelines focused on progression of lead assets. Assets and clinical data are expected to continue to dominate investments as opposed to broad platform plays.
  • The key indications that were deemed ripe for investment in 2024 include (1) obesity and other metabolic conditions (due to the success of the GLP-1 agonists), (2) neuroscience, and (3) radiopharmaceuticals. In addition, there was much discussion about the potential benefits that artificial intelligence (AI) will bring to the life sciences industry, ranging from cheaper or more efficient drug design to more effective enrollment of patients in clinical trials. Key to all of these discussions was the notion that the outcomes from AI will be based on the quality of the data that is utilized in the various models. Therefore, we believe that we will see significant investment into AI companies in 2024, including from large technology companies, as the convergence between technology and life sciences continues.
  • Pharmaceutical executives noted that potential biotechnology partners should be transparent when presenting their assets for a prospective transaction, as this will help build trust between the parties, which is essential for a successful collaboration.
  • Many panels also discussed the need to take other factors into account when considering whether an innovation is worthy of further development or investment. For example, some participants noted that true innovation must be accompanied by advocacy to ensure that a market will develop for innovation, as many effective therapies today are not accessible to a large portion of the population. Others noted that ethics must be considered when developing devices that interact or alter the brain, given that such innovations may have the ability to change an individual’s overall personality. Finally, we continued to see informative discussions about the need for greater health equity and models that are being developed to address the disparities in the health system.

All and all, 2024 seems to have started with a bang and should bring a number of exciting developments and cautious optimism. Only time will tell how events plays out over the course of the year, but we here at Morgan Lewis will be following the developments and keeping readers up to date every step of the way.