Post by icemandios on May 19, 2020 18:02:51 GMT
How a California biotech briefly tripled its value by hyping a Covid-19 ‘cure’
Jason Mast
Associate Editor
Last week, a California biotech called Sorrento Therapeutics emailed reporters about the discovery of an “exceptionally potent antibody” for Covid-19. Then the CEO, Henry Ji, got a Fox News reporter on the phone and told him that there was a cure, that the crisis would be over.
“We want to emphasize there is a cure. There is a solution that works 100 percent,” Ji said. “If we have the neutralizing antibody in your body, you don’t need the social distancing. You can open up a society without fear.”
After publication, Sorrento’s stock shot up. Its price per share went from $2.62 at market close on Thursday to $9.96 at market open on Monday, before sliding down to a $5.23 as of Tuesday morning, a valuation that nonetheless had the company worth a tick over $1 billion. There was just one problem: The company had not put their drug in a mouse, let alone a patient.
Michael Mina
“It was way overblown, it was an overblown headline,” Michael Mina, a Harvard infectious disease expert, said on a media call Monday. “Saying that something neutralizes a virus in vitro is very, very different from suggesting that it’s something that can be useful in humans.”
While Sorrento’s stock shot up, some biotech investors were aghast. In the company’s claims about a cure, they saw a routine practice during oubreaks: Small biotechs, who have no approved drugs and thus live and die by their ability to keep investor money flowing, putting out press releases that raise hopes and shares around treatments that rarely, if ever, arrive.
Sorrento — which did not respond to multiple requests for an interview — had already developed a kind of notoriety within the industry for the practice, said Brad Loncar, an independent biotech investor. “It’s known for having that reputation,” he told Endpoints News.
Ethicists were particularly concerned about Ji’s interview with Fox News, in which he not only said there was a cure but appeared to imply that, because of it, people can avoid the social distancing practices that experts say have helped stem the virus’s spread.
Alison Bateman-House
“It’s a complete abrogation of your responsibility as a biotech company,” Alison Bateman-House, a bioethicist at NYU Lagone Health, told Endpoints. “It’s one thing to be carried away with the enthusiasm about the potential of your product – it’s inappropriate, but it’s potentially understandable in the context of a really serious pandemic. It’s another thing to say that now I’m going to weigh in on public health and social policy matters as a result of this drug, which doesn’t even exist yet.”
“There are a lot of red flags here, the biggest one is the use of the word ‘cure,’” Lisa Kearns, who also researches bioethics at NYU Langone Health, told Endpoints. “They’re really hitting all the notes of what people want to hear.”
In an email, Harvard bioethicist Aaron Kesselheim criticized both the company and the credulous coverage, which failed to explain that the experiment was in very early stages. “The news article is very unfortunate,” he said. “Words like “cure” have a lot of emotional power, especially in times like this when thousands of people are dying each day from a disease that currently doesn’t have a cure.”
So what exactly had Sorrento done? The company developed a potent monoclonal antibody that binds to and neutralizes SARS-CoV-2, the virus that causes Covid-19, in Petri dishes. It’s a crucial early step in developing a form of treatment that has been effective against Ebola and RSV, among other viruses, and that researchers think has significant potential to treat this one, Mina said. “If I were putting my money somewhere, I’d put it on monoclonals,” he said.
That first step, though, has already been done numerous times by biotechs and labs around the world. Regeneron, one of three major companies expected to bring antibodies into the clinic this summer, said they developed hundreds in March, and on Sunday, researchers in China published their discovery of 14 different potent antibodies in the journal Cell.
Next comes animal testing and then studies in humans that test both the safety of the drug and its ability to fight or prevent Covid-19. And Sorrento plans to eventually go into the clinical stage with a well-known partner: Mount Sinai Hospital.
Still, experts caution against using the word “cure” for the first Petri dish stage because the vast majority of drugs will fail during these subsequent steps. The Fox News story failed to mention that the drug had not yet been put in animals, and although the press release said the experiments were in vitro — the scientific term for Petri dish studies — critics countered that much of the public wouldn’t know what that means.
“That’s a really big word – what the heck does ‘in vitro’ mean?” Loncar said, noting that he ended up explaining the details to his mom, who asked him about after seeing the story.
“To me, it seemed deliberately targeted to people who don’t know much about the field — that is, those who don’t realize that there are many reports of neutralizing antibodies so far with in vitro activity, which is all that they showed,” Lowe said in an email to Endpoints. “The breathless tone of the release was grating, and the only reason I can see for it was to boost their stock price and perhaps sell shares. Mission accomplished, it looks like.”
Loncar said the boost to Sorrento’s stock was bad, but the impact in potentially misleading a worried public was worse. Bateman-House, though, argued the two issues intersected: Money that flows into Sorrento means money that doesn’t go elsewhere.
“This is not a consequence-less thing,” Bateman-House said. “It’ll work or it won’t work, it’ll have hype or it won’t have hype, and that has consequences for the futures that might be more promising.”
Jason Mast
Associate Editor
Last week, a California biotech called Sorrento Therapeutics emailed reporters about the discovery of an “exceptionally potent antibody” for Covid-19. Then the CEO, Henry Ji, got a Fox News reporter on the phone and told him that there was a cure, that the crisis would be over.
“We want to emphasize there is a cure. There is a solution that works 100 percent,” Ji said. “If we have the neutralizing antibody in your body, you don’t need the social distancing. You can open up a society without fear.”
After publication, Sorrento’s stock shot up. Its price per share went from $2.62 at market close on Thursday to $9.96 at market open on Monday, before sliding down to a $5.23 as of Tuesday morning, a valuation that nonetheless had the company worth a tick over $1 billion. There was just one problem: The company had not put their drug in a mouse, let alone a patient.
Michael Mina
“It was way overblown, it was an overblown headline,” Michael Mina, a Harvard infectious disease expert, said on a media call Monday. “Saying that something neutralizes a virus in vitro is very, very different from suggesting that it’s something that can be useful in humans.”
While Sorrento’s stock shot up, some biotech investors were aghast. In the company’s claims about a cure, they saw a routine practice during oubreaks: Small biotechs, who have no approved drugs and thus live and die by their ability to keep investor money flowing, putting out press releases that raise hopes and shares around treatments that rarely, if ever, arrive.
Sorrento — which did not respond to multiple requests for an interview — had already developed a kind of notoriety within the industry for the practice, said Brad Loncar, an independent biotech investor. “It’s known for having that reputation,” he told Endpoints News.
Ethicists were particularly concerned about Ji’s interview with Fox News, in which he not only said there was a cure but appeared to imply that, because of it, people can avoid the social distancing practices that experts say have helped stem the virus’s spread.
Alison Bateman-House
“It’s a complete abrogation of your responsibility as a biotech company,” Alison Bateman-House, a bioethicist at NYU Lagone Health, told Endpoints. “It’s one thing to be carried away with the enthusiasm about the potential of your product – it’s inappropriate, but it’s potentially understandable in the context of a really serious pandemic. It’s another thing to say that now I’m going to weigh in on public health and social policy matters as a result of this drug, which doesn’t even exist yet.”
“There are a lot of red flags here, the biggest one is the use of the word ‘cure,’” Lisa Kearns, who also researches bioethics at NYU Langone Health, told Endpoints. “They’re really hitting all the notes of what people want to hear.”
In an email, Harvard bioethicist Aaron Kesselheim criticized both the company and the credulous coverage, which failed to explain that the experiment was in very early stages. “The news article is very unfortunate,” he said. “Words like “cure” have a lot of emotional power, especially in times like this when thousands of people are dying each day from a disease that currently doesn’t have a cure.”
So what exactly had Sorrento done? The company developed a potent monoclonal antibody that binds to and neutralizes SARS-CoV-2, the virus that causes Covid-19, in Petri dishes. It’s a crucial early step in developing a form of treatment that has been effective against Ebola and RSV, among other viruses, and that researchers think has significant potential to treat this one, Mina said. “If I were putting my money somewhere, I’d put it on monoclonals,” he said.
That first step, though, has already been done numerous times by biotechs and labs around the world. Regeneron, one of three major companies expected to bring antibodies into the clinic this summer, said they developed hundreds in March, and on Sunday, researchers in China published their discovery of 14 different potent antibodies in the journal Cell.
Next comes animal testing and then studies in humans that test both the safety of the drug and its ability to fight or prevent Covid-19. And Sorrento plans to eventually go into the clinical stage with a well-known partner: Mount Sinai Hospital.
Still, experts caution against using the word “cure” for the first Petri dish stage because the vast majority of drugs will fail during these subsequent steps. The Fox News story failed to mention that the drug had not yet been put in animals, and although the press release said the experiments were in vitro — the scientific term for Petri dish studies — critics countered that much of the public wouldn’t know what that means.
“That’s a really big word – what the heck does ‘in vitro’ mean?” Loncar said, noting that he ended up explaining the details to his mom, who asked him about after seeing the story.
“To me, it seemed deliberately targeted to people who don’t know much about the field — that is, those who don’t realize that there are many reports of neutralizing antibodies so far with in vitro activity, which is all that they showed,” Lowe said in an email to Endpoints. “The breathless tone of the release was grating, and the only reason I can see for it was to boost their stock price and perhaps sell shares. Mission accomplished, it looks like.”
Loncar said the boost to Sorrento’s stock was bad, but the impact in potentially misleading a worried public was worse. Bateman-House, though, argued the two issues intersected: Money that flows into Sorrento means money that doesn’t go elsewhere.
“This is not a consequence-less thing,” Bateman-House said. “It’ll work or it won’t work, it’ll have hype or it won’t have hype, and that has consequences for the futures that might be more promising.”