Problem Statement: Execution of a biotech financing can be challenging when there are no FDA approved products for an indication. Success requires in depth analysis of total addressable market, patient dynamics, and unmet need in the absence of approved therapies to serve as precedents to anchor key commercial forecast assumptions. Cytokinetics and Royalty Pharma entered a diligence process for the funding of aficamten pivotal clinical trials for the treatment of hypertrophic cardiomyopathy (HCM).

Description: Published claims analyses have typically chosen a 1- or 2-year timeframe to estimate the diagnosed prevalence of HCM in the US and identified around 100K patients. Claims analytics using a 5-6 year time horizon, however, suggest that there are as many as 3 times as many diagnosed patients. Since it is well understood that HCM is a chronic disease with only a slightly higher mortality rate compared to a similar age cohort, it is safe to conclude that many existing HCM patients are not associated with the respective diagnosis codes and might not seek and/or receive treatment for their underlying condition in any given year. Until recently, HCM patients have been treated with either beta- or calcium-channel blockers, both of which have significant side effects and have low compliance and persistence compared to other cardiovascular diseases therapies such as heart failure. With few options in the HCM treatment pathway, patients disappear from commercially available sources of claims data. As a result of a collaborative approach to defining the addressable market, patient dynamics, and unmet need for a next-generation disease therapy, Royalty Pharma committed $150 million to fund the pivotal clinical trials of aficamten for HCM.

Lessons Learned: A highly collaborative approach to claims data analysis can be key to a successful biotech financing especially when there few external sources of epidemiology and other data to help define the commercial opportunity.

Stakeholder Perspective: Industry