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Drugmaker Merck & Co. will spin off $6.5 billion in assets, including women’s-health products and cholesterol treatments that have lost patent protection, that are equal to 15% of its prescription drug sales. The move to shed the products will allow Merck to focus on faster-growing cancer drugs, vaccines and animal-health items, Merck Chief Executive Ken Frazier said. (Hopkins, 2/5)

Merck joins rivals including Pfizer and GlaxoSmithKline, which have made similar moves. Carving off 14% of Merck’s sales into what it is still calling “NewCo” should allow the core company to grow faster, attracting investors who want to bet on the rising sales of the company’s cancer drug, Keytruda, which by itself generates $11 billion in annual sales and grew at a 55% clip in 2018, as well as its businesses in vaccines and hospital drugs. (Herper, 2/5)

A U.S. appeals panel on Wednesday denied a patent challenge against Biogen’s multiple sclerosis drug Tecfidera, putting off the early launch of a generic version by Mylan and sending shares of Biogen surging. Mylan, the generic drug maker, had filed an inter partes review seeking to overturn the last remaining patent on Tecfidera, Biogen’s most important multiple sclerosis drug. That patent was not set to expire until 2028. (Feuerstein, 2/5)

The French drug giant Sanofi on Thursday reported positive results in a study of its new pill to treat multiple sclerosis. The drug, which Sanofi licensed from South San Francisco-based Principia Biopharma in 2017, “significantly reduced disease activity associated with multiple sclerosis as measured by magnetic resonance imaging,” the company said in a statement. Full data on the drug, called SAR442168, are not being made available yet, but will be presented at a later medical meeting. (Herper, 2/6)

In a setback to Gilead Sciences (GILD), a federal panel rejected its bid to invalidate a pair of patents owned by the U.S. government for using the Truvada pill to prevent HIV, a drug that has sparked controversy due to its cost and the extent to which taxpayer dollars funded crucial research. The Patent Trial and Appeals Board ruled that Gilead failed to demonstrate it was likely to win its argument for overturning the patents held by the Centers for Disease Control and Prevention, which helped fund academic work into HIV prevention that later formed the basis for the best-selling medicine that is also known as PrEP (here is one ruling and here is the other). (Silverman, 2/5)

On Wednesday, South San Francisco-based CODA announced its acquisition of Attenua, another venture-backed, early-stage biotech company. In exchange for an undisclosed amount, CODA got three of Attenua’s drug candidates. Attenua had hoped they would work as therapies for chronic cough. (Sheridan, 2/5)

Sanofi SA swung to a loss in the fourth quarter as the recall of heartburn drug Zantac over cancer concerns offset strong sales of newer treatments. The French health-care giant on Thursday posted a net loss of €10 million ($11 million) for the last three months of 2019, compared with a profit of €254 million a year earlier. That was partly driven by a €169 million write-down related to Zantac, which it voluntarily recalled in the U.S. and Canada amid concerns it—and other products containing the same active ingredient—could contain small amounts of probable human carcinogen NDMA. (Roland, 2/6)

Jeffrey Bluestone, the prominent immunologist, has decided to leave his position as president of the Parker Institute for Cancer Immunotherapy, the research effort funded by billionaire Sean Parker, and strike out on his own as CEO of a new company, Sonoma Biotherapeutics. The departure, which occurred in December, means Bluestone is resigning from an organization that is trying to develop a new model for advancing cancer research and heading to a biotech startup that’s trying to do it in a more familiar way. Sonoma is trying to develop therapies that harness the immune system by treating not cancer but diseases of the immune system like rheumatoid arthritis, multiple sclerosis, and inflammatory bowel disease. (Herper, 2/6)

Patients in Pennsylvania facing the most serious stage of cancer will no longer be forced to try cheaper drugs before their insurance covers other, more expensive treatments. The state House on Tuesday gave final approval to a bill that would abolish the heavily criticized “fail first” approach for stage IV cancer, which requires patients to show no improvement with cheaper, insurance-approved drugs before moving on to more innovative approaches. (Fernandez, 2/5)

In 2007, controversy flared over the safety of a widely used diabetes pill called Avandia after an analysis found increased heart attack risks. The results led to congressional hearings about regulatory oversight, the Food and Drug Administration required more demanding studies for similar drugs, and GlaxoSmithKline (GSK) was accused of allegedly manipulating data in a concurrent safety trial of its own. On a broader scale, the episode, which initially prompted the FDA to tighten restrictions for the pill, raised questions about access to raw trial data. Now a new analysis has largely confirmed the findings. And while there are some nuances that clarify the extent of heart risks found at the time, the effort underscores the value in having such clinical trial data for identifying important safety signals. (Silverman, 2/5)

Two years ago, Roche spent $1.9 billion to buy a startup, Flatiron Health, which uses data from patients’ electronic health records to better study cancer drugs. Now, many of the same investors are backing a new firm that will aim to do similar research in eye disease and neurology. The twist: The new company, Verana Health, is obtaining its data by partnering with medical societies, including the American Academy of Ophthalmology, the largest organization of ophthalmologists, and the American Academy of Neurology. (Herper, 2/5)