06 February 2022 |

Biogen Sells Out and Buys In

By workweek


Biogen Sells Out and Buys In

Biogen is selling its equity stake in a joint venture with Samsung Biologics and buying into Roche’s cancer drug mosunetuzumab. These business moves will likely bring in billions of dollars of revenue over the years, helping the company bounce back from the financial struggles of its Alzheimer’s drug Aduhlem.

The Deets
Biogen formed a joint venture with Samsung Biologics over a decade ago to create Samsung Bioepis, which makes biosimilars for autoimmune diseases. Biosimilars are near-copies of their original drug. Here’s the central part of the deal:

  • Biogen will sell its equity stake for a return of $2.3B (link).

Additionally, Biogen will exercise its option with Roche to develop and commercialize its cancer drug mosunetuzumab, an antibody that inhibits cell surface proteins CD20 and CD3 (link). If approved, the drug has the potential to be the first CD20/CD3 antibody drug to treat B-cell non-Hodgkin’s lymphoma. Here are the main parts of the deal:

  • Biogen will pay a $30 million one-time option fee to Genetech (part of the Roche group).
  • Biogen will cover a portion of the costs incurred to develop mosunetuzumab during 2021.
  • Biogen will have joint decision-making rights for development and commercialization while Genetech will lead strategy and implementation.
  • Biogen will share around 30% of operating profits and losses of mosunetuzumab in the U.S. and is eligible to receive low single-digit royalties on sales outside the U.S.

A Tough 2021 for Biogen
Biogen’s stock dropped 14.5% in 2021 compared to the S&P, which grew around 20% (link). The company had high expectations for Aduhlem to bring in revenue, but following drama and controversy over the drug’s shaky efficacy, its revenue totaled just $3 million for the year (compared to its multiple sclerosis drug Tysabri, which raked in $512.7M in Q4 alone). If you want a quick timeline of the drama, check out the third article of our recent newsletter (link). Note that the FTC and SEC may now be investigating Aduhlem (link).

The Future
Biogen lowered its expected earnings for 2022 since CMS announced it would restrict coverage of Aduhelm only to patients in clinical trials (link). Aduhelm continues to be a big eyesore for the company. Do they shelve the drug? At this point, I think they should still fight for it, but if the efficacy evidence isn’t there (which it doesn’t seem like it is), the drug’s broader approval is out of Biogen’s control.

Lastly, with the influx of cash Biogen will receive, its acquisition capacity will increase to around $10B. In addition, there are rumors that Biogen is building up its cash to acquire another biotech company like Aurinia Pharmaceuticals, which seems reasonable given the above-mentioned business moves and financial performance (link).


Withings Wants to Make It About You

Fitness wearable company Withings acquired health and wellness platform 8fit (link). The acquisition will help Withings compete with strong competitors like Garmin and WHOOP to create personalized data and health plans.

It’s All About You, Baby

Withings plans to invest $30M over the next three years to develop personalized health plans that “combine sophisticated data with actionable insights” (link). 8fit’s platform will help Withings with these personalized health plans through its personalized nutrition, physical activity and mindfulness programs. The company’s app has thousands of customizable workouts from HIIT training to meditation. Combine 8fit’s products with Withings wearable tech and insights, and you got yourself your own personal health coach.

8fit isn’t Withings first acquisition as of late. They recently acquired device maker Impeto Medical, which makes a device that can detect early signs of neuropathy by analyzing sweat gland conductance in palms and soles (link). Impeto Medical’s tech will integrate with Withings high-tech weight scales to catch peripheral neuropathy before a patient with diabetes realizes it. Talk about personal care!

Smart wearables are expected to increase at a CAGR of 20% until 2026 (link). Similarly, the smart scale market is expected to have a CAGR of 9% over the next six years (link). These markets will only get bigger as the health tech gets better.

My Take
I’m a huge fan of wearable tech and accessories. I own a Garmin and WHOOP (Withings’ competitors), and even have a small group chat with my WHOOP friends where we discuss our data daily—it’s a lot of fun (shoutout Brett, Aaron, Jonny and Jack). I think this personalized data mixed with community is the future.


Medicare Advantage Becomes More Lucrative

The Centers for Medicare and Medicaid Services plans to increase revenue for Medicare Part C (Medicare Advantage, MA) and Part D plans, and incorporate new measurements to account for the social determinants of health in 2023 (link). The $412B MA market is about to get bigger.

By the Numbers

The expected average change in revenue will increase around 7.98% in 2023 compared to just 4.08% in 2022. MA insurers may expect significant returns if their enrollment grows, which it likely will. Enrollment in MA grew 8.8% this year, totaling 28.5M beneficiaries and making up 44% of all Medicare enrollees. UnitedHealth Group and Anthem saw 11% and 30% growth in MA enrollment, respectively. The Congressional Budget Office predicts the number of MA enrollees will surpass that of Original Medicare by 2030. As I said in a previous newsletter:

The writing is on the wall: The MA market is hot and is growing fast .

Health Equity 
CMS plans to add more health equity measures to the star rating system for MA plans:

  • Stratify MA and Part D star ratings by social risk factors to help identify opportunities for health plans to improve.
  • Health equity index, which would consolidate health equity performance measures (area deprivation index) and put them into one score (link).
  • Social determinants of health screenings to account for ways in which health plans are screening their beneficiaries for social determinants of health.

Where Do We Go from Here?
The Biden Administration said it wants to lay the hammer on MA plans and their booming market by holding them to higher standards (link). This seems reasonable to ensure beneficiaries are receiving the highest-value care possible. Will it slow down the fast-growing market? Likely not. I think it’s growing too fast—especially with an aging population—for new regulations to slow it down. What do you think?


  • Legislators are trying to put a cap on the high rates staffing firms can pay travel nurses. Demand for travel nurses drastically increased during the pandemic.
  • Lesser-known are international nurse staffing agencies that hire foreign medical workers for less than their American counterparts. Now, former employees are fighting back against firms like Health Carousel LLC and accusing them of trafficking.
  • Medable, which recently achieved a $2.1B valuation, is acquiring Omhu A/S and its digital dermatology technologies.
  • Mark Cuban’s drug company isn’t the only digital pharmacy on a roll lately. Alto, whose just raised $200M in Series E funding. The company has raised $550M total.
  • Humana is doubling down on Medicare Advantage with a $1B investment and cutting some other ventures like its hospice arm.


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  • 📚What I’m Reading: Steve Jobs by Walter Isaacson. It’s taking me months to read this book, but learning about Jobs is so fascinating.
  • 💭Quote I’m Pondering: “Simplicity is the ultimate sophistication… it comes from conquering the complexities, not ignoring them.”
  • 🎙Podcast I’m listening to: It turns out Fitt Insider—whose newsletter I mentioned last month—has an awesome podcast, too. The podcast recently featured the co-founder of my favorite cycling training platform TrainerRoad. Give it a listen and check out their other podcasts and newsletters!*