SHEPHERD RECORDS CAREER BEST FINISH AT MEMPHIS

Peter Shepherd - Race Recap
Memphis Motorsports Park/Memphis, Tenn./June 30, 2007
Started 15th / Finished 15th
SHEPHERD RECORDS CAREER BEST FINISH AT MEMPHIS

Peter Shepherd, No. 50 Northern Tool + Equipment Ford F-150

MEMPHIS, Tenn. (June 30, 2007) - Although Saturday was a day filled with thunderstorms and nasty weather, a little bit of light shined on Peter Shepherd and the No. 50 Northern Tool + Equipment team. With a remarkably smooth race at the .75 mile Memphis Motorsports Park, Shepherd was able to run inside the top-20 for the majority of the night. Coming off a 32nd place finish, the strategy for the No. 50 team was to stay on the track and complete all of the scheduled 200 laps. With superb pit stops combined with good driving, the team soared above expectations and was able to grab the 15th position as the checkered flag flew at lap 200.
The Craftsman Truck Series made its stop at Memphis Motorsports Park on Saturday for the O'Reilly Auto Parts 200 with Brad Keselowski leading the pack to the green flag. Shepherd started in the 15th position and managed to hold on to the position until an early yellow came out at lap eight for a wreck involving the No14 and No. 23 trucks. When the race restarted, Shepherd found himself shuffling positions inside the top 20. Shepherd held onto the 19th position until the second caution of the night flew at lap 72 for debris.
Once the pit lane opened, Shepherd came to the attention of the Northern Tool + Equipment team. After reporting to crew chief Matt Puccia that he did not have much brake; the call was made to take four tires, fuel and brake adjustments. Quick work by the crew sent Shepherd back on track for the restart in the 16th position.
As the laps clicked off, Shepherd reported to the crew that his F-150 had gone to the tight side, that he was unable to get his Northern Tool + Equipment Ford to rotate through the center of the turns the way he wanted it to. Shepherd reported that his brake issues continued, and that he would need a chassis adjustment on the next stop to help correct his ill-handling issues.
Shepherd got the break he needed when the caution flag flew at lap 114 for a wreck involving the No. 00 truck. Shepherd came to pit road with the leaders to take on four tires, fuel and a slight air pressure adjustment. The crew was once again on their game, advancing Shepherd a position, lining him up in 18th for the restart.
With the adjustments made to his No. 50 Ford, Shepherd began to feel more comfortable with the handling of his Northern Tool + Equipment F-150. He patiently worked his way around a handful of trucks, working his way to the 16th position when the final caution flag of the night flew at lap 191 for a spin involving the No. 9 truck. Shepherd was able to pick up a position on the restart to bring his Northern Tool + Equipment Ford home in the 15th position.
"I'm pleased with the 15th place finish tonight," Shepherd said. "Track position was a big deal tonight and I felt that I left a little bit on the table during qualifying. Of course, this Northern Tool + Equipment team did a great job and kept me in the race all night," said Shepherd. "I was able to gain a lot of valuable experience and the team gave me the advantage tonight."
About Northern Tool + Equipment
Northern Tool + Equipment has been a supplier of high-quality tools and equipment for more than 25 years, selling products through direct mail, the Internet and at nearly 60 retail locations in 11 states. Along with a deep selection of hand, power and air tools, Northern Tool + Equipment carries a wide variety of products, including generators, pressure washers, air compressors, hydraulics, small engines, trailers, water pumps, tractors, welding equipment and much more. Northern Tool + Equipment also serves as the exclusive distributor of NorthStarTM brand equipment, which is fabricated and assembled at the company's 250,000 sq. ft. manufacturing facility. For more information, visit www.northerntool.com.

From Rory Connellan, Roush Fenway Racing

Dalton Joins Pfizer

The make over of the corporate VC world continues.

IN VIVO Blog has recently learned that Pfizer Inc. brought aboard Barbara Dalton, formerly of SR One and EuclidSR, to lead its Pfizer Strategic Investment Group. In hiring Dalton, Pfizer is sticking with the decision to be represented by professionals with experience on the front lines of venture capital investing rather than shuffling people out from the corporate side of the business.

Dalton joins Debra Yu, formerly of Delphi Ventures and Bay City Capital, who helped start the group three years ago. She replaces Ilya Oshman. She’ll report directly to Ed Harrigan, senior vice president of worldwide licensing and business development. “We are certainly pleased to have Barbara join us – she brings a great deal of experience, is very well-respected in the field, and will surely put her stamp on Pfizer’s venture investment group,” Harrigan told IN VIVO Blog in an email.

Pfizer is taking a unique approach with this venture effort. First, as we stated earlier, it’s bringing in outside people with venture investing experience and, more important, connections. To be sure, any VC or chief executive will return a phone call from Pfizer. But the program clearly benefits from having familiar faces represent in the field at conferences and other venture gathering places.

Second, from the very first day the venture group steered clear of Pfizer’s internal research and development wheelhouse—pharmaceuticals—as well as some external efforts (remember the Pfincubator and our other posts?). Instead, the group sought to invest in companies that might influence how pharmaceuticals are used, marketed or paid for.

The group has built a significant portfolio in diagnostics and, no doubt as part of this effort, the corporate side of the house has stood up and taken notice, becoming an aggressive and progressive player in diagnostics. “She brings the needed talent and personality to the job that is important as our venture activity evolves to its new place in the organization," Yu told us in an email.

Prior to moving over to EuclidSR in 2003, Dalton had been president of SR One, one of the grand daddies of corporate venture programs in the pharmaceutical world, for two years. Founded by Peter Sears in 1985, SR One first invested on behalf of Smithkline Beckman. It has survived all these years as its corporate sponsor went through mergers.

Dalton became president in 2001 when Brenda Gavin, who took over for Sears in 1999, moved on to co-found Quaker BioVentures in 2001.

Dalton left SR One in 2003 with two other principals to become full-time investors at EuclidSR, a New York venture capital firm. This group grew out of a partnership between Euclid Partners, a venture capital firm, and SR One. The firm that sought to invest in companies that benefited from the “convergence” of health care and information technology.

EuclidSR raised at least one fund in 2000, the first year of the partnership. Dalton and other SR One principals invested on behalf of both GSK and EuclidSR until their departure in 2003. It’s unclear what Dalton’s departure means for EuclidSR. She couldn’t be reached for comment.

East tops West in BBQ Battle

Here are the particulars from PPP’s latest poll. Happy 4th of July!

Favorite Summer Vacation Spot

Beach 51%
Mountains 28%

Favorite Barbeque

Eastern 47%
Western 29%

License Plate Lettering

Old Blue 32%
New Red 26%

Favorite Pro Team

Panthers 49%
Hurricanes 14%
Bobcats 10%

Do you follow NASCAR?

Yes 34%
No 66%

Favorite local fruit

Strawberries 37%
Watermelon 21%
Peaches 16%
Blueberries 13%

Vacation in NC or out-of-state

North Carolina 52%
Out-of-state 48%

Favorite College Team

UNC 33%
NC State 17%
Duke 12%
Wake Forest 7%
ECU 6%

Thank Goodness for Vaccines

Novartis’ CEO and chairman Dan Vasella is probably feeling quite pleased that he bought his $5.1 billion ticket into the vaccines arena through acquiring Chiron in 2005.

It might not have been an easy, or cheap, buy (remember Novartis had to push up its bid and there were all sorts of problems with Chiron's Liverpool manufacturing plant), but it does give Novartis options beyond regular therapeutics, as we explained more fully here.

Options which it could do with, frankly. The Swiss group has seen Cox-2 inhibitor Prexige blocked out of the US so far, caught up in the Vioxx-wake (with prospects looking bleaker following the fall of Merck’s Arcoxia in April). It’s also having to watch Merck’s Januvia run away as the first DPP-IV inhibitor available to diabetes patients, since its own Galvus received only an approvable letter in February.

Enter vaccines. Although they have already, thanks to bioterrorism and pandemic preparedness, shed their image as fusty, low-margin cousins to therapeutics, vaccines have more recently achieved full stardom since the launch of Merck/Sanofi Pasteur MSD’s cervical cancer vaccine Gardasil. Vaccines are being investigated in a growing number of therapeutic areas, including cancer, and can now command premium pricing. (Their development, as we explained here, also provides some useful lessons for today’s pharma execs.)

That’s in part why the numbers in Novartis’ deal with Austria’s Intercell, announced this morning, look rather good. The Swiss group pays €120 million ($160 million) up front, plus a further €150 million in cash to buy equity in Intercell, in exchange for exclusive rights to Intercell’s adjuvant technology, IC31, for developing influenza vaccines, and non-exclusive rights in other areas. Novartis also gets opt-in rights to any of Intercell’s un-partnered vaccine targets after Phase II (or earlier), but must allow the biotech co-development or a licensing arrangement on any products that it opts in.

It’s Roche-Genentech all over again—or sort of. It would have been much cheaper for Novartis to buy Intercell outright (in addition to the total $360 million cash upfront, this deal could cost Novartis up to $134 million in development milestones for developing IC31 in influenza, $40-80 million in upfront and milestone payments on each other IC31 license, plus up to $150 million in development milestones post-Phase II…not to mention rich double-digit royalties on each product Novartis opts in on).

But these days, the arm’s length, leave-it-alone strategy of partnering with biotech is as fashionable as vaccines themselves (granted, of course, that the Big Pharma partner isn’t forced into buying outright, as many have been recently). Think of other portfolio-based, risk-sharing deals like Novartis’ own 2003 deal with Idenix, or GlaxoSmithKline’s respiratory tie-up with Theravance: the idea being to leave the biotech (largely) to its own devices.

This is the first such deal in vaccines, though, according to the partners. And although Novartis did take a majority stake in Idenix (which was private at the time), it’s sticking with a 16%, non-controlling stake in Intercell. “If they got to 25%, they’d have to make a mandatory bid,” explains Intercell’s CFO Werner Lanthaler. But, he says, “Novartis understand how important it is to leave us our independent spirit.”

Indeed, independent Intercell has done alright so far. Since listing in 2005, the company’s share price has climbed almost 300%, and the group has partnering deals with Merck, Sanofi Pasteur, Wyeth and Kirin, among others. It has submitted its first BLA, for a Japanese Encephalitis vaccine, and has a therapeutic vaccine for Hepatitis B and a prophylactic vaccine for pseudomonas both in Phase II trials.

Novartis may soon have two more Phase II candidates, plus a novel influenza platform to back up its own Optaflu cell-culture based vaccine, approved in the EU in June. And all thanks to vaccines.

Pollster Profile: American Viewpoint

Last week we reported on a survey conducted for the NC Center for Voter Education by the polling company American Viewpoint. American Viewpoint is a national Republican polling firm located in Alexandria, VA. The company’s founder and president is Linda DiVall, a veteran of Republican campaigns and leader in developing Republican strategies for women and health care issues.

American Viewpoint’s political client list includes big names like Bush-Cheney ’04, Fred Thompson and Newt Gingrich. They have worked for numerous current and former Senators and Congressman. They have also done work for the Log Cabin Republicans and the Republican Majority for Choice.

North Carolina ties include working for former State Rep. Richard Morgan and Elizabeth Dole’s Presidential Campaign.

The non-political client list is a mixed bag of corporations and advocacy groups that span the ideological divide (for example, AARP, American Medical Association, AT&T, CBS News, NEA and Planned Parenthood).

The polling for the NC Center for Voter Education appears to have been lead by Randall Gutermuth, the Director of Political Affairs for American Viewpoint. Gutermuth has his own impressive list of Republican Senators, Governors and Congressman and corporate clients and was named a “Rising Star” by Campaigns & Elections magazine in 2005.

Which do you want first?

Hologic Inc. management presented plenty of good news last week at the Jefferies Healthcare Conference in New York.

But there's a bit of bad as well.

First, the good. CFO Glenn Muir and Jack Cummings, Chairman/CEO, laid out a very promising picture for the future of Hologic as it acquires Cytyc Inc., maker of medical devices and diagnostics for women's health.

In their view, Hologic’s digital mammography business clearly will benefit from the channels that Cytyc’s sales force already built into OB/GYN offices. But don’t take our word for it. Listen to the web cast here. The good financial stuff comes up 19 minutes into it.

The $6.2 billion price tag obviously is a big undertaking for Hologic management. In a Q&A session, Cummings only half-joked that the biggest challenge facing Hologic management is to not mess up such a well-run company as Cytyc. But another challenge will be the $2.2 billion Hologic borrowed to make the deal.

The company is keeping its eyes on interest rates. At this point, the rising rates aren't impacting the accretive qualities of the deal. But Muir says management's goal will be to "rapidly pay down that debt."

This suggests—at least to us—that the new Hologic-Cytyc will be out of the company-buying business for a while, which would be too bad. Prior to the merger, venture capitalists and the blogs that cover them saw both Cytyc and Hologic as up-and-coming companies that could be steady acquirers of venture-backed businesses as they grew from their mid-tier status.

IN VIVO Blog suggested this to Cummings after the presentation, and he disagreed. Cummings said Hologic could be in the market for smaller companies with products that would plug easily into Hologic’s increasingly impressive sales and marketing machine.

As an example, he cited the company’s recent acquisition of BioLucent Inc. The privately held company makes and sells the MammoPad, "a radiolucent foam cushion that covers the cold, hard surfaces of all commercially available mammography equipment," according to the release. (Two side notes: Tom Fogarty had a role in starting the company. BioLucen's brachytherapy business, which you can read about here, will be spun out into a separate company.)

According to Muir, BioLucent had 10% penetration of its market with each pad costing $5 and carrying 64% gross margin. Hologic sees the company initially bringing in roughly $25 million in annual revenue. Hologic paid $70 million for the company with the potential for earn outs tied to revenue.

So Hologic appears to be on a solid path toward becoming a major mover in women’s health care. That’s the good news. The bad news is the company will need time to digest the recent merger. It may still make the occasional acquisition, but any such company will need to fit neatly into the company's current business.

p.s. Muir deserves extra credit for making a lucid presentation at 8:10 in the morning. In response to a poke from Cummings, he revealed his 2 p.m. Wed. shuttle out of Boston arrived at 1:30 a.m. "Not the flight to be on." IN VIVO Blog is glad we drove down to CT and grabbed a morning MetroNorth.

While You Were Kicking the Habit ...

Not a big weekend for our particular brand of scuttlebutt, but here are a few tidbits of alliance- and health-care-oriented news that IN VIVO Blog picked up on over the weekend and in the wee hours of Monday morning ...

• You may have heard that a small and little-discussed film called "SiCKO" was released in the US ... we haven't seen it yet but will likely comment once we have. We know of at least one big fan!


• Late on Friday, Theravance said that GSK passed on its option to acquire 50% of the biotech's shares at $54.25. The option was a big part of the companies' 2004 deal that gave GSK the opportunity to cherry pick compounds from Theravance's pipeline (while simultaneously giving Theravance's shareholders a put option well north of the firm's IPO price). We wrote extensively about Theravance's strategy here.


• Novartis wades further into vaccines this morning with a broad alliance with the Austrian biotech Intercell. For €270 million in upfront equity (€150mm) and cash/option payments Novartis is securing options to more than 10 Intercell programs, from preclinical through Phase II. Novartis now owns 16.1% of Intercell.


• Finally, England's ban on smoking in public places took effect at 6am on Sunday, and we rejoiced. Now the UK-based members of our transatlantic blogging team can enjoy an ale at the pub without stinking like we've enjoyed an ale at the pub.