NJ Biotech Companies Face Headwinds

BioNJ’s 15th Annual BioPartnering Conference featured 93 presenting companies.

Against the backdrop of uncertainty stemming from federal government changes as well as the investor sector and other sources, nearly 600 attendees — including 100 investors —learned about life sciences industry trends and heard from 93 presenting biotechnology companies at BioNJ’s 15th Annual BioPartnering Conference held yesterday at the Liberty Science Center in Jersey City.

Macroeconomic Trends

The Trump administration and its associated policies were front-and-center at the conference, with BioNJ President and CEO Debbie Hart telling the audience that Trump’s Most Favored Nation Policy (MFN) executive order focused on reducing pharmaceutical drug prices “wasn’t as bad as it could have possibly been; not as bad as perhaps we expected. We’re going to hold hope that we’re going to get through this and we’re going to get through this in one piece … Hopefully, today will be a path forward for that.”

The MFN policy proposes that the US pay pharmaceutical prices equal to “the nation that pays the lowest price anywhere in the world,” although the executive order may only affect select drugs covered by Medicare and that are administered to patients in a healthcare setting.

Hart said in a previously released statement: “BioNJ is deeply concerned about the Most Favored Nation Executive Order issued by President Trump. This concept, which intends to link prescription drug prices that are paid in the US, to those in other nations, is a deeply flawed attempt to enable the government to control prices, which economic assessments have shown will not only decimate innovation in the life sciences — but will also essentially mimic policymaking in nations that generate a fraction of the diversity of treatments and cures that American companies have been able to bring to patients.”

Additional Changes

Thomas Morrisroe, vice president of J.P. Morgan Equity Capital Markets Group, told the BioNJ audience that Dr. Vinay Prasad’s appointment to oversee vaccines at the Food and Drug Administration (FDA) created an “immediate knee-jerk reaction rooted in uncertainty on the path forward.” Prasad, a hematologist-oncologist, had been accused by some people of spreading false information about COVID vaccines.

Biotechnology Sphere

Morrisroe meanwhile highlighted that “market tone and [the] biotech landscape is skewed broadly negative at the moment,” later adding that “we’d like to get to a more stable investor sector, including … stabilizing volatility and clarity around Trump policies and administrative actions.”

He added, “This would create an improved funding environment with revitalized demand around catalyst events and follow through on the robust IPO pipeline that we have in the healthcare landscape. On that point, it will be interesting to see what windows open up for biotech IPOs this year, and we will likely have to wait until at least late summer to see an IPO in this space. That is an uncommon amount of time in the biotech IPO world.”

Morrisroe is nonetheless optimistic that investors and strategic companies will start to selectively add to their portfolios. He is advising clients to think carefully about “spend,” prepare for maximum optionality, and focus on having thought leaders help manage the challenging markets.

The Economy

Broader macroeconomic trends are at play and appear at least partly positive. Morrisroe said many people believe recently revised tariff rates may reignite US-China trade, and, separately, he said that J.P. Morgan now forecasts a 40% likelihood of a recession compared to a 65% chance earlier this month. He described tariffs as the “newcomer to the macro environment in 2025 [that] have had an outsized impact so far.”

He stressed that while interest rates and inflation have been areas of focus for years and remain important elements, he also said, “Liberation Day (the April 2 announcement of tariffs) and the surrounding tariff deliberations have cause significant volatility swings in equity indices that we’ve not seen since the height of the COVID impact.”

Artificial Intelligence

BioNJ’s conference also focused on AI. In a panel discussion titled “Leveraging AI to Accelerate Life Science and MedTech Innovation,” Corey Sanders, senior vice president of strategy at CoreWeave, said that during his decades at Microsoft, he had “the distinct honor of working at Microsoft and actually be one of the owners of the relationship with OpenAI in the early days, as some of the original large language model research was coming out.”

Of today’s cutting-edge AI, he cited examples: “… [Using] AI [can] develop dry labs to be able to quickly take new drug research and drop down the [number] of molecules that are being tested in the wet lab. [It can be used for] manufacturing improvements, quality improvements, [and] be able to detect quality issues. [AI] can be used with things as simple as direct-to-patient solutions that are made possible by reducing the amount of required work behind [them] and creating better experiences.”

Shlomi Madar, Ph.D., CEO of SpotitEarly, explained that his company is also using AI. He said, “We combine the amazing sense of smell of dogs with AI to detect cancer early.”

The dogs are trained to sit down when they detect cancer via both the millions of receptors in their nostrils as well as the olfactory bulb in their brains’ frontal lobe.

Madar said, “Our problem was actually not the dogs, but rather the humans, because you have to use humans to interpret the dog’s behavior. There are some subtleties in the dog’s behavior, even physiological measures that you just cannot see.”

Presentations

BioNJ attendees were ready to do business. Among the 93 presenting companies was Australis Pharmaceuticals, whose AUS_001 oncology lead compound has demonstrated encouraging in-vitroi and in-vivo data in efficacy and toxicity studies across multiple tumor lines.

Echoing the goals and sentiments of myriad conference-goers, CEO Michele Korfin told the audience, “This conference is outstanding, so I always attend. [I’m] representing Australis today and looking for two key objectives: Introduce ourselves to potential partners to help us advance our clinical development program and also enhance our balance sheet. We’re looking to raise $10 million by the end of this year. [We] do have funds to get us through the first in human study. What we’re looking to do is then accelerate our clinical development plan beyond that.”

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