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Thursday, Apr 18, 2024

Amgen: $150M to Scale Up Minority Businesses

Earlier this month, Thousand Oaks pharma giant Amgen Inc. had the opportunity to both give and receive. 

On the giving end, Amgen announced on Feb. 3 that it has invested $150 million in a new fund to scale up minority-owned businesses.  

On the receiving end, it was announced on Feb. 2 that the U.S. Food and Drug Administration had approved a self-administration option of Amgen and AstraZeneca’s asthma therapy drug Tezspire. 

Amgen’s $150 million investment is in a just-closed $1.45 billion fund known as Project Black, operated by New York investment firm Ariel Investments. That fund “seeks to invest in middle-market companies that may not currently be minority-owned, as well as existing Black- or Latino/a-owned businesses, with $100 million to $1 billion in revenue,” according to the announcement from Ariel. 

“Under the fund’s ownership, these companies are expected to be transformed into certified minority business enterprises of scale that can serve as Tier 1 suppliers to the Fortune 500,” the announcement continued. Tier 1 businesses are prime suppliers of goods and services to companies.  

“Our $150 million investment in Project Black reflects our commitment to minority-owned businesses,” Robert Bradway, Amgen’s chief executive, said of the company’s commitment. “These businesses have all too often lacked access to the capital they need to flourish. Project Black is an important step toward levelling the playing field.” 

Amgen is one of 13 major companies that have agreed to invest between $100 million and $200 million Project Black. The companies span a wide array of industries, including retail giants Walmart Inc. and Lowe’s Cos. Inc., pharma rival Merck & Co. Inc. and NextEra Energy Inc. 

“We chose to partner with large institutions that are seeking to drive widespread corporate vendor diversity,” said Leslie Brun, co-founder and chief executive of Ariel’s alternative investments arm. “Our goal is to help close the racial wealth gap by creating minority-owned businesses of scale through access to both capital and customers.” 

With the $1.45 billion in commitments and a seven-year window for its investments, Project Black plans to pursue acquisitions of as many as 10 middle-market companies with $100 million to $1 billion in revenue. It will focus predominately on high-margin sectors that fulfill corporate procurement needs, such as health care, industrial, media/marketing, manufacturing/packaging, technology, and transportation/logistics. 

After the fund acquires its target companies, its investment team will partner with the companies to pursue growth strategies. 

 

FDA approval of Tezpire option  

As for the asthma drug Tezpire, the FDA’s recent approval of a self-administration option represents a major step in easing access to the drug, which until now has been available only through subcutaneous injections administered by health care professionals, much like vaccines. 

The drug is used to treat severe asthma that is resistant to other treatments. Injections are given every four weeks to blunt the impact of – or prevent entirely – asthma attacks. 

Tezpire was developed and brought through clinical trials under a 2012 collaboration agreement between Amgen and Cambridge, United Kingdom-based AstraZeneca. Under a 2020 amended agreement between the two pharma giants, both companies will continue to share costs and profits equally after payment by AstraZeneca of a single-digit inventor royalty to Amgen. AstraZeneca continues to lead development and Amgen continues to lead manufacturing. Terms of that amended agreement authorize Amgen and AstraZeneca to jointly commercialize Tezpire in North America, with Amgen recording product sales in the U.S. and AstraZeneca recording its share of U.S. profits as collaboration revenue. 

The FDA approval announced earlier this month is for delivery of the drug through a pre-filled pen that enables patients and caregivers to self-administer the medicine at home or in clinic. It is somewhat similar to an EpiPen device used to deliver epinephrine to people suffering allergy attacks. The Tezpire pen is fitted with a safety guard and viewing window and has audible clicks at the start and end of the injection to guide patients. 

During clinical trials, 92% of health care providers, patients and caregivers were able to successfully administer Tezpire both in the clinic and at home. 

“Severe asthma continues to be a very complex condition to manage, so we welcome the Tezpire pre-filled pen as an option that will empower patients and health care providers with increased choice,” Kenneth Mendez, chief executive of the Asthma and Allergy Foundation of America, said in the approval announcement released by AstraZeneca. “We believe self-administration alternatives can play an important role in patients’ lives and address unmet needs for those living with severe asthma.” 

Hannah Madans Welk
Hannah Madans Welk
Hannah Madans Welk is a managing editor at the Los Angeles Business Journal and the San Fernando Valley Business Journal. She previously covered real estate for the Los Angeles Business Journal. She has done work with publications including The Orange County Register, The Real Deal and doityourself.com.

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