Biotech Values

[genisi]

FDA nod to new MS drug spells trouble for Teva

http://www.haaretz.com/print-edition/business/fda-nod-to-new-ms-drug-spells-trouble-for-teva-1.295789

Novartis' Gilenia threat [not so fast] to sales of Copaxone.

By TheMarker and Reuters

Novartis AG's experimental multiple sclerosis pill moved one step closer to winning U.S. approval on Thursday when a Food and Drug Administration advisory panel backed the drug to help reduce and delay patients' symptoms.

The FDA's outside advisers said that despite some concerns over potential risks the drug worked well enough to be considered an initial treatment option for all MS patients. They said that more data is still needed, especially on side effects.

The FDA will weigh the panel's recommendation as it makes its approval decision, expected by September. If approved, Novartis' Gilenia could be the first pill to treat U.S. patients, whose options now are limited to more invasive, injectable medications.

Novartis told the panel its pill is easier to take than injectable medicines already on the market and avoids the flu-like symptoms seen with some rivals.

Israel's Teva Pharmaceutical Industries is among the firms that currently market injectable drugs for the treatment of the degenerative disease. Not all patients can tolerate them, Novartis said.

Teva's revenues from Copaxone were $796 million in the first quarter of 2010, a 28% rise from the same quarter of 2009. U.S. sales rose 19% from the previous quarter, to $513 million. Total Copaxone sales were $2.8 billion in 2009, representing about 20% of Teva's total revenues and an estimated 25%-30% of its net profits for the year.

The main pharmaceutical "victim" of a successful launch of Gilenia, however, stands to be not Copaxone but rather interferon-based MS treatments such as Biogen Idec's Avonex as well as that company's Tysabri, delivered via intravenous infusion and considered a controversial option with its own side-effect issues.

In a study of patients who switched from Avonex to Gilenia, the relapse rate in year two was reduced by 31 percent and the number of new or newly growing brain lesions was reduced by 67 percent on the new drug.

Earlier last week Germany's Merck resubmitted its bid to the FDA in the hope of selling its MS pill, cladribine, after a delay last year. Other future rivals include experimental pills such as Teva's laquinimod, Biogen's BG-12 and Sanofi-Aventis SA's teriflunomide.

"Neurologists clearly want an oral option for their MS patients," Joshua Schimmer of Leerink Swann Research said in a research note.

Wall Street has predicted that Gilenia could be a potential blockbuster product for the Swiss drugmaker.

Forecasts, on average, point to sales of $987 million by 2014, according to Thomson Reuters data, although some analysts expect even bigger sales. Analysts at the Jefferies brokerage expect the drug to bring in $1.6 billion by 2014, while Nomura forecasts $2.1 billion in sales by 2014.

FDA staff had expressed some concern about side effects that arose in Novartis' clinical trials, including heart problems, fluid in the eye and a decrease in lung function. But FDA advisers said benefits of the novel treatment outweighed the risks as long as more studies are done.

They also expressed concern about the potential for complications if the drug were used in a wider population after approval, noting that diabetics and other high-risk patients were excluded from Novartis' trials.

Robert Temple, head of the FDA division that reviews neurological drugs, said the FDA would order additional data on such patients. "The excluded groups will have to be studied in some way. There's no question about that," he told the panel.

Novartis said it plans to continue to study the drug's safety with a 5,000-patient, five-year study, although panelists said the company's planned study was not enough.

The panelists' backing comes with other caveats, including a recommendation that patients be monitored for heart problems after they take their first dose. They also said routine exams would not be enough to monitor for other side effects, such as vision problems or declining lung function.

They also said the FDA should require Novartis to study a lower dose than the 0.5 milligram pill the company wants approved to see whether it would be as effective but possibly less risky.

Shares of Novartis closed up 1.7% on the New York Stock Exchange on Friday, to $48.25, after climbing 3.3% Thursday.