Replies to post #193223 on Biotech Values

[DewDiligence]

Some analysts (and NVS) expect Entresto to reach peak annual sales of $5B.

According to today’s WSJ (http://www.wsj.com/articles/novartis-heart-failure-drug-approved-by-fda-1436304389 ), Leerink thinks peak sales will reach $6B.

The US list price is $12.50 per day.

[DewDiligence]

NVS’ Entresto might increase risk of AMD and AD, say journal authors:

http://www.medpagetoday.com/Cardiology/CardioBrief/55107?xid=nl_mpt_DHE_2015-12-10&eun=g655567d0r

The concerns, raised in a Journal of the American Medical Association viewpoint article…focus on the possibility that a key mechanism of the drug, neprilysin inhibition, may have troubling repercussions in the central nervous system and the eye. Entresto is a combination of the novel neprilysin inhibitor sacubitril and the older, well-established angiotensin receptor antagonist valsartan [a/k/a Diovan].

NVS expects Entresto to have peak worldwide sales of at least $5B (some analysts are even higher), so these safety concerns, although just conjecture at this point, are no small matter.

[DewDiligence]

NVS’ Entresto is off to a slow start:

http://www.wsj.com/articles/novartis-heart-failure-pill-falls-short-of-sales-expectations-1458155650

Entresto had $21 million in sales in the six months following its launch, a fraction of the $126 million expected by industry analysts. It also missed the company’s undisclosed internal forecasts, said David Epstein, head of pharmaceuticals at Novartis. This has created a big headache for Novartis, which is leaning heavily on Entresto and another new drug, Cosentyx, to blunt the impact of its blockbuster cancer drug Gleevec losing patent protection in February.

…Entresto’s sluggish performance is puzzling, given thatcardiologists agree the drug marks a rare breakthrough in medicine for heart-failure…

Milton Packer, one of the cardiologists who co-led the Entresto trial, said that while the drug had stoked “enormous excitement” among cardiologists, they needed time to debate and digest the results before starting to use it in large numbers. He noted that the introduction of beta blockers in the 1990s “changed the entire landscape of the treatment of heart failure, but it took about five to 10 years.”

…Another reason for the lackluster launch: Until recently, many patients’ health plans didn’t cover the drug, priced at $12.50 a day before discounts. Around two-thirds of eligible patients are covered by Medicare health plans, which can take up to six months to start reimbursing for new drugs.

Some analysts—and NVS itself—recently thought Entresto would attain peak annual sales of $5B+. I’m not sure if they still do.