Replies to post #246606 on Zeev's Turnips Patch-No Politics (ZEEV)

[Zeev Hed]

Any drug that targets a population of a million people (US only) is a buster, particularly, since these drugs may have a price tag of $10,000 or so per year, even at 1/10 of that price and a low initial penetration (just 10%) it should be $100 MM annually, with Europe and the rest of the world, who knows. The question is how is the earnings partition between ELN and BIIB on that one, I have not the slightest. Interestingly, this drug may find many other applications in other diseases involving the immune system (autoimmune failures, like rheumatoid arthritis, MS etc), so a potential billion bucks market is not impossible, and that is a big drug.

[greg s]

jeff,

re: Crohn's Disease, addition to Zeev's comments

Crohn's and Ulcerative Colitis are closely related and are grouped under the classification of IBD (Inflammatory Bowel Disease). In fact, researchers are not sure if they are actually separate diseases since both are linked to a misfire of the autoimmune system.

The number of people suffering from this disease is huge, like Zeev said. Also, it is a disease that strikes the relatively young (mostly 30-50 yrs. old), so these people have to live with the disease a long time (if they are fortunate).

The most typical treatment today is comprised of mesalamine (close relative to asprin), infliximab, corticosteroids (horrible side effects), and later, methotrexate (once steroids stop working, also horrible side effects). It seems nothing works for very long with most of the patients.

If this drug proves effective and is used in the clinical population at large, it would be a huge boon for both the investor and the patient. Also, keep in mind that there is a lot of work underway with microbial antigens. There are two other drugs in the pipeline (sorry, I don't know the producers) that i know of:

Rifaximin (gastrointestinal site-specific antibiotic)

CDP-870 (inhibits TNF-alpha, known to cause inflammation)

Not to mention uses in other autoimmune diseases mentioned by Zeev, although this is a bit of a long shot at this point in time.

My mom suffers with UC, so I have spent a lot of time trying to educate myself.

[James T Kirk]

The size of the market was discussed by others. It is potentially very large. However, is this drug a major breakthrough? Probably not. I own BIIB so I just look at this as a bonus. I'm really in it for the MS results. BIIB is also in Phase III with Rituxin for RA. Hoping for good news there as well. Since you are in ELN, I would focus on the huge potential in MS and just consider anything from Crohns a bonus. They've begun Phase II with Antegren for RA with more diseases to follow at some point. I'm really expecting Antegren to be huge. Hope I'm not disappointed.

I chose BIIB over ELN for a large investment simply because I prefer the bigger safer company with more potential add-ons.

[James T Kirk]

Check this out on Crohn's. Maybe there is some potential here afterall. $700 million in sales for Remicade and Antegren side effects should be better. Hope Merrill knows what they're talking about.

Pipeline Brings Hope To Crohn's Patients
Monday April 26, 10:19 am ET
By Gloria Lau

In the pharmaceutical industry, sometimes what's bad for patients is good for drug makers.

An example is Crohn's disease. Sufferers don't have many options when it comes to treatments. Only one biologic drug - Remicade, made by Johnson & Johnson's Centocor unit - has Food and Drug Administration approval to fight the disease.

But since Crohn's afflicts more than a million people in the U.S. and Europe, there's plenty of growth opportunity for drug makers .

"There's clearly a market for further agents," said Ravi Mehrotra, an analyst with SG Securities.

Crohn's is a chronic inflammation of the intestine that mostly afflicts patients in their teens, 20s and 30s. It has no known cure.

"You're talking about disabling pain that keeps you up at night, prevents you from eating, causes vomiting, diarrhea, fever and infection - where you can't function at all," said Dr. Seymour Katz, clinical professor of medicine at the New York University School of Medicine.

Commonly used drugs include those that fight inflammation, steroids or medicines that broadly suppress the immune system.

But 60% of patients with moderate-to-severe Crohn's - or about 150,000 people - don't benefit from these drugs. Some opt for surgery, but afterward the disease can recur in the remaining portions of the intestine.

For these patients, Remicade is an option. Katz says it puts a third of his patients into remission. It also helps two-thirds see improvement.

The downside: At around $2,500 per infusion, it's not cheap.

"You start with three infusions at week zero, two and six," Katz said. "Then you continue it every eight weeks, and you're committed to an indefinite maintenance program."

Though Remicade costs a Crohn's patient and his insurer up to $16,000 a year, Julie McHugh - Centocor's senior vice president of global strategic marketing - defends the price. She says it's cheaper than checking into a hospital for several days - which a small percentage of Crohn's patients regularly do.

Budding Competition

Remicade certainly has a solid customer base. More than 70,000 Crohn's patients have used it, according to a recent Merrill Lynch report. The drug brought in more than $700 million in global Crohn's sales last year, up from $440 million in 2002.

Merrill Lynch analysts Erica Whittaker and Peter Welford expect the market to grow to more than $2 billion by 2010 as other biologics challenge Remicade's monopoly.

Three biologics are in late-stage clinical studies. Whittaker and Welford see all three drugs reaching the market by early 2007.

They expect Celltech Group's CDP 870 to win FDA approval first and be launched by mid-2006. It should be followed six months later by Abbott Laboratories' Humira. Schering's Leukine - which is already sold to help restore cancer patients' immune systems after chemotherapy - is expected to launch in early 2007.

Humira and Leukine are designed for patients to self-inject via syringe at home. Remicade requires patients to visit a doctor's office for an IV infusion that can take a couple of hours.

Another Remicade drawback is that it's a part-mouse monoclonal antibody. The drug is 25% mouse and 75% human. The immune systems of some patients see the mouse parts as foreign and produce antibodies to attack it. This clears Remicade from the body faster and renders it ineffective.

Merrill's analysts say clinical studies show 7% to 19% of those treated with Remicade developed such antibodies.

Centocor's McHugh argues that these side effects happen only when patients stop for long periods between Remicade infusions, which Centocor doesn't recommend. Besides, she says, the other biologics are also being studied for indefinite maintenance use.

Still, Celltech spokesman Richard Bungay claims his firm's drug, CDP 870, is better because it's 98% human and just 2% mouse.

"We expect a much lower level of patients developing antibodies against our drug," he said.

Abbott's Humira is 100% human, so patients might have even lower risks of developing antibodies.

Sharing The Wealth

Merrill's analysts contend that while Remicade's dominance will continue, it'll control less market share.

They see Celltech's drug gaining 16% of the global market by 2010. Abbott's Humira is expected to grab 26% because patients can self-inject the drug and because Abbott has a big, proven marketing team. Schering's Leukine is seen gaining 13% of the market, while Remicade is expected to retain 45%.

No matter who wins the Crohn's war, each of the players seeks FDA approval to sell the same drugs for other disorders.

Remicade, Humira, Leukine, CDP 870 and other medicines are being studied to see if they'll ease other autoimmune diseases such as psoriasis, rheumatoid arthritis, psoriatic arthritis and ankylosing spondylitis.

Abbott expects that next year, Humira sales will exceed $1.2 billion from rheumatoid arthritis alone.

"Each drug company will successively file for review of a new disease within a few months of the last disease," said analyst Jan Wald of AG Edwards.

http://biz.yahoo.com/ibd/040426/health_1.html