Biogen Takes Hit on FDA OK of Novartis Oral MS Drug
By Donna Young
Washington Editor WASHINGTON – The winds of change blew against Biogen Idec Inc. Wednesday, with shares sailing downward 5.8 percent, after the FDA approved the first oral disease-modifying agent for multiple sclerosis, Gilenya (fingolimod), from competitor Novartis AG.
Shares of Cambridge, Mass.-based Biogen (NASDAQ:BIIB), closed at $54.86, a loss of $3.37.
Analysts have long-predicted Gilenya's approval, which came as no surprise after being unanimously backed in June by the FDA's Peripheral and Central Nervous System Drugs Advisory Committee, would erode market share for Biogen's infused drug Tysabri (natalizumab), given its link to progressive multifocal leukoencephalopathy (PML). (See BioWorld Today, June 14, 2010.)
The risk evaluation and mitigation strategy (REMS) plan for Gilenya, which was approved as a first-line therapy, also was not as harsh as analysts had expected – no black-box warning – giving the drug another leg up over Tysabri, whose own REMS includes a complex restricted distribution program.
And with a much more convenient oral drug available for U.S. patients, the injectable ABCR drugs – Biogen's Avonex (interferon beta-1a), Bayer AG's Betaseron (interferon beta-1b), Teva Pharmaceutical Industries Ltd.'s Copaxone (glatiramer acetate) and EMD Serono Inc.'s Rebif (interferon beta-1a) – also are expected to take a hit.
Deutsche Bank Equity Research analyst Robyn Karnauskas noted that Avonex has been losing market share for several years – dropping between 2 percent and 3 percent per year for the past five years, with Capaxone accounting for a majority of that loss. She pointed to Teva's marketing team as driving that uptake.
Karnauskas predicted that ABCRs would lose about 15 percent of patients to Gilenya next year, with about 40 percent switching to Novartis' drug by 2014.
But Karnauskas predicted that Tysabri would be the drug most negatively impacted, with U.S. sales declining by as much as 40 percent for that drug alone by 2015.
While Gilenya's approval as a first-line indication and better-than-expected safety labeling put near-term pressure on Biogen's shares, Jefferies & Co. analyst Thomas Wei said he expected the initial use of Novartis' drug to be in the second- or third-line settings.
"We believe Tysabri sales will be resilient," Wei said, insisting that Biogen's multiple sclerosis franchise would "yield attractive cash flow generation."
He noted that although Gilenya's REMS was milder than expected, there are, nonetheless, several risk monitoring requirements for the drug, such as a directive for a baseline electrocardiogram before the first dose, with patients observed for six hours after that initial dose, due to the potential for a decrease in heart rate.
Patients also are required to have an ophthalmological evaluation performed at baseline before starting Gilenya and at three to four months after the treatment is started.
The labeling also calls for spirometry and diffusion lung capacity testing when needed.
In addition, prescribers should ensure a patient's liver enzymes have been tested before initiating Gilenya therapy.
"We continue to believe physicians will be initially cautious in approaching the use of Gilenya because of the myriad of safety issues and limited treatment experience," Wei said.
While Gilenya's approval is a positive milestone for patients, the drug's long-term safety profile has yet to be established, argued Frederick Munschauer, vice president of U.S. medical affairs at Biogen.
"Biogen is very committed to new therapies for MS, so we welcome options," he told BioWorld Today. "But we are also committed as a company to finding the best drug for patients," Munschauer added.
"Matching the right drug to the right patient is the name of the game and the clinical management of MS," he explained.
Munschauer noted that Gilenya is the first in a new class of medications, known as sphingosine 1-phosphate receptors.
"We really need to monitor them closely for a myriad of known side effects that are indicated in the label for Gilenya, but also keeping a wary eye for things that you didn't expect," he said.
While monitoring any new drugs is essential, Munschauer pointed out that "it is particularly important for drugs with systemic effects on the immune system [such] as Gilenya."
But Fred Lublin, a professor of neurology at Mount Sinai School of Medicine, contended that although Gilenya's safety should be monitored to identify any unknown adverse effects, the known effects are "manageable."
And while finally having an oral disease-modifying therapy available for patients is "exciting in and of itself," the "excellent" efficacy results of the drug cannot be disputed, Lublin told BioWorld Today.
Gilenya showed superior efficacy by reducing relapses by 52 percent at one year vs. injectable interferon beta-1a. Basel, Switzerland-based Novartis also reported that two-year, placebo-controlled data demonstrated that Gilenya significantly reduced the risk of disability progression.
The firm's data showed that Gilenya significantly reduced relapses, the risk of disability progression and the number of MRI-detected brain lesions.
Novartis noted that Gilenya's approval was based on the "largest clinical trial program ever submitted to date to the FDA for a new MS drug."
Trevor Mundel, global head of development at Novartis, said his company also is pursuing regulatory approval in Europe and the rest of the world.
Meanwhile, Biogen continues to develop its own oral MS drug, BG-12 (dimethyl fumarate), a small-molecule immune modulator, which is in Phase III testing, with data expected by mid-2011, Munschauer said.
"It not only has a proposed mechanism of action that modifies the immune system, but it may be neuroprotective," he said.
Munschauer added that BG-12 has a more selective action than Gilenya.
And because BG-12 is a derivative of fumarate, which is a compound that has been used in Europe for the treatment of psoriasis, "we also have a relative safety experience," Munschauer said.
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