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Jan 09, 2012
 |  BioCentury  |  Finance

PDUFAs produce yawns

Buysiders see HCV big again in 2012, along with cancer, autoimmune therapies

There are more than twice as many PDUFA dates this year than last - at least 40 vs. 17 - but only a handful of potential approvals are drumming up interest among buysiders. Investors are focusing on areas such as HCV, which is almost unanimously seen as maintaining its momentum into 2012, while oral autoimmune therapies and selected cancer products are also attracting attention.

According to buysiders, the large number of compounds under review at FDAdoes not equate to a large amount of excitement. Kurt von Emster of venBio described the PDUFA dates for 2012 as having "marginal impact." OrbiMed's Sven Borho echoed this, saying it is "not the greatest year" for approvals.

A few potential approvals are attracting attention. Eric Roberts of Caxton Advantage and Deka Investment's Kai Bruening like the chances of ridaforolimus from Ariad Pharmaceuticals Inc. and partner Merck & Co. Inc. to treat metastatic soft tissue or bone sarcomas. The compound has a June 5 PDUFA date.

Buysiders Joep Muijrers of LSP and International Biotechnology Trust's David Pinniger also like Ironwood Pharmaceuticals Inc.'s linaclotide, which is under review to treat chronic constipation and irritable bowel syndrome with constipation (IBS-C). The PDUFA date is expected in June. Ironwood will co-commercialize linaclotide in the U.S. with Forest Laboratories Inc.

Roberts also named Ironwood as fitting the profile of a potential takeout target - having a Phase III or marketed product while retaining a significant part of the economics of the asset. However, such a deal won't be straightforward, as the company created two classes of shares in its 2010 IPO (see BioCentury, Feb. 1, 2010).

Amarin Corp. plc is another mid-cap with an upcoming FDA action that Muijrers and Roberts tip as a potential takeout target, given the good Phase III data for its AMR101 in hypertriglyceridemia. The compound has a July 26 PDUFA date (see BioCentury, Dec. 6, 2010).

HCV big again

Buysiders expect HCV to continue to be the hot area in 2012, following the 2011 launches of protease inhibitors Incivek telaprevir from Vertex Pharmaceuticals Inc. and Victrelis boceprevir from Merck, as well as Gilead Sciences Inc.'s proposed acquisition of Pharmasset Inc. for about $11 billion.

This year could see the fast rise of second-generation products. In particular, Harald Schwarz of Medical Strategy named TMC435, a once-daily protease inhibitor from Medivir AB and Johnson & Johnson. "Most participants in the market expect that if the second-generation products are approved, Incivek will lose market share at once," he said.

Data are expected this year from three Phase III trials of TMC435 in HCV genotype 1.

Investors also are looking for data in 2012 to elucidate whether protease inhibitors will remain a key component in oral HCV cocktails. These include Phase II trials of TMC435 plus Pharmasset's PSI-7977; Vertex's VX-222, a non-nucleoside HCV NS5B polymerase inhibitor plus Incivek; and Bristol-Myers Squibb Co.'s daclatasvir, an HCV NS5A protein inhibitor, plus PSI-7977.

Beyond the data, investors are expecting further consolidation in the space. Almost all cited three HCV plays as likely to enter partnerships or be acquired in 2012: Idenix Pharmaceuticals Inc., Achillion Pharmaceuticals Inc. and Inhibitex Inc.

As BB Biotech's Daniel Koller noted: "I think in HCV we are far from over. It's still more a question of will it be partnerships or straightforward acquisitions."

Late on Saturday, Inhibitex announced it has opted for the latter, having reached a definitive agreement to be acquired by Bristol-Myers for $26 per share in cash, or $2.5 billion. Shareholders owning 17% of the biotech have already agreed to tender their shares.

Inhibitex's lead program is nucleotide polymerase inhibitor INX-189, which is in Phase II testing. The other two HCV picks have multiple unpartnered HCV assets, with Idenix being the most advanced. Its nucleotide polymerase inhibitor IDX184 is in Phase IIb testing. Achillion's lead is ACH-1625, an HCV NS3 protease inhibitor in Phase II (see BioCentury, Oct. 31, 2011).

Before the Inhibitex announcement, Pinniger said his money was on Achillion to be the next HCV takeout.

Autoimmune goes oral

Investors are also eyeing the oral autoimmune space for 2012, in particular oral therapies in multiple sclerosis (MS) and Janus kinase (JAK) inhibitors in rheumatoid arthritis (RA).

Roberts said "autoimmune is certainly the biggest story for 2012."

With impressive data last year, Pinniger said Biogen Idec Inc.'s BG-12 is already "transitioning to a commercial positioning story, and I think everyone is now beginning to have to think about the implications of success for BG-12 on the rest of Biogen's business."

Biogen plans to submit an NDA for BG-12 in 1H12.

Muijrers will be looking at whether Novartis AG's Gilenya fingolimod can pick up market share before BG-12 enters the market. The sphingosine 1-phosphate (S1P) receptor agonist had 3Q11 sales of $153 million, up from $4 million in 3Q10. The drug was approved in the U.S. and Russia in September 2010.

In RA, buysiders such as Schwarz, Muijrers and Miller Tabak's Les Funtleyder said they are looking at how quickly the market will accept oral JAK inhibitors. Pfizer Inc.'s tofacitinib is leading the way with a PDUFA date in August. It is also under review in the EU.

The next most advanced JAK inhibitors for RA are in Phase II development and include GLPG0634 from Galapagos N.V., LY3009104 from Incyte Corp. and partner Eli Lilly and Co., and VX-509 from Vertex.

Finally, Koller is also looking forward to data for apremilast, Celgene Corp.'s oral phosphodiesterase-4 (PDE-4) inhibitor. The company expects to have Phase III results in psoriasis and psoriatic arthritis in mid-2012 and Phase IIb data in RA in 1H12.

The question is will apremilast "be the BG-12 for Celgene or not?" he said. "That's one of the biggies we are going to prepare for in terms of what the potential outcomes could mean and how the Street will view that."

More in cancer

While JAK inhibitors are starting to make waves in RA, they've already made a splash in myelofibrosis with the approval of Incyte's Jakafi ruxolitinib. Five investors polled by BioCentury named Incyte as a pick for 2012, based on their expectations for a good launch.

The excitement around Jakafi also triggered von Emster and Pinniger to name YM BioSciences Inc. as one of their picks. The company's CYT387, a JAK-1 and JAK-2 inhibitor, is expected to start Phase III testing for myelofibrosis in mid-2012.

Borho and Pinniger also like Pharmacyclics Inc. in 2012. The company's lead product is PCI-32765, a Bruton's tyrosine kinase (Btk) inhibitor partnered with J&J. The partners plan to start Phase III testing for chronic lymphocytic leukemia (CLL) in 1H12.

The success of J&J's Zytiga abiraterone, coupled with good data last year for Alpharadin radium-223 from Algeta ASA and Bayer AG and MDV3100 from Medivation Inc. and Astellas Pharma Inc. have buysiders including Muijrers, Borho and Schwarz expecting prostate cancer to remain interesting through 2012.

Algeta and Bayer expect to submit an NDA for Alpharadin by mid-2012. Medivation and Astellas plan a pre-NDA meeting with FDA in early 2012, with regulatory timelines to be provided after the meeting.

Although it wasn't picked by buysiders, the space also includes Xgeva denosumab from Amgen Inc. An sBLA to treat men with castration-resistant prostate cancer (CRPC) at risk of developing bone metastases will be reviewed by FDA's Oncologic Drugs Advisory Committee on Feb. 8. The PDUFA date is April 26.

Andrew Bogan of Bogan Associates said he is excited about antibody-drug conjugate (ADC) companies, with other buysiders naming two of these companies - Seattle Genetics Inc. and ImmunoGen Inc. - as picks for 2012.

This year, ImmunoGen and partner Genentech Inc. are expecting data from the Phase III EMILIA trial of T-DM1 trastuzumab emtansine in second-line metastatic breast cancer, with worldwide regulatory submissions expected by year end.

Schwarz named ImmunoGen, along with Medivation, as potential takeouts by their partners.

Seattle Genetics is being watched following its recent launch of lymphoma drug Adcetris brentuximab. Tom Brakel of Federated Investors said the launch has gone better than expected, with 3Q11 sales of $10 million, well above the Street's consensus estimate of $2.1 million.

Selena Chaisson of Bailard picked Endocyte Inc. as an ADC-like concept, citing. its targeted ovarian cancer therapy. Koller, who also likes the company, noted Endocyte's platform is like ADCs, but for small molecules.

Endocyte is expecting to submit two MAAs in 1Q12: one for EC145, a combination of a folate vitamin analog with a microtubule destabilizing anticancer agent for advanced ovarian cancer, and one for EC20, an imaging agent to detect the presence of folate receptor to select patients for folate-targeted therapy.

Borho thinks carfilzomib from Onyx Pharmaceuticals Inc. could be interesting, although he noted it could be "tricky to get approved," as the NDA is based on Phase II data. The selective proteasome inhibitor is under FDA review to treat relapsed and refractory multiple myeloma (MM) with a July 27 PDUFA date.

Split on obesity

Vivus Inc.'s Qnexa, which has a Feb. 22 review by the Endocrinologic and Metabolic Drugs Advisory Committee meeting and an April 17 PDUFA date, is a binary pick. Investors either said the outcome is very important, or something not to be touched with a 10-foot pole.

Borho is one who is picking Vivus and said if Qnexa is approved it could be the most interesting story of the year.

Roberts is also putting a bet on Vivus for 2012. He said a new obesity agent could be "the most exciting development for the pharma industry since statins."

Others buysiders were not keen on any obesity companies, given FDA's high safety hurdles.

Big caps

Among the big biotechs, multiple European buysiders picked Actelion Ltd. for 2012. The company plans to announce data in 1H12 from the Phase III SERAPHIN trial of macitentan in pulmonary arterial hypertension (PAH). Koller said the data are very important, since the biotech has positioned the data as a binary event for the stock.

With Actelion's blockbuster PAH drug Tracleer bosentan beginning to go off patent in 2015, Bruening said the company needs macitentan to work, "or else the company probably gets sold."

Koller said one of his picks is Vertex because of its cystic fibrosis pipeline. The company's Kalydeco ivacaftor has an April 18 PDUFA date.

Koller also is looking forward to hemophilia data from Biogen Idec and Swedish Orphan Biovitrum AB. The partners are expecting a pair of Phase III data readouts in 2H12 for FIXFc, a long-acting Factor IX replacement for hemophilia B, and rFVIIIFc, a long-acting...

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