"In clinical
trials Gilenya has been linked to a range of worrying side effects,
including skin cancer, heart problems and infections."
Swiss
drugmaker Novartis AG's race to get the first multiple sclerosis pill
to market reaches a pivotal point next week when U.S. experts vote on
whether Gilenya should be recommended for approval.
A
green light is far from assured. Although the new drug has outperformed
current injectable medicines in trials, it is associated with a range
of potentially serious side effects that could limit its use or block it
from the market altogether.
Industry
analysts at Citigroup think the safety issues on Gilenya are a "50/50
call" and the market generally is cautious, suggesting scope for
significant share price moves depending on the outcome of the June 10
advisory meeting.
Novartis
officials, however, are hopeful the experts will see a positive
risk-reward balance for the medicine, especially now that a lower dose
is being used, which has reduced the frequency of side effects.
If it is successful, Gilenya -- which Novartis licensed from Mitsubishi Tanabe Pharma Corp (4508.T)
-- could win a sizable chunk of existing multiple sclerosis (MS) drug
sales, totalling some $10 billion a year, and expand the overall market.
With
its potential to help Novartis overcome patent losses on older drugs,
the decision on Gilenya is seen by analysts as a key news event for the
group this year.
The
drug has a clear advantage in being easier to take than injectables
from Biogen Idec Inc , Bayer AG, Merck and Teva Pharmaceutical
Industries Ltd , as well as not causing the flu-like symptoms seen with
some of these products.
But
in clinical trials Gilenya has been linked to a range of worrying side
effects, including skin cancer, heart problems and infections. These are
expected to dominate when Food and Drug Administration (FDA) staff
publish briefing documents on the medicine ahead of the panel meeting on
June 8.
BILLIONS OF DOLLARS
Jeffrey
Holford and colleagues at brokerage Jefferies think these issues are
manageable -- especially given the lower dose of the drug now being used
-- and predict Gilenya will generate peak annual sales of $3.5 billion,
with $1.6 billion by 2014.
Nomura
forecasts an even faster ramp-up, to $2.1 billion by 2014. But the
overall view is more cautious, with consensus forecasts pointing to
sales of $987 million by 2014, according to Thomson Reuters data.
Hovering in many investors' minds is the recent history of Biogen and Elan Corp's (ELN.I)
Tysabri, an antibody drug for MS whose sales potential has been
severely cut by side effects and a restrictive surveillance programme.
Gilenya's fate will be watched closely by rivals with competing MS pills a year or two behind in development.
They include laquinimod from Teva, teriflunomide from Sanofi-Aventis SA (SASY.PA)
and BG-12 from Biogen -- as well as Mylinax from Germany's Merck, which
initially looked ahead of Gilenya in the race until a rebuff from the
FDA last November. [ID:nGEE5AT1KS]
The FDA, which doesn't always follow the advice of its advisory committees, is due to give its verdict on Gilenya by September.
In Europe, a decision is expected from regulators around the end of the year or early in 2011.
Developing
new drugs for MS is an innately tricky business because treatment
centres on dampening the body's immune system, which increases the risk
of other health problems.
MS
disrupts the way in which nerve impulses are carried to and from the
brain and can cause permanent disability. Symptoms may include numbness
or weakness in one or more limbs, partial or complete loss of vision,
tingling or pain and tremors.