Friday Five - The pharma week in review (21 August 2020)

Is the FDA getting stricter?

Reading too much into individual decisions by the FDA to discern broader trends may be something of a fools' errand, but if the administration has gained a reputation for leniency in recent years, events this week threaten to swing the pendulum back the other way.

Late on Tuesday, Gilead Sciences announced that it had received a complete response letter (CRL) for its JAK inhibitor filgotinib as a treatment for rheumatoid arthritis. The FDA has requested additional data to determine whether the drug is linked to an increased risk of testicular toxicity, which is likely to delay potential approval until 2022 at the earliest.

Safety concerns were initially raised by early data from an animal study as far back as 2015 when Gilead in-licensed filgotinib from the Belgian biotech Galapagos - but the FDA's rejection still comes as a surprise. It also raises questions about the eagerness of Gilead to in-license an asset abandoned months earlier by AbbVie, a decision that looks increasingly savvy in hindsight.

Then on Wednesday, investors were equally shocked when BioMarin Pharmaceutical announced receipt of a CRL for its investigational haemophilia A gene therapy valoctocogene roxaparvovec, with the FDA requiring final data from an ongoing Phase III study to better characterise treatment durability; a decision that appears clearly beneficial to Roche (and the outlook for its marketed haemophilia A treatment Hemlibra) and which could potentially prove advantageous to rival gene therapy players, although this remains unclear at this point.

BioMarin accused the administration of moving the regulatory goalposts and in doing so echoed a response from Intercept Pharmaceuticals, which in June received a CRL for its potential non-alcoholic steatohepatitis (NASH) treatment obeticholic acid.

To what extent this spate of recent high-profile regulatory rejections constitutes a trend remains to be seen, though it is abundantly clear that issuance of priority review and breakthrough therapy status, or a lack of scrutiny by advisory committee meeting, are no guarantees that the FDA won't reject approval of new drug applications at the eleventh hour.

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What does this mean for Biogen?

One obvious read across is to Biogen's regulatory application for the investigational (and controversial) Alzheimer's disease treatment aducanumab, which was accepted by the FDA in July and awarded priority review status earlier this month.

What appears to be an increasingly pragmatic outlook by the US regulator ups the ante for Biogen, with an approval decision on aducanumab widely viewed as a binary event that could swing the company's share price wildly in either direction depending on the outcome. Not to mention enhancing or potentially eliminating the credibility of Biogen's management team in the process.

The outlook is balanced precariously, in part because a number of Biogen's flagship drug franchises are under threat from competition. To make matters worse, Mylan announced on Wednesday that it has launched the first generic version of Biogen's multiple sclerosis treatment Tecfidera in the US market, where the branded drug has generated sales of $3.8 billion over the past 12 months.   

The legal implications are complicated and Tecfidera will likely hold onto a portion of the market until multiple generics launch, note analysts at Bernstein, though they warn that Biogen's brand is damaged and the company faces a higher hurdle to switch patients to its newer agent Vumerity. Regarding the aducanumab outlook, headwinds for Tecfidera serve to enhance any downside should the FDA reject approval, they warn.

See – ViewPoints: Biogen now performing aducanumab high-wire act without a net

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J&J acquires Momenta

A decline in M&A activity brought about by the COVID-19 pandemic means that Johnson & Johnson's proposed acquisition of Momenta Pharmaceuticals – at a cost of $6.5 billion – represents the largest deal to date in the pharma sector this year. It also provides further evidence of how competitive the anti-FcRn space has become, whilst validating Momenta's transition from a company that was previously focused on the development of complex generics and biosimilars.

The deal is driven by Johnson & Johnson's push to expand its presence in the market for rare disease treatments and is focused on Momenta's lead pipeline asset nipocalimab (also known as M281), which has recently completed a Phase II trial for the generalised myasthenia gravis (gMG), with a Phase III study expected to start early next year.

Momenta management has broader plans for nipocalimab, in both rare diseases and more prevalent conditions. A Phase II trial is ongoing in the rare setting of severe, early onset haemolytic disease of the foetus and new-borns, where management notes that it is the only company pursuing FcRn inhibition in foetomaternal disorders. The candidate is also in a Phase II/III study in haemolytic anaemia, where Momenta's schedule for top-line results in 2022 makes it the most advanced FcRn inhibitor in the indication, albeit with enrolment of that study now suspended on account of COVID-19.

More on why Johnson & Johnson acquired Momenta here.  

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Sanofi doubles down on its MS hopeful

Elsewhere, Sanofi will pay $3.7 billion to acquire Principia Biopharma, in the process gaining full access to the BTK inhibitor SAR442168. This drug is in late-stage testing for multiple sclerosis and is one of the most advanced and highly touted assets in Sanofi's pipeline.

The move suggests that Sanofi is confident in its assertion that SAR442168 could emerge as a 'best in disease' therapy. Though acquiring Principia gives the French company access to a number of other BTK inhibitors and the biotech's proprietary drug discovery platform, it primarily eliminates the payment of double-digit percentage royalties on futures sales of SAR442168, which could amount to a potentially substantial value if the drug meets Sanofi's high expectations.

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Eli Lilly looks to take Chinese PD-1 global

Eli Lilly announced this week that it has expanded an existing agreement with the Chinese company Innovent Biologics to market the PD-1 inhibitor Tyvyt outside of China, where it was approved in 2018 for the treatment of classical Hodgkin's lymphoma.

Eli Lilly's strategy for Tyvyt includes seeking approval in the US market, potentially backed by interim Phase III data for the first-line treatment of metastatic, non-squamous non-small-cell lung cancer (NSCLC) recently presented at the IASLC World Conference on Lung Cancer.

Intriguingly, these data (from a Chinese study) indicate Tyvyt's effect on progression-free survival to be comparable to Merck & Co.'s market leading PD-1 inhibitor Keytruda in the landmark Keynote-189 study (with the caveats of cross-trial comparison recognised). Whether Eli Lilly chooses Keytruda as an active comparator in any study subsequently required for US approval remains to be seen; its primary focus for Tyvyt is presumably to establish the immunotherapy as an agent to be used in future in-house combination therapies.

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