Event – J&J hopes canagliflozin flourishes where Forxiga failed

Analysis

Johnson & Johnson’s diabetes pill canagliflozin faces an FDA advisory panel next week in a bid to become the first drug in its class to reach the US market. While consensus forecasts put near-blockbuster numbers on the glucose-lowering candidate in 2018, there is reason to expect the expert panellists to give it a tough enough hearing to result in regulatory delay.

Even if the wealth of data submitted does not turn up the cancer signal that scuppered Bristol-Myers Squibb and AstraZeneca’s Forxiga in the US a year ago, there is still the heightened risk of urinary tract infections that is the result of its mechanism of action, increased excretion of glucose. Even if FDA experts believe that to be an acceptable risk, physicians might not want to manage patient infections, potentially limiting canagliflozin’s commercial potential.

Company Johnson & Johnson
Product Canagliflozin
Market cap $196bn
Product NPV $1.63bn
% of market cap 1%
Event type FDA advisory committee
Date January 10, 2013

Another arrow for the quiver

Canagliflozin is a sodium-glucose co-transporter 2 (SGLT2) inhibitor, and works by blocking the reabsorption of glucose back into the body by the kidneys and increasing the level of glucose in the urine. Higher rates of glucose reabsorption contribute to elevated blood levels in diabetics.

It would join such oral antidiabetic drugs as metformin, sulfonylurea and the dipeptidyl peptidase IV (DPP-IV) inhibitor class in the arsenal of physicians trying to keep diabetics from advancing to full-time insulin treatment. In its pivotal programme, it demonstrated superiority to the DPP-IV Januvia when used in combination with metformin and sulfonylurea, among numerous trials enrolling 10,000 patients.

Approval would make canagliflozin, with the proposed brand name Invokana, the first in its class to access the world’s biggest drug market, though the second to reach Europe. Forxiga, known generically as dapagliflozin, got European Union approval in November.

EvaluatePharma’s consensus forecasts sales of $901m in 2018, putting canagliflozin solidly on a path to blockbuster numbers. It will be Johnson & Johnson’s 11th-biggest drug in 2018; moreover, it is its second-biggest drug in development after the phase III hepatitis C drug simeprevir. Thus approval will add a solid contributor to J&J’s lineup.

Caution

However, Forxiga’s difficulties in the US should engender some caution about canafliglozin’s approvability. Long-term follow-up for the Astra/Bristol-Myers pill revealed an imbalance in breast and bladder cancers, and as the data readout came just weeks before its adcom it all but guaranteed a complete response letter (Dapa doubts validate Bristol-Myers decision to share the risk, July 20, 2011).

No cancer risk for canagliflozin has so far emerged, although it will take the FDA briefing documents' release early next week to confirm that the regulator’s staff agrees with investigators’ analyses of adverse events.

Beyond the urinary tract infections – not surprising as the increased sugar in the urine attracts microorganisms – analysts from UBS note an elevation of low-density lipoprotein, the so-called “bad cholesterol” that contributes to cardiovascular disease. Given that the diabetic population already prone to heart disease, such a signal will be closely scrutinised in a pill to be used long-term.

In a September 11, 2012 note, analysts from Credit Suisse strike a cautious tone about canagliflozin, noting the potential for a previously unseen safety signal to emerge in the briefing documents.

Moreover, Credit Suisse is not quite convinced it will be a commercial hit. Many diabetics are managed by primary care doctors, who will prefer other oral drugs over a pill that carries the risk of urinary tract infections and will entail further patient management. Thus, investors might be overestimating sales; canagliflozin might only be able to grab 1% of market share, compared with 1.5% in the current consensus.

But first it must sail what could be rough regulatory waters. Given the Forxiga precedent, there should be some jitters in J&J’s regulatory affairs staff; whether they are justified will be clearer early next week.

To contact the writer of this story email Jonathan Gardner in London at JonathanG@epvantage.com or follow  @JonEPVantage on Twitter

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