Event – Medicines Company hopes to reverse fortune with Orbactiv

After a run of bad news The Medicines Company could do with some good fortune, and is hoping that this will be served up to weary investors in the form of approval for its antibiotic Orbactiv on August 6.

So far the omens are good. The FDA has not convened an advisory panel, the project has qualified infectious disease product status (QIDP) and priority review, and the world is desperate for new anti-infectives. That said, Orbactiv will be the third antibiotic on the market to target acute bacterial skin and skin structure infection (ABSSSI) in as many months, raising important questions about its commercial prospects.

Product Orbactiv (oritavancin diphosphate)
Company  The Medicines Company
Market cap  $1.68bn
Product NPV  $432m
% of Mkt Cap 26%
Event  PDUFA date
Date  August 6, 2014

Like the other newer entrants Orbactiv does not represent a revolutionary advance on older treatments, managing to show only modest non-inferiority against the current standards of care in clinical trials.

What it does have on its side is a better side-effect profile than Durata Therapeutics’ recently launched Dalvance, and more importantly a dosing advantage. Although Orbactiv is infused, it is a single infusion, unlike Dalvance, which involves two infusions a week apart, raising concerns that patients might not return for the second dose, accelerating potential resistance (FDA antibiotics programme yields first approval in Durata’s Dalvance, May 27, 2014).

However, Cubist Pharmaceuticals' Sivextro, the other antibiotic newcomer, is also single-dosed, and can either be taken orally or intravenously, making it stiffer competition. According to EvaluatePharma data, however, analysts have declared Orbactiv the winner in the race between the three products, with its sales forecast to hit $470m in 2020, compared with $309m for Sivextro and $361m for Dalvance.  

Making the difference

But all of the new antibiotics are set to struggle unless they can differentiate themselves once Pfizer’s Zyvox comes off patent in 2015. The Medicines Company believes that the convenience of Orbactiv's single dose should play well with doctors, and has previously stated to analysts that it believes IV anti-infective drugs to be under-priced, adding that the market could grow through targeting fewer patients with higher-priced drugs.

This strategy could prove tricky to implement, and bigger, more experienced drugmakers have found it hard to make money-spinners out of antibiotics given their short duration of use and historically low pricing. This has left most of the recent development of anti-infectives in the hands of smaller groups like The Medicines Company and Cubist rather than big pharma.

Success, though, is vital for The Medicines Company. The group has this year suffered a series of setbacks that have left some wondering whether it has long-term viability. Most recently the FDA issued a complete response letter for its blood thinner Cangrelor, causing shares to fall 16% (The Medicines Company reels from harsh Cangrelor verdict, February 13, 2014).

It is also in the middle of a legal battle to head off generic competition for its lead product, Angiomax. And while an appeal has been lodged many do not believe that The Medicines Company will prevail and next year will see the entry of copycat versions.  

All of this has left Orbactiv as the biggest growth driver at the company over the next five years, and with little else in the pipeline if this does not live up to expectations any joy around its approval will be short lived.

To contact the writer of this story email Lisa Urquhart in London at lisau@epvantage.com or follow @LisaEPVantage on Twitter

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