As a sector that generates solid but unspectacular annual growth, with its biggest-selling product yet to reach $500m and dominated by just a handful of companies providing limited disclosure, the in-vivo diagnostic imaging agent market has traditionally attracted relatively modest levels of interest compared to more valuable and dynamic therapy areas.
According to consensus forecast data from EvaluatePharma, the global diagnostic imaging market was worth $6.24bn last year and is set grow 3% annually to reach $7.93bn by 2014 (see table below). However, with three new diagnostic agents approved so far this year the sector is punching above its weight by representing 15% of the latest tally of 20 new molecular entities. With the next few weeks expected to provide a PDUFA verdict for Vasovist, an advisory committee review for Imagify and phase II results for Zemiva, December could prove a pivotal month for the valuations of smaller players such as EPIX Pharmaceuticals, Acusphere and Molecular Insight Pharmaceuticals.
Modest values and growth
In terms of sub-groups of diagnostic agents, the overall market is currently dominated by the X-ray contrast media products, such as GE Healthcare’s Visipaque and Omnipaque, a picture that remains unchanged in 2014 with group sales of $3.3bn.
However, the sector’s growth is expected to be supported by the magnetic resonance imaging (MRI) contrast media agents, such as Bayer’s Magnevist and Gadovist, growing 6% annually to $1.3bn by 2014.
|Diagnostic imaging market - sub category analysis|
|WW annual sales ($m)|
|2007||2014||CAGR (07 - 14)|
|X-Ray contrast media||2,865||3,329||2%|
|MRI contrast media||876||1,312||6%|
|Other contrast media||2,501||3,284||4%|
|Total diagnostic imaging market||6,242||7,925||3%|
Given the highly specialist nature of diagnostic agents, the sector is dominated by three European companies: GE Healthcare as the market leader following GE’s acquisition of Amersham in 2004, Bayer as a direct result of its purchase of Schering AG in 2006 and private Italian group Bracco.
|Diagnostic imaging market - top ten companies|
|WW annual sales ($m)|
|2007||2008||2009||2010||2011||2012||2013||2014||CAGR (07 - 14)|
|4||Molecular Insight Pharmaceuticals||-||-||3||29||194||461||686||922||-|
|9||Lantheus Medical Imaging||-||508||380||332||301||280||264||251||-|
Regarding individual imaging agents, Visipaque was the industry’s biggest-selling product in 2007 with revenues of $443m. This year looks like providing something of a threshold landmark for the sector with Visipaque sales expected to exceed $500m for the first time.
|Diagnostic imaging market - top five products *||WW annual sales ($m)|
|Rank||Product||Generic Name||Company||Pharmacological Class||Market status||2007||2014||CAGR (07 - 14)|
|1||Zemiva||iodofiltic acid I-123||Molecular Insight Pharmaceuticals||Radiodiagnostic agent||Phase II||-||888||n/a|
|2||Ultravist||iopromide||Bayer AG||X Ray contrast media||Marketed||322||501||6%|
|3||Visipaque||iodixanol||GE Healthcare||X Ray contrast media||Marketed||443||437||(0%)|
|4||Omnipaque||iohexol||GE Healthcare||X Ray contrast media||Marketed||416||427||0%|
|5||Magnevist||gadopentetate dimeglumine||Bayer AG||MRI contrast media||Marketed||413||417||0%|
|* excludes Bracco's imaging agents as individual product sales not disclosed by Bracco|
Crucial phase II data for Zemiva
However, one product that has attracted significant interest and valuation is Molecular Insight Pharmaceuticals’ Radiodiagnostic agent, Zemiva. With a potential launch in 2011, analysts are currently forecasting sales of $275m by 2014, potentially valuing the product at $981m, according to EvaluatePharma’s NPV Analyzer.
With Molecular Insight’s shares suffering heavy losses in the current financial turmoil, down 70% over the last three months to $2.65 which currently values the company at $66m, phase II data this month on Zemiva’s ability to detect cardiac ischemia and acute coronary syndrome are crucial and could provide a catalyst for share price recovery.
Advisory committee for Imagify
Acusphere faces a crucial FDA advisory committee review this week for Imagify, the company’s ultrasound imaging agent to test for coronary artery disease. Although analyst coverage of Acusphere is currently limited, as by far the company’s most advanced pipeline product the review of Imagify is clearly a pivotal event.
Unfortunately for investors in Acusphere the prospects for Imagify receiving a positive review do not look good following the publication of briefing documents ahead of the meeting on Wednesday which raise serious safety concerns about the product. Having staged something of a rally in recent weeks ahead of the meeting, Acusphere’s shares plummeted as much as 60% in early trade today, to $0.30 which values the company at $16m. With just $4m in cash at the end of September, shareholders will be desperate for a positive verdict; anything short of a unanimous vote in favour of Imagify may spell the beginning of the end for the company.
PDUFA for Vasovist
One of the FDA’s final acts of 2008 is expected to be a decision on Epix Pharmaceuticals and partner Bayer’s application for MRI agent Vasovist, with a PDUFA of December 31.
Although Vasovist has been approved and used in Europe since 2006, seeking FDA approval has been a long and arduous process; the product was originally filed five years ago in December 2003 and has since received two approvable letters, after which it had to appeal for further review.
Sold in-market by Bayer, Vasovist is forecast to reach sales of $179m by 2014, resulting in royalties to Epix of $58m, valuing the drug to Epix at $70m, significantly ahead of its current market capitalisation of $15m.
Although Epix has a mid-stage pipeline attracting reasonable interest and valuation, and with $35m in the bank is in a much stronger position than Acusphere, a positive decision from the FDA on Vasovist could help inject a bit of life back into Epix’s shares, which have lost 91% of their value this year to currently trade below cash at $0.35.
|EvaluatePharma Calendar of Events: selected events for diagnostic imaging products (next six months)|
|Event Type||Associations||Company||NPV ($m)||NPV as % of Mkt Cap||Event||Event Status||Start Date||End Date|
|US Product Approval (PDUFA)|
|Vasovist||EPIX Pharmaceuticals||70||480%||FDA Decision Date (PDUFA) on Vasovist as MRI Agent||Starts in 23 days||31 Dec 2008||31 Dec 2008|
|Imagify||Acusphere||-||-||FDA Decision Date (PDUFA) on Imagify for use as an Ultrasound Contrast Agent for Myocardial Perfusion Imaging||Starts in 81 days||27 Feb 2009||27 Feb 2009|
|US FDA Advisory Committee Meeting|
|Imagify||Acusphere||-||-||FDA Advisory Committee Meeting: Review of NDA for Imagify as an Ultrasound Contrast Agent for Myocardial Perfusion Imaging||Starts in 2 days||10 Dec 2008||10 Dec 2008|
|US Product Filing|
|CorVue||King Pharmaceuticals||251||11%||Expect US Filing for CorVue for Cardiac Perfusion Imaging||In-Play (75%)||01 Oct 2008||31 Dec 2008|
|EU Product Filing|
|Imagify||Nycomed||-||-||Expect EU Filing of Imagify as an Ultrasound Contrast Agent for Myocardial Perfusion Imaging||In-Play (87%)||01 Jul 2008||31 Dec 2008|
|Phase III Trial Results|
|Redectane||Wilex||48||64%||Phase III Trial Results for CA9-SCAN as an Imaging Agent for Renal Tumours||Starts in 114 days||01 Apr 2009||30 Sep 2009|
|Phase II Trial Results|
|Zemiva||Molecular Insight Pharmaceuticals||981||1428%||Phase II Trial Results for Zemiva for Detection of Cardiac Ischaemia||In-Play (54%)||11 Nov 2008||31 Dec 2008|
|Phase III Trial Initiation|
|Dotarem||Guerbet||867||203%||Phase III Trial Initiation for Dotarem in MRI investigations||In-Play (80%)||02 Sep 2008||31 Dec 2008|
|Azedra||Molecular Insight Pharmaceuticals||69||101%||Phase II/III Trial Initiation for Azedra for Pheochromocytoma||In-Play (87%)||01 Jul 2008||31 Dec 2008|