Laquinimod falls behind MS pack

News

The bloom is now fully off the laquinimod rose. Teva and Active Biotech’s oral MS therapy failed to meet its primary endpoint in a second phase III trial, following disappointing efficacy findings from the first of its registration studies (AAN - Teva's early laquinimod news not a balm to investors, April 12, 2011).

With the partners facing the prospect of an additional pivotal trial or a lengthy tussle with regulators, it is looking like yet another drug may drop out of what was shaping up to be an intensely competitive oral MS space (Therapeutic focus – FTY720 a key growth driver for the MS market, December 15, 2008). Coming as it did close on the heels of Movectro’s failure, laquinimod’s tribulations appear to clear the path for candidates from Biogen Idec and Sanofi, and other earlier stage products starting to show promise (Movectro’s future murky after unsurprising FDA rejection, March 2, 2011).

Imbalance

Teva reported that laquinimod failed to significantly reduce the annualised relapse rate among patients with relapsing/remitting MS when compared to placebo in the two year Bravo trial in 1,300 patients.

The Israeli company spun the trial’s failure on the primary endpoint by noting a difference between patients in the laquinimod arm and placebo arm on MRI characteristics. When adjusted for the differences, part of the trial protocol, the study found significant improvements in the laquinimod arm, reducing the annualised relapse rate by 21.3%, disability progression as measured on the expanded disability status scale by 33.5%, and brain volume loss by 27.5%.

Failure on the primary endpoint will not reflect well on the pill, however. Moreover, even after adjustment for the MRI readings, the 21% reduction in annualised relapse rate still falls short of the 25-40% that is necessary to compete with injectable drugs.

Observers now believe the best hope for laquinimod is for regulators to order a third trial to clarify these findings, a process that would add more than two years to the development and push launch to 2014 or later. It could also find a place as a monotherapy in mild patients or as an add on to interferon or Copaxone, based on current data.

Analysts from UBS erased their forecast of $100m in sales by 2015, suggesting that consensus forecasts will soon be falling. EvaluatePharma consensus currently sits at $594m in 2016, with $135m in alliance revenue being paid to licensor Active Biotech. Shares for both groups fell yesterday, with Active diving 54% to SKr36.60 and Teva’s US-listed shares sliding 6% to $43.76. The damage to the Swedish company continued today, with shares falling another 5% to SKr34.70.

Double disappointment

It is doubly a disappointment for Teva, which markets sector-leading Copaxone but which is facing patent expiry in 2014. While current forecasts show that Copaxone will just stay on top of the space with $2.92bn in sales in 2016, it is clear the drug will be eclipsed soon after by Novartis’ Gilenya, which is forecast to sell $2.57bn in 2016 and has a patent expiry in 2019.

Laquinimod could have helped Teva defend its franchinse in the biggest branded space it competes in, but that hope has now faded.

In addition, as a once-a-day therapy, it was thought to match up well against Gilenya, compared to the twice daily or more for Biogen Idec’s BG-12.

Jostling for the oral MS crown now will be BG-12; Sanofi’s teriflunomide, which has a once-daily dosing advantage; and Actelion’s once-daily ponesimod, which today reported positive phase IIb data in reducing the number of new inflammatory brain lesions. The Swiss company said it will advance the compound into phase III.

Meanwhile, analysts from ISI Group forecast that without laquinimod to worry about BG-12’s market share could reach 23%, rather than 18% if the Teva pill had made it to market.

Teva executives said they plan to file laquinimod for approval, but the expected outcome from that regulatory manoeuvre is a rejection with a request for more trials. Even if the drug does make it to market after a delay, it would have to launch amidst several other second-generation oral MS drugs. If such a scenario comes to pass, Teva will need sharp elbows to establish a significant place in the market.

Outlook for selected MS therapies
Annual Sales WW ($m)
Product Company Patent Expiry 2010 2016 Phase (Current)
Copaxone Teva Pharmaceutical Industries May 2014 2,660 2,918 Marketed
Gilenya Novartis Feb 2019 15 2,566 Marketed
BG-12 Biogen Idec - - 2,220 Phase III
Avonex Biogen Idec May 2013 2,518 1,886 Marketed
Tysabri Biogen Idec/Elan Apr 2017 1,240 1,774 Marketed
Rebif Merck KGaA Dec 2013 2,214 1,760 Marketed
Betaferon/Betaseron Bayer Dec 2007 1,600 1,028 Marketed
Laquinimod Teva Dec 2027 - 594 Phase III
Ampyra Acorda Therapeutics Jul 2018 133 449 Marketed
Lemtrada Sanofi Dec 2015 - 345 Phase III
Extavia Novartis - 124 257 Marketed
Teriflunomide Sanofi - - 254 Phase III

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