OSI wins Tarceva label expansion, but Astellas unmoved

Over the weekend OSI Pharmaceuticals announced that the FDA granted expanded approval for Tarceva in a first-line maintenance setting in lung cancer, a somewhat surprising outcome given the unequivocal thumbs down the drug received from an advisory committee last year (Event – OSI’s flagship Tarceva awaiting approval extension as bid rumbles on, April 1, 2010).

The marginal benefit bestowed by Tarceva was largely the reason the panel declined to recommend approval, a stance the regulator clearly chose to ignore. This is uncommon, but not without precedent; Avastin was approved to treat metastatic breast cancer despite a negative vote by an advisory committee and little evidence of substantial efficacy. Perhaps in these situations, where the drug is already on the market, the regulator is prepared to veer away from the pure statistical argument and take a more holistic view of a drug’s usefulness to patients.

Niche setting

There is only one other lung cancer drug approved in a maintenance setting, Eli Lilly’s chemotherapy agent Alimta, which is also used first line. With the FDA decision Tarceva is approved both as a second-line therapy following the failure of chemotherapy and now in this new setting, for patients whose disease has not progressed after four cycles of chemotherapy.

The pivotal study that won Alimta approval in this setting demonstrated a five month advantage in overall survival, over placebo. Tarceva demonstrated only a one month advantage, hence the doubts about approval.

As such, analysts are not expecting the new US label, which follows a recommendation for approval in the same setting in Europe, to add much to sales. JP Morgan recently estimated $100m in both regions could be generated.

Few options

So why did the FDA decide to grant approval?

It could be because Alimta cannot be used in squamous lung cancers, whereas Tarceva can be used in both squamous and non-squamous histologies, thereby giving doctors another option for the former subset of patients.

It could also reflect recognition that with widespread clinical use over time, a much deeper understanding of a drug’s potential is garnered. Tarceva did not completely fail in this setting, and as the FDA is not concerned about the cost of treatments they could have taken the view that there was no real reason not to grant wider approval, given the few options remaining for these very sick patients.

Surprising omission

What is perhaps surprising is that the label does not refer to EGFR mutations, given mounting evidence that the drug is much more effective in a subset of patients with an activating EGFR mutation.

This seems a particularly notable omission viewed in the light of results from the phase II Battle study announced this weekend at the American Association for Cancer Research meeting, which tested a range of tumour biomarkers including EGFR and KRAS and found evidence that they can help predict the optimum lung cancer therapy.

Although the debate about biomarkers has really only just begun, there seems little doubt that over time all targeted cancer therapies, from the anti-VEGF mabs like Avastin to the EGFR kinase inhibitors like Tarceva, will become even more targeted to specific tumour types.

Over time, this will no doubt be reflected in drug labels. For now, OSI and partner Roche can promote Tarceva very widely and doctors will perhaps feel more comfortable trying the agent in a new setting. How widespread its use will become remains to be seen, as the presentation of maintenance data at last year’s Asco did not receive a hugely warm welcome (ASCO - New lung cancer treatment strategy has sceptics as well as fans, June 3, 2009). 

Bid situation

The other aspect to this approval is the ongoing bid situation for OSI, with Astellas swiftly stating that this approval would make no difference to its position. However, quoted in various press reports, the Japanese company did appear to suggest that its offer price, currently pitched at $52, could rise as a result of the current due diligence process.

With OSI’s stock currently trading just shy of $60 hopes remain high for a loftier price emerging. The shares were little moved on the approval news, however, suggesting that Astellas is looking for bigger reasons to raise its price.

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