Tecfidera hits the ground running with FDA thumbs up

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The FDA dashed any waning hope among Biogen Idec’s competitors that the three-month delay to the action date for the multiple sclerosis pill Tecfidera presaged a complete response letter. Approval came a day before tomorrow's deadline and with a clean-looking label that should allow the Massachusetts group to ramp up its efforts to make it a first-choice treatment.

Biogen has so far kept mum on the news the sector is most awaiting: pricing for the third leg of its MS franchise. Nevertheless, analysts are betting on quick takeup, with the second pill to hit the US market racking up blockbuster numbers in 2014 on its way to becoming the company’s biggest growth driver.

Doubling up

The FDA approval capped off a good week for Biogen and Tecfidera; the decision came just six days after European regulators announced their backing. Shares jumped 3% to a record high of $182.68 following news of the FDA’s action on what is forecast to be the biggest launch of the year by far (Which of 2013's launches will become blockbusters?, January 23, 2013). 

Although a benign label was expected for Tecfidera, known also by its research code BG-12, there was a sigh of relief that the agency did not raise any safety worries. The product information calls for annual white blood cell monitoring – a routine practice – while a known cancer signal in rats and mice merited a mention.

The pill has not shown itself to be as powerful in reducing relapse rates as Biogen’s Tysabri, nor was it able to show that it significantly slowed disability progression as well as the interferon-betas, Biogen’s Avonex and Merck KGaA’s Rebif. But it clearly has a safety advantage – Tysabri has the black box warning for the brain infection progressive multifocal leukoencephalopathy, and interferons are well known for their side effects of flu-like symptoms and depression.

Thus there appear to be few clinical barriers to wide adoption of Tecfidera (Event – Tecfidera odds-on for US nod but first-line use not assured, March 7, 2013). As with all new drugs, however, there will probably be a conservative approach among specialists – experience in managing the side effects of tried and tested medications might win out when considering the unexpected issues arising from a product that has just been launched.

Outlook

EvaluatePharma’s consensus data forecasts sales of $3.73bn in 2018, giving the compound a net present value of $11.5bn, a total of more than a quarter of Biogen’s market capitalisation. Such sky-high expectations can of course be dashed; see, for example, Amarin’s Vascepa, which was widely expected to be a $2bn-a-year drug by 2016 but has been felled by a series of commercial and intellectual property blunders.

But Tecfidera appears to be mercifully free of those worries, although of course success will be contingent on how Biogen executes its launch. Pricing is the big question here: analysts expect anything up to $60,000 a year.

Leerink Swann analyst Marko Kozul wrote today that some key opinion leaders were hoping for a price in the low-to-mid $40,000 range to encourage takeup, suggesting that the higher estimates could damp down current enthusiasm. By comparison, Gilenya, the only other oral drug on the US market, is priced at about $56,000 a year.

Given Biogen’s experience in the MS space, it would be surprising to see it botch such an important decision. The group’s beefy market valuation is riding on it.

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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