Traffic Transports Vertex back onto the right track

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What looked like becoming an annus horribilis for Vertex Pharmaceuticals has been turned on its head with positive data from the Traffic and Transport studies of its cystic fibrosis combination, announced this morning.

The phase III readout had been hailed as biotech’s most important binary event of 2014, but until today Vertex’s stock was off 10% year to date. Were it not for short covering and the caution in the runup to the results, this morning’s 50% surge might look overdone; the data, while clearly positive, are perhaps not overwhelming.

Traffic and Transport were two studies of near-identical design testing Vertex’s marketed cystic fibrosis drug, Kalydeco, combined with a CFTR corrector, lumacaftor (VX-809). The combo represents Vertex’s strategy to turn Kalydeco from a decently selling drug to an exceptional one, expanding into F508del homozygotes and growing the target population from under 3,000 patients to up to 28,000.

Despite the promise, caution had set in, as reflected in this year’s dismal performance of Vertex stock until today. One reason was the ambiguous result of a separate study of a different Vertex CFTR corrector, VX-661 (Event – Key Vertex readout becomes biotech’s 2014 damp squib, May 12, 2014).

Fears unfounded

In the event, it now seems that the fears were unfounded, as both Traffic and Transport met their primary endpoints of an absolute 24-week improvement in FEV1, favouring the Vertex combo over placebo with a high level of statistical significance.

Moreover each dose level tested beat placebo on this measure in each study, and of course the pooled data from the two trials also strongly favoured both doses – lumacaftor 600mg a day plus Kalydeco 250mg twice a day, and lumacaftor 400mg twice a day plus Kalydeco 250mg twice a day – each with p<0.0001 versus placebo.

The major worry now as far as the primary endpoint goes is whether the underlying benefit is strong enough clinically; depending on the dose used the FEV1 benefit ranged from 2.6 to 4.0 percentage points. Some analysts had expected a stronger result, notwithstanding the clear significance of the benefit in statistical terms.

ISI Group’s Mark Schoenebaum said the final data were “not a home run”, but called them good and supportive of approval. UBS analysts were more bullish, stating that the results were “unambiguously positive”.

Apart from the relative modesty of the benefit, the fact that the FEV1 curves waned towards the end of the 24-week period was also questioned, though on today’s call Vertex said the totality of the result was what counted. The company also highlighted the primary benefit’s alignment with important secondary measures.

One secondary endpoint, the mean relative percentage change in FEV1 versus placebo, was also hit statistically by both combo doses. Vertex had got into a muddle a couple of years back over the distinction between an absolute and a relative change, but this time there was no ambiguity.

The company highlighted a pooled analysis showing that 39-46% of treatment recipients had a greater than 5% improvement in FEV1, and 24-27% a more than 10% improvement – both at p<0.0003. Mr Schoenebaum said the secondary endpoint data were mixed, though “all arms appeared to trend in the right direction”, with pooled data hitting statistical significance on the relatively tough endpoints of pulmonary exacerbations and change in body mass index.

Pricing

Yet to be decided is the pricing of the combo, and this could turn into a controversial issue, especially if the clinical benefit is seen more broadly as being on the modest side.

A 50% discount to Kalydeco monotherapy would represent some $150,000 per patient per year, and appears to support sellside models that see combo sales of $3bn a year and above. Vertex said it was premature to talk about pricing.

Vertex’s micromanaging of the release of Traffic and Transport data can also be questioned. Several prominent news outlets – not including EP Vantage – were supplied with the results yesterday under embargo; if the data really are as good as the markets take them to be, little has been gained by so stringently managing the news process.

One way or another, attention will now turn to filing the Kalydeco combo, as well as to progress in combining Kalydeco with VX-661, which has better lung penetration and fewer drug interactions than lumacaftor.

A triple combination would open the door to treating the F508del heterozygous population – something that, thanks to Traffic and Transport, is back on the cards. It cannot be denied that, after a wobble, Vertex’s plan to dominate cystic fibrosis is on track again.

Study Trial ID
Traffic NCT01807923
Transport NCT01807949

To contact the writer of this story email Jacob Plieth in London at jacobp@epvantage.com or follow @JacobEPVantage on Twitter

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