Persistence, and a higher dose, pays off for Lundbeck and Otsuka

Rushing to regulators with shaky data is a frequently fated strategy that a remarkable number of developers pursue, so Lundbeck and Otsuka’s approach with Rexulti comes as a breath of fresh air. Mixed results from two previous trials in agitation caused by Alzheimer’s disease prompted a third, larger study, which generated the desired outcome. Primary and key secondary endpoints were hit, the partners said yesterday, giving both stocks an 8% bump and opening what analysts described as a $500m opportunity. The details remain crucial, particularly on absolute effect size across the two doses tested. A 3mg dose was evaluated alongside the previously trialled 2mg, and while the assumption is that this boosted effectiveness, absence of a dose response will muddy the waters. Either way, Rexulti is hugely important for both companies. It is Otsuka’s biggest sales growth driver, and one of the products that Lundbeck is relying on to reinvigorate growth after a series of patent expiries. On a call yesterday the Danish company hinted that deals to beef up its mid-stage pipeline will now be considered; the group has a mixed track record here but at least the opportunities for cash-rich buyers are growing in the current climate.