Co­herus looks to dis­rupt Am­gen’s $4B Neu­las­ta fran­chise as an­a­lysts look for a deep dis­count on its copy­cat price

De­spite be­ing the run­ner-up in the race to a US ap­proval for a biosim­i­lar of Neu­las­ta, an­a­lysts are watch­ing to see if lit­tle Co­herus could gain quick trac­tion if they sell theirs at a big dis­count to My­lan’s ri­val.

On Fri­day, Co­herus said it had se­cured the FDA’s nod for a copy­cat ver­sion of Am­gen’s block­buster prod­uct — com­ing sec­ond to My­lan $MYL and In­di­an part­ner Bio­con in the race to mar­ket a biosim­i­lar for Neu­las­ta in the more lu­cra­tive US mar­ket. Co­herus’ biosim­i­lar, Uden­cya, was grant­ed Eu­ro­pean ap­proval in Sep­tem­ber.

Ken Cac­cia­tore

Neu­las­ta, which is used to thwart in­fec­tions in can­cer pa­tients, ac­count­ed for near­ly a fifth of Am­gen’s net prod­uct sales in the third quar­ter, bring­ing in about $1.05 bil­lion but this ap­proval has added more pres­sure to the drug’s al­ready weak­en­ing rev­enue out­look. Mean­while, No­var­tis $NVS is al­so plan­ning to re­sub­mit an ap­pli­ca­tion to mar­ket its once-re­ject­ed Neu­las­ta biosim­lar next year.

Out­side of the US, Neu­las­ta on­ly rep­re­sents a rough­ly $500 mil­lion op­por­tu­ni­ty, which mean the core fo­cus is on the sig­nif­i­cant­ly more lu­cra­tive $4 bil­lion US mar­ket and even mod­est pen­e­tra­tion with this as­set alone could mean­ing­ful­ly stem Co­herus’ cash burn — and/or po­ten­tial­ly lead to prof­itabil­i­ty, said Cowen an­a­lyst Ken Cac­cia­tore in a note. “Even at a 40%+ price dis­count, on­ly 10% of the mar­ket would al­low Co­herus…to turn cash-flow breakeven while still sup­port­ing a ro­bust de­vel­op­ment pipeline.”

The FDA ap­proval for Co­herus’ Uden­cya comes lat­er than ex­pect­ed as the reg­u­la­tor de­clined to ap­prove the drug last June, ask­ing the com­pa­ny to con­duct a re-analy­sis of ex­ist­ing da­ta with a more sen­si­tive as­say. De­tails on the drug’s com­mer­cial­iza­tion plan will be pro­vid­ed on the com­pa­ny’s Nov. 8 quar­ter­ly earn­ings call, the Red­wood City, Cal­i­for­nia-based com­pa­ny said in a state­ment.

“The list price of Neu­las­ta has near­ly tripled since ap­proval in 2002 and now rep­re­sents a $4 bil­lion an­nu­al cost bur­den in the U.S…and Udeny­ca will play an im­por­tant role in curb­ing that spend when launched,” said Co­herus chief Den­ny Lan­fear.

Jim Has­sard

In Co­herus’ sec­ond quar­ter con­fer­ence call in Au­gust, se­nior VP of mar­ket­ing Jim Has­sard not­ed that the list price of Neu­las­ta is about $6200 per pre-filled sy­ringe, and its av­er­age sell­ing price — as pub­lished by CMS — is about $4200. My­lan came to the mar­ket with a price that is about 6% low­er than the av­er­age sell­ing price, he said, and an­a­lysts con­curred that My­lan’s launch had thus been fair­ly ane­mic due to its mod­est dis­count.

Over­all, Co­herus man­age­ment has in­di­cat­ed Uden­cya could be in a po­si­tion to cap­ture rough­ly 10-20% of the cur­rent US mar­ket fol­low­ing the first full year of launch, not­ed Cowen’s Cac­cia­tore. “Al­though there still re­mains some con­tro­ver­sy about po­ten­tial pen­e­tra­tion rates and pric­ing/con­tract­ing strate­gies, we be­lieve this is a rea­son­able ex­pec­ta­tion. We con­tin­ue to find it dif­fi­cult to be­lieve that if the sup­ply is con­sis­tent, and if there is a per­cep­tion that the qual­i­ty of the prod­uct is high, that there will not be mean­ing­ful share that would be will­ing to move to a sig­nif­i­cant­ly dis­count­ed prod­uct (40% +).”

Ge­of­frey Porges, Leerink

Al­though Co­herus’ pric­ing strat­e­gy is un­clear, they have been in ac­tive dis­cus­sion with pay­ers and oth­er stake­hold­ers, and ap­pear to have more than enough sup­ply in place in tan­dem with a man­u­fac­tur­ing ca­pac­i­ty that is pow­ered to sup­port a mar­ket share of 28%, Leerink’s Ge­of­frey Porges wrote in a note, adding that an­oth­er per­ceived ad­van­tage Co­herus has is that all its prod­ucts are man­u­fac­tured in the US, un­like My­lan’s Neu­las­ta copy­cat Ful­phi­la that is made by Bio­con in In­dia.

“Co­herus al­so learned the les­son from Am­gen to pro­vide billing and co-pay as­sis­tance to physi­cians and pa­tients, re­spec­tive­ly, and is aim­ing to match the ‘white glove’ ser­vice Am­gen pro­vides…they could con­tribute to greater-than-ex­pect­ed ear­ly share gains for Co­herus, should they match Am­gen’s sales sup­port,” he said.

Am­gen last year sued Co­herus, ac­cus­ing the com­pa­ny of a mas­sive con­spir­a­cy by poach­ing its em­ploy­ees and spurring them to use their trade se­crets to stim­u­late the de­vel­op­ment of Co­herus’ slate of biosim­i­lars. Lan­fear pre­vi­ous­ly served as Am­gen’s VP of mar­ket de­vel­op­ment, while Co­herus’ chief sci­en­tif­ic of­fi­cer and chief tech­ni­cal of­fi­cer have al­so both worked at Am­gen. Co­herus de­nied the charges.

Co­herus’ shares were up about 5.7% in pre­mar­ket trad­ing on Mon­day.

It’s fi­nal­ly over: Bio­gen, Ei­sai scrap big Alzheimer’s PhI­I­Is af­ter a pre­dictable BACE cat­a­stro­phe rais­es safe­ty fears

Months after analysts and investors called on Biogen and Eisai to scrap their BACE drug for Alzheimer’s and move on in the wake of a string of late-stage failures and rising safety fears, the partners have called it quits. And they said they were dropping the drug — elenbecestat — after the independent monitoring board raised concerns about…safety.

We don’t know exactly what researchers found in this latest catastrophe, but the companies noted in their release that investigators had determined that the drug was flunking the risk/benefit analysis.

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Lisa M. DeAngelis, MSKCC

MSK picks brain can­cer ex­pert Lisa DeAn­ge­lis as its next CMO — fol­low­ing José Basel­ga’s con­tro­ver­sial ex­it

It’s official. Memorial Sloan Kettering has picked a brain cancer expert as its new physician-in-chief and CMO, replacing José Baselga, who left under a cloud after being singled out by The New York Times and ProPublica for failing to properly air his lucrative industry ties.

His replacement, who now will be in charge of MSK’s cutting-edge research work as well as the cancer care delivered by hundreds of practitioners, is Lisa M. DeAngelis. DeAngelis had been chair of the neurology department and co-founder of MSK’s brain tumor center and was moved in to the acting CMO role in the wake of Baselga’s departure.

Penn team adapts CAR-T tech, reengi­neer­ing mouse cells to treat car­diac fi­bro­sis

After establishing itself as one of the pioneer research centers in the world for CAR-T cancer therapies, creating new attack vehicles to eradicate cancer cells, a team at Penn Medicine has begun the tricky transition of using the basic technology for heart repair work.

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Tal Zaks. Moderna

The mR­NA uni­corn Mod­er­na has more ear­ly-stage hu­man da­ta it wants to show off — reach­ing new peaks in prov­ing the po­ten­tial

The whole messenger RNA field has attracted billions of dollars in public and private investor cash gambled on the prospect of getting in on the ground floor. And this morning Boston-based Moderna, one of the leaders in the field, wants to show off a few more of the cards it has to play to prove to you that they’re really in the game.

The whole hand, of course, has yet to be dealt. And there’s no telling who gets to walk with a share of the pot. But any cards on display at this point — especially after being accused of keeping its deck under lock and key — will attract plenty of attention from some very wary, and wired, observers.

“In terms of the complexity and unmet need,” says Tal Zaks, the chief medical officer, “this is peak for what we’ve accomplished.”

Moderna has two Phase I studies it wants to talk about now.

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It's not per­fect, but it's a good start: FDA pan­elists large­ly en­dorse Aim­mune's peanut al­ler­gy ther­a­py

Two days after a fairly benign review from FDA staff, an independent panel of experts largely endorsed the efficacy and safety of Aimmune’s peanut allergy therapy, laying the groundwork for approval with a risk evaluation and mitigation strategy (REMS).

Traditionally, peanut allergies are managed by avoidance, but the threat of accidental exposure cannot be nullified. Some allergists have devised a way to dose patients off-label with peanut protein derived from supermarket products to wean them off their allergies. But the idea behind Aimmune’s product was to standardize the peanut protein, and track the process of desensitization — so when accidental exposure in the real world invariably occurs, patients are less likely to experience a life-threatening allergic reaction.

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Rit­ter bombs fi­nal PhI­II for sole lac­tose in­tol­er­ance drug — shares plum­met

More than two years ago Ritter Pharmaceuticals managed to find enough silver lining in its Phase IIb/III study — after missing the top-line mark — to propel its lactose intolerance toward a confirmatory trial. But as it turned out, the enthusiasm only set the biotech and its investors up to be sorely disappointed.

This time around there’s little left to salvage. Not only did RP-G28 fail to beat placebo in reducing lactose intolerance symptoms, patients in the treatment group actually averaged a smaller improvement. On a composite score measuring symptoms like abdominal pain, cramping, bloating and gas, patients given the drug had a mean reduction of 3.159 while the placebo cohort saw a 3.420 drop on average (one-sided p-value = 0.0106).

Ear­ly snap­shot of Ad­verum's eye gene ther­a­py sparks con­cern about vi­sion loss

An early-stage update on Adverum Biotechnologies’ intravitreal gene therapy has triggered investor concern, after patients with wet age-related macular degeneration (AMD) saw their vision deteriorate, despite signs that the treatment is improving retinal anatomy.

Adverum, on Wednesday, unveiled 24-week data from the OPTIC trial of its experimental therapy, ADVM-022, in six patients who have been administered with one dose of the therapy. On average, patients in the trial had severe disease with an average of 6.2 anti-VEGF injections in the eight months prior to screening and an average annualized injection frequency of 9.3 injections.

Alex Ar­faei trades his an­a­lyst's post for a new role as biotech VC; Sanofi vet heads to Vi­for

Too often, Alex Arfaei arrived too late. 

An analyst at BMO Capital Markets, he’d meet with biotech or pharmaceutical heads for their IPO or secondary funding and his brain, trained on a biology degree and six years at Merck and Endo, would spring with questions: Why this biomarker? Why this design? Why not this endpoint? Not that he could do anything about it. These execs were coming for clinical money; their decisions had been made and finalized long ago.

Arde­lyx bags its first FDA OK for IBS, set­ting up a show­down with Al­ler­gan, Iron­wood

In the first of what it hopes will be a couple of major regulatory milestones for its new drug, Ardelyx has bagged an FDA approval to market Ibsrela (tenapanor) for irritable bowel syndrome.

The drug’s first application will be for IBS with constipation (IBS-C), inhibiting sodium-hydrogen exchanger NHE3 in the GI tract in such a way as to increase bowel movements and decrease abdominal pain. This comes on the heels of two successful Phase III trials.