When Celgene bought out Receptos and its autoimmune drug ozanimod back in 2015 for $7.2 billion in cash, the big biotech bullishly forecast their drug would be worth $4 billion to $6 billion in peak sales. Today, the executive crew started to make good on that projection with a positive readout on the top-line data from their Phase III multiple sclerosis study.
The company says it’s on track to file for an approval of the S1P1 receptor antagonist this year.
Investigators weren’t handing out any hard data today. But the company says that ozanimod delivered “statistically significant and clinically meaningful improvements compared to Avonex for the primary endpoint of ARR (the annualized relapse rate) and the measured secondary endpoints of the number of gadolinium-enhancing MRI lesions and the number of new or enlarging T2 MRI lesions at month 12.”
A second Phase III study in MS will read out in Q2.
This is a tough market, though. To get anywhere close to $6 billion, efficacy alone won’t cut it. Celgene will also have to prove a substantial safety advantage with their drug.
Just a few days ago Geoffrey Porges at Leerink outlined the strategy for ozanimod.
Results from the two Ozanimod phase III trials in multiple sclerosis are due in the first half of this year, with phase III ulcerative colitis data expected in the first half of 2018. CELG always assumed ozanimod would get same class labeling matching other S1P1 inhibitors such as Gilenya, but also anticipate that the phase III safety data would be in the label so that CELG could discuss the potential differences with physicians and payers. CELG stated the company needs to see “really good efficacy” and a similar lack of cardio and liver toxicity as shown in the phase II trial. About 15% of patients discontinue Gilenya due to these toxicity issues. CELG stated that pricing will be lower in UC when the drug is launched in that indication, and the company plans to use discounts by indication or other methods to match the existing pricing in the MS and IBD indications (at a list price similar to the existing $90,000 Gilenya price).
The company said today that the safety profile of the drug is in line with their Phase II results. And they sounded pumped about the prospects of their inflammation and immunology pipeline.
Jefferies’ Brian Abrahams gave the company a quick thumbs up, noting that there’s a long way to go before this drug lives up to expectations.
We currently model out-year MS sales of ozanimod of ~$1B, given the potential Gilenya genericization, increasing competition, and growing pricing pressure in the MS space. While it is not clear whether CELG would detail the agent on their own, the company has recently shown more openness to using ozanimod as a cornerstone to build out a broader neurology commercial/development platform. In IBD, we assume peak sales approaching ~$3.5B in the out-years, and while key ph.III UC data is not expected until 2018, we could see some initial Crohn’s disease data that could help clarify its profile and expanded IBD potential.
“People living with multiple sclerosis need additional therapies and we are pleased that oral ozanimod showed meaningful improvements across primary and measured secondary endpoints in this study,” said Scott Smith, president of Celgene Inflammation and Immunology. “We look forward to data from the confirmatory phase III RADIANCE trial in the second quarter as we advance toward planned regulatory submissions by year-end.”
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