J&J pitch­es its top 11 drugs in the pipeline — with a peak sales promise of $1B-plus

Joaquin Du­a­to at an End­points News event in San Fran­cis­co on Jan­u­ary 10, 2017


Over the last six years, J&J has nailed 11 new drug ap­provals. Look­ing for­ward over the next five years, the phar­ma gi­ant is fore­cast­ing that it can dou­ble that, with more than 10 new ap­provals for block­buster meds out of its late-stage pipeline. And it needs them all to keep up with an am­bi­tious growth fore­cast for its phar­ma di­vi­sion rev­enue.

Joaquin Du­a­to, J&J’s world­wide chair­man for phar­ma­ceu­ti­cals, com­mit­ted to see­ing J&J’s brand­ed drug mar­ket main­tain a clip of 5% an­nu­al growth through 2020, de­spite some stiff “head­winds” on prices — “where price growth is flat­ten­ing” — with three ap­provals slat­ed for 2017 and four more which the phar­ma gi­ant ex­pects to ush­er in­to the mar­ket in 2018.

These new drugs are one leg of the com­pa­ny’s three-leg strat­e­gy for grow­ing rev­enue, with a promise that it can im­prove sig­nif­i­cant­ly on ex­ist­ing drugs — like Ste­lara, In­vokana and Xarel­to — while beef­ing up on a new core fo­cus on pul­monary ar­te­r­i­al hy­per­ten­sion through the Acte­lion buy­out.

Bill Hait, glob­al head of R&D, said he ex­pects 14 new meds to ar­rive in next five years, with 50 line ex­ten­sions on al­ready ap­proved ther­a­pies.

Bill Hait

First up, the two new im­munol­o­gy drugs al­ready filed for ap­proval and well known to in­vestors: guselkum­ab for pso­ri­a­sis; and sirukum­ab for rheuma­toid arthri­tis.

The next nine po­ten­tial block­busters cov­er a range of core fo­cus­es, with a ma­jor con­cen­tra­tion on on­col­o­gy. They are:

  • Apa­lu­tamide (ARN-509) for pre-metasta­t­ic prostate can­cer. J&J picked up this drug with its $1 bil­lion deal for Aragon.
  • Es­ke­t­a­mine for treat­ment-re­sis­tant de­pres­sion. This is an in­tranasal ver­sion of ke­t­a­mine, a horse tran­quil­iz­er and well known par­ty drug (Spe­cial K) known for rapid on­set with a host of side ef­fects.
  • Ta­la­co­tuzum­ab (JNJ-56022473/CSL362) for acute myeloid leukemia. This drug, orig­i­nal­ly from CSL, us­es Xen­cor’s an­ti­body tech.
  • Erdafi­tinib (an FGFR In­hibitor) for sol­id tu­mors.
  • Ni­ra­parib for prostate can­cer. Al­ready ap­proved in the US ear­li­er this year as Ze­ju­la, J&J picked up com­mer­cial rights on this PARP in­hibitor in a $500 mil­lion deal.
  • Ime­tel­stat for myelofi­bro­sis. Geron re­vealed a few weeks ago that J&J’s re­view of the da­ta from two stud­ies of its drug ime­tel­stat war­rant­ed con­tin­ued work in myelodys­plas­tic syn­dromes and myelofi­bro­sis. But the phar­ma gi­ant $JNJ is still re­serv­ing the right to quit if the da­ta doesn’t hold up lat­er in the year. That’s not a big vote of con­fi­dence.
  • Pi­modi­vir (JNJ-3872) for in­fluen­za A. J&J picked up this one from Ver­tex in 2014. Not much has been heard about it since then.
  • Lu­mic­itabine (JNJ-1575) for res­pi­ra­to­ry syn­cy­tial virus (RSV) in­fec­tion. J&J got this in their $1.75 bil­lion buy­out of Alios in 2014, which al­so net­ted drugs for hep C — a mar­ket that is be­ing flat­tened by some very ef­fec­tive cures.
  • JNJ-7922 (orex­in-2 an­tag­o­nist) for ad­junc­tive treat­ment for ma­jor de­pres­sive dis­or­der. This is a new one on me.

Ge­off Meacham at Bar­clays gave J&J’s pre­sen­ta­tion to­day sol­id marks for the longterm, but he sees an up­hill strug­gle at the phar­ma gi­ant as it wres­tles with some dis­ap­point­ing rev­enue num­bers. His note:

JNJ’s in­creas­ing em­pha­sis on on­col­o­gy (Darza­lex, apa­lu­tamide, ni­ra­parib, ta­la­co­tuzum­ab for AML) is a pos­i­tive step, which should of­fer bet­ter pric­ing pro­tec­tion vs. oth­er ther­a­peu­tic cat­e­gories such as im­munol­o­gy (biosim­i­lars) and di­a­betes (SGLT-2s).  JNJ is tar­get­ing above-mar­ket growth over the next decade, which we think is like­ly achiev­able, but our sense is that in­vestor con­vic­tion is low in con­vert­ing the port­fo­lio from lega­cy as­sets to new launch­es (e.g. apa­lu­tamide for Zyti­ga, guselkum­ab/sirukum­ab for Rem­i­cade). In­deed, while there is like­ly a sus­tained pe­ri­od of ac­cel­er­a­tion of in­ter­nal­ly dri­ven, or­gan­ic growth in the in­ter­me­di­ate-to-longer term, the next 1-2 years may be tough with the pend­ing Acte­lion deal pro­vid­ing a fix but not one that is like­ly to dri­ve mul­ti­ple ex­pan­sion.

It’s im­por­tant to re­mem­ber that the suc­cess rate for Phase III drugs is about 50%, and pay­ers have been rad­i­cal­ly al­ter­ing the land­scape for new drug prices. That all presents J&J with some big po­ten­tial pit­falls along the way to achiev­ing its goals. But with a $7 bil­lion an­nu­al bud­get for R&D, Du­a­to and Hait want in­vestors to know what they can ex­pect for the mon­ey.

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Despite the promised decentralized trial revolution, we haven’t yet moved the needle in a significant way, although we are seeing far bolder commitments to this as we continue to experience the pandemic restrictions for some time to come. The vision of grandeur is one thing, but operationalizing and execution are another and recognising that change, particularly mid-flight on studies, is worthy of thorough evaluation and consideration in order to achieve success. Here we will discuss one of the critical building blocks of a Decentralized and Remote Trial strategy: TeleConsent; more than paper under glass, it is a paradigm change and key digital enabler.

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