Short investors loved to hate Puma Biotechnology, taking the company $PBYI to task for the side effects that hampered its lead cancer drug neratinib. But the FDA had no trouble sanctioning the product for breast cancer, approving it today for use in preventing recurrence of the disease after the biotech gained a lopsided vote in its favor among outside agency experts.
The FDA approved neratinib — to be sold as Nerlynx — for preventing the return of breast cancer after therapy including trastuzumab. And the emphasis in the OK was on adding options for doctors and patients.
“HER2-positive breast cancers are aggressive tumors and can spread to other parts of the body, making adjuvant therapy an important part of the treatment plan,” said Richard Pazdur, M.D., director of the FDA’s Oncology Center of Excellence and acting director of the Office of Hematology and Oncology Products in the FDA’s Center for Drug Evaluation and Research. “Now, these patients have an option after initial treatment that may help keep the cancer from coming back.”
There are some caveats in the label. Concerned about the high rate of Grade 2 and Grade 3 diarrhea in the clinical studies, regulators are telling physicians to stop using the drug if their patient experiences Grade 4 diarrhea or Grade 2 after a maximum dose reduction. But Michael Schmidt at Leerink sees the pluses as well in a broad label:
The product label looks broad, not restricting use to specific patient populations (e.g., hormone-receptor [HR] positive patients) and there is no black box warning. The prescribing information contains fairly detailed information about the use of antidiarrheal prophylaxis measures, providing specific information on how to manage the drug’s main side effect.
Puma says it isn’t releasing the price yet and has no timeline on that. Its stock price still had some upside left after the OK, though, with shares surging 7.5% on a company with a $3.2 billion market cap. Now that the approval has come through, look for lots more chatter about Puma as a potential takeover target — even though M&A has largely been MIA this year in biotech.
The FDA experts raised a variety of concerns in their review of neratinib, making some points that could hinder the drug’s market potential now that Puma CEO Alan Auerbach has a green light to sell it. Critical to its success is a better understanding of its proper role in treating breast cancer, and the limits of its effectiveness.
To get here, Puma had to overcome regulators’ objections in the spring of 2016 to filing the drug with the data that were available, citing a problematic approach to deciphering the results. The shorts were also fixated on a high rate of grade 3 diarrhea in the trials, but experts hardly paid any attention to that, happy to trade off the potential for manageable side effects for a chance of adding a new arrow to their quiver of therapies.
“There’s no exclamation point after my ‘yes’,” said Andrew Seidman, an oncologist at Memorial Sloan Kettering after the FDA vote. “It’s just a yes.” He added that he was happy that the drug looks durable and the statistical analyses applied to the data given the significant changes to the study design. “I do think that physicians will select patients very selectively for using this,” he noted, echoing a concern that the approval the company was seeking was too broad given the data available.
Puma’s position has been heightened after analysts favorably compared neratinib’s 34% reduction in the risk of recurrence or death against a marginal improvement seen in a Roche combination study of Perjeta and Herceptin. It takes a leap to do these kinds of cross-trial analyses that drive drug developers a tad crazy now and then, but Wall Street analysts were quick to give Puma a thumbs up, particularly after it had just handily won the FDA panel vote.
EvaluatePharma pegged 2022 sales at $1.25 billion, making it one of the top 15 drugs in the industry pipeline at the beginning of this year.
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