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Executive Summary

Daily round-up of news and notes from the 2017 J.P. Morgan Healthcare conference in San Francisco. Regeneron CEO rebuffs Amgen’s patent battle strategy; Teva CEO apologizes for reduced financial guidance; Merck looks for more Keytruda wins, combos; Lilly awaits potentially differentiating Phase III CDK4/6 data; Alkermes readies ALKS 5461 depression submission; Biden discusses cancer moonshot, FDA’s real world evidence views; and UniQure turns a corner.




The legal battle between Amgen Inc. and Sanofi /Regeneron Pharmaceuticals Inc. is intensifying over rival PCSK9 blockers for high cholesterol – and words were exchanged in separate investor presentations at the J.P. Morgan Healthcare conference in San Francisco.

Amgen recently won an injunction blocking sales of Sanofi/Regeneron’s Praluent (alirocumab), which was found to infringe patents for Amgen’s Repatha (evolocumab). (Also see "‘Between A Rock And A Hard Place,’ Court Issues Injunction To Halt Praluent Sales" - Scrip, 5 Jan, 2017.) Billions of dollars could be on the line if Sanofi/Regeneron have to take their drug off the market. The two firms plan to appeal the decision and have been granted 45 days to request an appeal and expedited review before having to pull Praluent.

Regeneron CEO Leonard Schleifer expressed disdain for Amgen’s decision to pursue the injunction.

“We said, how about just holding things off for the benefit of patients so we can just get this appeal heard,” Schleifer said. “Now, if you were a company that really cared about patients first, wouldn’t you say, ‘That sounds reasonable, I can get it fixed later, I can get monetary damages, I’m not going to rip this product from 30,000 people or more who are getting it?’.”

“To say that you can’t wait, is that putting patients first? Is that what this business is about?” Schleifer asked. “It’s no small wonder that our industry isn’t beloved.”

Meanwhile, earlier in the day Amgen CEO Robert Bradway also addressed the win from Amgen’s point of view.

“We are pleased that the courts agreed with us that our patents are valid and our competitor chose to launch at risk knowing that they had infringed those patents,” Bradway said. “That’s the nature of the business that we operate in. We have a very successful innovative biopharmaceutical industry in this country, which is based around our ability to invest in risky assets that we believe can be appropriately protected.”


Teva’s Vigodman On Dismal 2017 Financial Update


“That’s something that should not happen and we’ll do everything in our power in order to make sure that something like that does not happen again,” Teva Pharmaceutical Industries Ltd. CEO Erez Vigodman told investors, referring to the lower than expected 2017 financial guidance Teva released Jan. 6.

The company underestimated the revenue coming from new products in 2016. “It had an impact on 2016. It created a new run rate for 2017. We reduced the expectations also for 2017,” Vigodman said. Teva has been struggling to jumpstart growth in its stagnating generic drug business. It’s one reason the company spent $40.5bn to buy Allergan PLC’s generic drug business last year.

The deal is expected to drive substantial growth for the company, but the integration has already run into one surprise. In December, Teva said Sigurdur Olafsson, one of the architects behind the deal and the person charged with leading the integration, would leave the company. He was succeeded by Dipankar Bhattacharjee. (Also see "Teva Appoints New Global Generics Head Amid Massive Integration" - Scrip, 6 Dec, 2016.) There was no mention of the sudden leadership change during Teva’s presentation or break-out.

Investors haven’t been pleased with the slowing growth. The stock is down 36% since the Allergan deal closed July 27. It closed Jan. 9 at $35.06.

Teva said it now expects net revenue in 2017 to be $23.8bn to $24.5bn and earnings per share to be $4.90 to $5.30.


Merck Must ‘Continue To Win In The First Line With Keytruda


The PD-1 inhibitor Keytruda (pembrolizumab) has become a cornerstone of Merck & Co. Inc.’s portfolio and a key catalyst for revenue growth, so it was no surprise during the question-and-answer session after the company’s J.P. Morgan presentation that its executives faced multiples queries about the development and commercialization of the immuno-oncology agent as a monotherapy and in combination with other therapies.

“We have got to continue to win in the first line,” Merck Executive Vice President and President of Global Human Health Adam Schechter said in regard to clinical trials, approvals and payer reimbursement for Keytruda in lung cancer. (Also see "Merck Oncology Strategy: With First-Line Lung Data, A New Day Dawns For Keytruda" - Scrip, 27 Jun, 2016.)


Uptake of PDL-1 testing could happen faster in Europe than in the US


In particular, Schechter said Merck is making progress in Europe with regulators and with payers in various EU countries. (Also see "Merck's Keytruda Wins NSCLC Edge Over BMS' Opdivo" - Scrip, 2 Dec, 2016.) In fact, he noted, European health agencies are more accepting of testing to assess PDL-1 expression prior to administration of Keytruda – a concept that makes sense among price-conscious payers that want to make sure patients most likely to benefit from the drug get access. Uptake of PDL-1 testing could happen faster in Europe than in the US, the executive noted.

Schechter also pointed out that European payers are more receptive to combination immuno-oncology therapy with Keytruda plus chemotherapy than Keytruda plus another immunotherapy, given the potentially high cost of two novel drugs dosed concurrently.

Even so, Merck is studying several combination regimens with Keytruda, including lower cost generic chemotherapies and investigational immuno-oncology agents, such as Incyte Corp.’s oral IDO1 inhibitor epacadostat. The partners announced in the morning before Merck’s Jan. 9 afternoon J.P. Morgan presentation that they will initiate Phase III pivotal studies of Keytruda and epacadostat in four additional tumor types: non-small cell lung cancer, renal cell carcinoma, bladder cancer and squamous cell carcinoma of the head and neck. (Also see "Merck partners with Pfizer, Amgen and Incyte to study promising cancer drug" - Scrip, 5 Feb, 2014.)

“Data from across the ECHO development program for epacadostat continues to be accrued, including from the ECHO-202 Phase II cohorts in combination with Keytruda, which support the decision to move forward into pivotal studies beyond melanoma,” Incyte Chief Medical Officer Steven Stein said in the company’s joint statement with Merck.

The ongoing Phase I and II ECHO studies will enroll more than 900 patients in multiple solid tumor types and hematological malignancies. The Phase III ECHO-301 placebo-controlled study testing the two drugs in first-line advanced or metastatic melanoma began in June and initial data are expected in 2018.

Merck Executive Vice President and President of Merck Research Laboratories Roger Perlmutter acknowledged that it is risky to move Keytruda combinations with earlier-stage immunotherapies into later-stage clinical trials based on evidence from small studies, but he said the company feels confident about certain pivotal programs – like the Incyte studies – based on consistent efficacy across multiple tumor types in those smaller trials.


Lilly Getting Excited About CDK4/6 Inhibitor In Breast Cancer


Eli Lilly & Co. will have its first Phase III data in 2017 for its cyclin dependent kinase 4/6 (CDK4/6) inhibitor abemaciclib in breast cancer, which could show a competitive profile compared with Pfizer Inc.’s drug Ibrance (palbociclib) – the only approved CDK4/6 inhibitor. Both drugs also may have competition this year from Novartis AG’s LEE011, a CDK4/6 inhibitor that was granted priority review in November. (Also see "Novartis CDK4/6 Profile Boosted But Challenge To Pfizer Rival Uncertain" - Scrip, 10 Oct, 2016.)

Lilly Senior Vice President of Clinical and Product Development Daniel Skovronsky told Scrip during an interview in San Francisco that the Phase III MONARCH-2 and MONARCH-3 trials could support regulatory submissions seeking approval of abemaciclib this year.

“I think abemaciclib could be even more important [than Ibrance] for women with breast cancer,” Skovronsky said, noting that Lilly’s drug is more specific for CDK4 than Pfizer’s drug and dials down CDK6 – a mechanistic combination that could improve safety and tolerability. Specifically, Ibrance can cause severe neutropenia, requiring dosing for only limited periods of time, whereas abemaciclib could be dosed continuously. Nonetheless, Pfizer’s drug has secured an entrenched first-to-market position.

The Lilly executive said abemaciclib, if the Phase III studies live up to expectations, could be a good example of providing “value” to patients and payers given the potentially improved safety and efficacy. He noted that drug pricing concerns and the need to demonstrate value to patients is bleeding into the research and development segment of the company.

“We have to align our investments with value to patients,” Skovronsky said, hence investments in R&D programs like abemaciclib, the potential psoriasis blockbuster Taltz (ixekizumab), and Jardiance (empagliflozin) for diabetes, which had its label updated in December to reflect the drug’s cardiovascular benefits. (Also see "Jardiance's Label Expansion Will Change Diabetes Management" - Scrip, 5 Dec, 2016.)

Lilly wants to invest in drugs that change expectations, he said, so that patients will say in five years that they can’t imagine life anymore without certain new medicines.


Alkermes Gearing Up For ALKS 5461 Submission, Expecting 3831 Phase III Data


Alkermes PLC CEO Richard Pops told Scrip in a Jan. 9 interview that the company will have a Type C meeting with the US FDA in February to help agency reviewers understand the totality of Phase III and earlier data for the depression drug ALKS 5461. That discussion will be followed by a pre-NDA meeting in the second quarter to support a new drug application filing this year. (Also see "If Alkermes Antidepressant Can Get Past FDA, The Market Might Be There" - Scrip, 23 Oct, 2016.)

Alkermes said in October that it planned to submit an NDA based on the positive Phase III FORWARD-5 clinical trial and successful mid-stage studies, despite prior Phase III disappointments for the novel drug, which combines buprenorphine and samidorphan (ALKS 33) to act on opioid receptors without the risk of addiction. Pops said the company is spending a lot of time talking to investors – and soon regulators – about the positive results for ALKS 5461 based on the novel trial design used to show efficacy based on a narrow set of depression symptoms. (Also see "Will Alkermes Data Package Support ALKS 5461 Approval?" - Pink Sheet, 23 Oct, 2016.)

“One of the things that I believe we’ve done well is to design these trials to find the signal above the noise,” he said.

While a lot of pharmaceutical companies avoid depression drug development, because of the placebo effect and high failure rate in clinical trials, Pops said Alkermes has tried to understand the indication and design trials to show the best possible efficacy – a strategy that gives the company a leg-up in business development when searching for additional assets in depression and other neurological diseases, he said. Alkermes also is exploring other opioid modulators internally to treat depression as well as bipolar disorder and schizophrenia.

The company will have Phase III data for a drug with a different mechanism in schizophrenia later this year – the oral antipsychotic ALKS 3831, which is similar to Eli Lilly & Co.’s now-generic Zyprexa (olanzapine), but without the weight gain and metabolic side effects associated with the older drug.

“The story around 3831 is going to get more nuanced in 2017,” Pops said.


Vice President Biden Draws A Crowd


Adding to the persistent overcrowding and difficulty getting through the halls of the Westin St. Francis was the surprise addition of US Vice President Joe Biden to the agenda. Security was tightened too with the presence of secret service and metal detectors, and crowds lined up down the hall for a chance to hear the Vice President speak. Much like his drop-in at the American Society for Clinical Oncology annual meeting last year, the VP took the podium to discuss the Cancer Moonshot Initiative.

Regardless of what continues as a US government initiative under the Trump administration, Biden will continue his work under what may or may not be called the Biden Cancer Initiative. The main goals continue to be fostering research and breaking down silos, but the vice president has also targeted access to care and cost of care as priorities in oncology. Biden spoke of payment models based on quality of care and insurance coverage – areas where work is already underway – but in the current climate, drug pricing is likely to be a popular target in oncology.


Taking FDA's Temperature On Real-World Evidence


Industry can expect the US FDA to be on board with increasing use of real-world evidence, particularly in areas of high unmet need, according to attorney Wade Ackerman, who worked closely with the agency on the 21st Century Cures Act.

The legislation, which President Obama signed into law in mid-December, includes a number of provisions related to the use of real-world evidence. For example, the agency will need to assess real-world evidence in support of filings for new indications and for post-marketing requirements. (Also see "Rx For Industry: Key Provisions Of The 21st Century Cures Act" - Scrip, 9 Dec, 2016.)

Some public statements by FDA officials have stirred concerns about how much the agency will embrace real-world evidence and how soon it could become a reality. (Also see "Woodcock, Califf Give Thumbs Up To Certain 21st Century Cures Provisions" - Pink Sheet, 14 Dec, 2016.)

Ackerman, an attorney with Covington and Burling, took an optimistic point of view about regulatory policy during a Jan. 9 panel session on "the real-world evidence revolution" at the Biotech Showcase, held in association with the JP Morgan Healthcare Conference.

As senior FDA Counsel to the US Senate Health Education, Labor & Pensions (HELP) Committee until June, Ackerman was closely involved in crafting the FDA-related provisions of the 21st Century Cures Act. He had previously been associate chief counsel at the agency itself.

Asked about the place for real-world evidence in early and Phase II stages of development, Ackerman noted that there was a provision in the legislation that requires pharmaceutical companies to post expanded access processes and procedures. It wasn't specifically tailored to real-world evidence, but could encourage companies to gather valuable data outside clinical trials.

FDA will be running a pilot program to evaluate the potential of real-world evidence to support supplemental indications and satisfy post-approval safety requirements, which creates a great opportunity depending on a company's product areas, particularly when it comes to unmet needs and drugs for rare diseases, he said.

"There is a lot of gray in this area," Ackerman said, but from his interactions with the agency, FDA appears eager “to find different sponsors to work with to really move this forward.”

The agency’s overall level of commitment to using real-world evidence in regulatory decision-making remains a subject of intense interest. (Also see "Real World Evidence: ‘Hot Topic’ At US FDA, But Not On Front Burner" - Pink Sheet, 15 Dec, 2016.)

There has been some uncertainty about FDA's support following publication of an article by FDA officials in the New England Journal of Medicine Dec. 8, Ackerman acknowledged. The article, titled “Real-World Evidence – What is it and what can it tell us?” was lead authored by Deputy Commissioner For Medical Products And Tobacco Rachel Sherman and co-authored by numerous other officials, including Commissioner Robert Califf.

The FDA officials highlighted the challenges of using real-world evidence and noted that “the clinical trial unquestionably remains a powerful tool" for evaluating products.

There were mixed reactions to this article but "if you read that closely, it's sort of typical FDA – let's not move too fast. But behind closed doors, there was real excitement as we worked with them to put the [21st Century] language together," Ackerman said.


UniQure Turns A Corner, With Lessons Learned


Gene therapy company UniQure NV CEO Matthew Kapusta was stressing three new programs – hemophilia B, heart failure and Huntington's disease – at the J.P. Morgan meeting, with hindsight from experience with the pioneering Glybera, which never really got off the ground.

The company will be talking to regulatory authorities soon regarding the start a pivotal trial of its AMT-060 for hemophilia B and looking to move two other candidates – AMT-130 in Huntington's disease and SL100A1 in congestive heart failure – into the clinic this year.

The heart failure work is being done per a deal with Bristol-Myers Squibb Co. that will involve a total of 10 targets, including four in cardiovascular diseases. (Also see "Bristol’s Dealmakers Aim To Avoid 'Innovator’s Dilemma'" - Pink Sheet, 1 Feb, 2016.) Matthew Kapusta, who in December became CEO from the position of interim CEO, commented in an interview at the meeting that there is growing recognition of the genetic components to heart failure and other cardiovascular diseases.

The company hopes to reach proof-of-concept stage in Huntington's and hemophilia B in 2018. These targets are part of a broader strategic shift that will include refocusing development, manufacturing consolidation and elimination of redundant positions.

UniQure is aiming to be ready for manufacturing on all three programs in its Lexington, Massachusetts facility this year.

UniQure's first gene therapy Glybera (alipogene tiparvovec) was approved in Europe for the very rare lipoprotein lipase deficiency condition in 2012. The product faced a number of hurdles including manufacturing challenges, difficulty identifying eligible patients and high pricing of about €1.1m at the time of launch in 2014. (Also see "How much? Eyes water as first gene therapy Glybera approaches the market" - Scrip, 27 Nov, 2014.)

Kapusta said that experience with Glybera shows that it can get a gene therapy manufactured, approved and reimbursed, validating its technology platform, but that its other programs will drive value going forward.

As for the product's high cost, the exec said that Glybera offers high value, which has been appreciated by some payers. But Kapusta acknowledged that rhetoric on pricing has changed significantly over the last five years and said that its European partner Chiesi Farmaceutici SPA might have a different approach if the product were launched today.

Would they choose to have the most expensive pharmaceutical product in the world – to be billed that way? he asked.

"It's been a little bit of a lightning rod and I am sure our commercial partner would re-evaluate it if they had it to do over again," he said.


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