Amgen’s osteoporosis med almost a home run in latest trial; fate now murky on heart safety

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The News:

Amgen Inc. (Thousand Oaks CA) and UCB SA (Brussels) no longer expect their experimental osteoporosis drug to win US approval this year after a higher rate of serious heart-related side effects were observed in a late-stage clinical trial.

@Amgen, @UCB_News don't expect their new #osteoporosis drug to win US approval this year Click To Tweet

The drug, romosozumab, which would be sold under the brand name Evenity if approved, is awaiting a decision by the Food and Drug Administration, according to Reuters. It’s designed to increase bone formation and density, thereby reducing the risk of fractures.

But the new safety data, which arose unexpectedly in an otherwise successful trial, will have to be taken into consideration, delaying any FDA decision and leaving the product’s future uncertain. The agency had been expected to make a ruling in July.

The news is a blow for both companies and the setback hit smaller Belgium-based UCB hard, sending its shares down 18% so far for the week. The problem adds to doubts about UCB’s long-term growth prospects, given looming biosimilar competition to its Cimzia arthritis drug.

Amgen shares were down just 1% by Tuesday. The uncertainty over romosozumab sent shares of Radius Health Inc. (Waltham MA) up 7%, as its rival drug that won US approval in April will not face competition from much larger Amgen any time soon.

The companies did not disclose the nature or severity of the heart-related side effects, but Leerink analyst Geoffrey Porges said he believed romosozumab now had only a 50/50 probability of coming to market.

ISI Evercore analyst Umer Raffat in a research note called the new data “clearly negative and very surprising.” Raffat said he was removing all sales of romosozumab from his Amgen forecast models.

The drug had been viewed as a potentially important future growth driver for both Amgen and UCB. Analysts on average were forecasting annual sales of the drug to reach about $720 million by 2023, according to Thomson Reuters data.

In the new trial, romosozumab significantly reduced the incidence of new vertebral fractures through 24 months as well as non-vertebral fractures in postmenopausal women with osteoporosis at high risk for fracture compared with Merck & Co.’s Fosomax.

However, serious heart problems were reported in 2.5% of patients who received the Amgen drug, versus 1.9% in the Fosomax group. That doesn’t sound like much except it means there’s a 32% higher incidence of heart problems with Evenity versus Fosomax.

Steve’s Take:

Just when Amgen thought its bone drug was headed for the seats after a sterling performance in three previous efficacy trials for osteoporosis, heart safety worries turned what looked like a home run into perhaps just a long out. (Pardon the baseball analogy but our squad here in long-suffering San Diego ranks 29th out of 30 major league teams in batting, so any hit is appreciated.)

Steve's Take: @Amgen thought its bone drug was a home run, but wound up a long out Click To Tweet

Amgen’s Arch trial was assumed to be a pro forma exercise ahead of osteoporosis drug romosozumab’s July PDUFA decision–an event many viewed as a rubber stamp. Instead, the study that was supposed to bolster the drug’s credentials in non-vertebral fracture and improve its commercial prospects has proved its downfall, Seeking Alpha points out. Serious cardiovascular side effects were observed in the romosozumab arm, leading the FDA to demand more safety data.

This now leaves romosozumab, or Evenity, at best facing a severely delayed approval with numerous safety warnings on a very restricted label, or at worst being scrubbed entirely. The drug was expected to exceed Thomson Reuters’ forecast and have sales of $917 million in 2022, according to consensus forecasts from EvaluatePharma.

Remember that all along, Evenity was expected to contribute at least something to the company’s top line this year. So this isn’t great news for Amgen. But with $22.6 billion forecast for sales in 2017, it doesn’t fundamentally alter its flight path. The same can’t be said for its partner UCB, with just $4.3 billion predicted in 2017.

It’s true Amgen could use a new approval, Max Nisen points out for Bloomberg. It is trying to rely more on newer medicines and less on best-selling older products such as Enbrel, Neulasta, and Neupogen, all of which are set to decline.

But delaying or losing about $500 million in projected Evenity sales in 2021 won’t doom Amgen’s entire future. Not by a long shot. Its migraine drug candidate erenumab and cholesterol medicine Repatha are far more important for its future. And with $38 billion in cash and equivalents on its books and a reputation for cost management, Nisen says, “Amgen should be OK even if this is the end of the line for Evenity.”

The same can’t be said for Amgen’s Belgian partner which has less than a fifth of Amgen’s revenue. This is the only Phase 3 drug in UCB’s research pipeline; its other R&D efforts are in Phase 2 trials or earlier and likely won’t hit the market for years. Its leading drugs currently on the market are expected to start declining in the early 2020s, just as it hoped Evenity would stoke sales.

Meanwhile, the clear beneficiary of all this is Radius Health, a biotech that got an FDA approval for its own osteoporosis drug Tymlos less than a month ago. That drug has a far easier path to success, now that it may not face Amgen’s medicine this year, or possibly ever. Analysts estimated 2017 sales of about $43 million, a virtual bonanza for this previously sales-free company.

Still, Motley Fool cautions investors that competition from generic formulations of Forteo could weigh on the launch and ultimate success of Radius’s Tymlos.

Amgen and its partners at UCB didn’t ignore the situation in its announcement, after accentuating the positive:

“We are impressed with the statistically significant superior fracture risk reduction of EVENITY over alendronate, a current standard of care in osteoporosis. When we think that patients who have had a fracture are highly likely to suffer another one, the importance of post-fracture care cannot be emphasized enough,” said Iris Loew-Friedrich, UCB’s chief medical officer. “We are working on understanding the observed cardiovascular safety signal and will continue to discuss these results with global regulators and experts in the field.”

Bottom Line:

No matter how big the happy face the companies’ PR people try to paste on the announcement, this is a bummer of a development for Amgen. And possibly a backbreaker for much smaller UCB. The California biopharma giant has had a series of nasty issues, including a big backlash by payers targeting its PCSK9 drug, and could have used some truly good news.

The osteoporosis market may have lost a key piece of competition. While that could be bad news for patients and drug pricing advocates, the potential arrival of generics and, soon, Radius Health’s Tymlos, promise to increase the number of options available to those at risk of serious and even life-threatening bone fractures.

Watching Evenity almost, but not quite, make it into the outfield seats is deflating for the companies, to say the least. It also doesn’t sit well with their investors, analysts and the rest of their fans.