A tepid recommendation from an expert advisory panel could limit the sales of new cholesterol drugs, but they could still become $1 billion products in the near term, and generate as much as $15 billion five years from now.
Last night, Praluent, an experimental cholesterol drug from Regeneron and Sanofi , received a lukewarm endorsement from a panel of expert advisors to the Food and Drug Administration. That would seem to be bad news for Sanofi and Regeneron, and also for rival Amgen AMGN +0.55%, whose own, similar cholesterol drug, Repatha, will go in front of the same committee today.
Both companies were hoping to sell the drugs to patients who can’t tolerate the statin drugs that are currently the mainstays of cholesterol treatment. But only 7 of the 16 panelists supported approving the drugs for statin intolerant patients, fearing that doing so would lead patients to abandon the statins, which have been proven to prevent heart attacks and strokes.
But Richard Evans, a veteran industry analyst at Sovereign & Sector, says that he still expects the products to be huge. Before the drugs, known as PCSK9 inhibitors, have been proven to prevent heart attacks and strokes, he still sees U.S. sales potential of more than $2 billion. If large studies prove the drugs have a benefit, he thinks sales of PCSK9 inhibitors will be between $9.6 billion and $15 billion a year. Those studies are due to complete in 2017 or 2018.
Evans ran some math on the committee’s recommendations, using data from the National Health and Nutritional Examination Survey (NHANES). . There are 3.9 million Americans who: have a high risk of cardiovascular disease, are on a statin, and still have an LDL (bad cholesterol) of more than 100 milligrams per deciliter. Assuming that 25%-33% of these patients will be prescribe a PCSK9 and 60% of those will stick with it, Evans assumes 1.2 million to 1.6 million prescriptions of the drug annually. Moreover, he assumes that 10% of the 6.8 million Americans who are at high risk, take a statin, and have LDL’s above 70 mg/dL but below 100 mg/dL will be prescribed a PCSK9, and 60% will stick with it.
In total, that leads him to between 6.1 million to 6.5 million prescriptions for PCSK9 drugs. At a $340 per month price, this translates into $2.1 billion in sales. But they could be even higher if it turns out insurers really can’t prevent statin intolerant patients from getting the medicines. Evans notes that health insurers and pharmacy benefit managers may try to prevent statin intolerant patients from getting PCSK9s by insisting they take them with statins. But most statins are cheap generics, and patients could just throw out their pills and take their PCSK9 shots, he argues. Optum, the pharmacy benefit arm of UnitedHealth Group, has the best chance os making such restrictions stick. The other big benefit managers, CVS Caremark and Express Scripts, would have more trouble. ” I think alot of statin intolerant patients would slip through,” he argues.
Still, the panel vote is cause for concern among Wall Street analysts who expected a clearer path to big sales. “ A narrower label would dent forecasts, however, and the overhang will undermine the stock near term,” wrote Geoffrey Porges at Bernstein Research in a note to investors. Robyn Karnauskas, of Deutsche Bank, pointed out that the FDA doesn’t always follow the recommendations of its advisory panels exactly, and might be more lenient than the experts were. Amgen’s Repatha goes before the same panel today.
By Matthew Herper
