2nd UPDATE: FDA Delays Decision On Amgen Bone Drug
20 October 2009 - 5:57AM
Dow Jones News
The Food and Drug Administration delayed its approval decision
on Amgen Inc.'s (AMGN) osteoporosis treatment denosumab - a drug
considered crucial to the biotech - because the agency seeks more
information from the company.
The Thousand Oaks, Calif., drug maker is seen able to answer the
FDA's questions by year end, although ultimate approval may not
occur until mid-2010. Denosumab is still widely expected to be
approved by FDA, but the delay postpones the drug getting to
market, limiting potential revenue in 2010, and may slow Amgen's
plans to seek the drug's approval for a separate and more lucrative
indication.
An Amgen spokesman declined to offer specifics, citing the
ongoing regulatory process, but said the company expects to respond
"quickly" and in the "near term."
"It is not uncommon for the FDA to have requests for additional
information," he said. Many on Wall Street had expected such a
delay for the drug because regulators have a history of missing
deadlines and may want more time to analyze the safety record of a
new drug like denosumab.
Amgen shares recently fell 1.3% to $60.50.
Eric Schmidt, an analyst with Cowen & Co., believes that
denosumab's approval is likely in mid-2010. He continues to project
2010 denosumab sales of $200 million in osteoporosis, but said that
the Wall Street consensus estimate of about $500 million will
likely have to be reduced.
Despite the delay, Schmidt is recommending that clients buy
shares of Amgen before its third-quarter earnings report Wednesday,
as he expects the company's core business will outshine any delay
from denosumab.
Amgen, which had 2008 revenue of $15 billion, already sells five
products with sales exceeding $1 billion.
Some analysts, including Lazard Capital Markets' Joel Sendek,
project a shorter delay and see denosumab getting approval in early
2010. Sendek projects 2010 sales of $439 million, rising to $1.2
billion in 2011.
A key component of 2010 sales is how long the FDA take in its
review. Under a Class 1 resubmission, which involves minor changes,
clarifying information and updates, the cycle is generally 60 days.
A Class 2 resubmission is more cumbersome, including more clinical
information and items needing a review by an advisory committee,
resulting in a six-month review. The classification is determined
by the FDA after resubmission.
In the complete response letter, the agency requested several
items including information on a post-market surveillance plan,
Amgen said.
The FDA isn't requiring any additional clinical trials before
completing its review, but it did request a new clinical program to
support approval for preventing postmenopausal osteoporosis. The
FDA has also requested updated safety data related to denosumab,
which has the proposed brand name of Prolia.
That updated information will include data from two large
studies of denosumab's usefulness in preventing complications from
cancer's spread to bone, a second and possibly more lucrative
indication for the drug. Those studies became available over the
summer.
Amgen hasn't disclosed its regulatory filing plans for
preventing cancer-related skeletal complications, but a third study
is coming early next year and many expect approval in late
2010.
Depending on the outcome of that third trial, Deutsche Bank
projects peak global sales between $1.4 billion and $2.1 billion in
preventing skeletal complications in cancer.
The FDA is requiring a Risk Evaluation and Mitigation Strategy,
including a medication guide, a communication plan and a timetable
for submission of assessments of the plans. Amgen has already
submitted materials for such a program, but it is unclear if the
agency has questions.
JPMorgan analyst Geoffrey Meacham, in a note to clients, said
such requirements aren't onerous as compared to a patient registry,
which could have restricted usage of the drug and hurt sales.
-By Thomas Gryta, Dow Jones Newswires; 212-416-2169;
thomas.gryta@dowjones.com