I was disappointed to see Lilly's (NYSE: LLY) announcement a few days ago that its Alzheimers drug semagacestat was not good enough to continue trials.
Disappointed ... but not surprised.
The pharmaceutical industry's record with drug candidates for Alzheimers is miserable. Only Namenda (from Forest Labs (NYSE: FRX) and Aricept (Pfizer (NYSE: PFE) and Eisai) do much good at all, and even those really only address symptoms for a relatively brief window of time.
A whole host of companies, though, have tried and failed to develop a drug - the roster includes Glaxo (NYSE: GSK), AstraZeneca (NYSE: AZN), Johnson & Johnson (NYSE: JNJ), Abbott Labs (NYSE: ABT), Pfizer, and Neurocrine (Nasdaq: NBIX). That is a partial list from my memory, and I absolutely guarantee that there are many more names that I could add to it if I did a quick Google search.
Why this rotten track record? Well, for starters, nobody really knows exactly what happens as part of AD. Sure, amyloid plaques seem to be involved somehow, but nobody really has proven definitively if they are a symptom or causative agent. Likewise, the action and involvement of tau proteins seems significant, but there is no established pathology of the disease.
What that all means is that drug developers do not have a clear target. Imagine if somebody handed you a bow and arrow, pointed to a dense patch of forest, said "there's a small rabbit in there somewhere ... get me a bullseye". If you managed to so much as wing the critter, it would be basically blind luck - and I am going to argue that the existence of Namenda and Aricept is basically just a product of blind luck (try enough compounds and something might work).
Now, companies have developed successful drugs in the past without fully understanding the underlying mechanisms (Lunacept, for instance), but clearly that has not worked so well for AD.
Unfortunately, more disappointment is likely. Pfizer and JNJ have bapineuzumab in late studies, but the data on improved mental function has not been supportive. Likewise, Elan (NYSE: ELN) is pushing on with ELND005 even though the interim analysis was not positive. All of these, including LLY's other late-stage AD drug, solanezumab, target lowering amyloid levels and it just does not seem like that is a credible approach for great success.
What about targeting tau? This seems a little more encouraging. Tau protein seems to be involved in forming neurofibrillary tangles and animal models of tau inhibition seem to show positive results. Bristol Myers (NYSE: BMY) has a drug developed along these lines. Likewise, TauRX's Rember is a tau-targeting hsp70 inhibitor that appears to help mental function ... though it does require high doses. Early-stage Oligomerix is also trying to develop a drug that targets tau proteins, but they are very early in development.
Outside of this is Baxter (NYSE: BAX) and its Gammagard product. This has shown some cognitive improvement in Phase 2 studies, as well as less swelling of the brain - an encouraging enough sign to continue, but not really indicative of a major blockbuster cure.
I certainly do not mean to bash any companies working on AD drugs. It is a terrible disease and I really do hope somebody finds a compound that can halt or reverse its effects. That said, I think the idea of casting around blindly for compounds that may work and hanging on to apparently disproven notions (like that reducing amyloid helps much) is not helping anybody.
For investors, just remember to be skeptical. If you find a pharmaceutical or biotech with a truly novel approach to AD, maybe it is worth a shot in your portfolio, but I would advise a lot of skepticism when it comes this space as a whole. Until scientists figure out the "how", I just do not have much confidence that Big Pharma will figure out the "what".
Showing posts with label Glaxo. Show all posts
Showing posts with label Glaxo. Show all posts
Wednesday, August 18, 2010
Wednesday, July 14, 2010
Avandia Gets A Reprieve?
Apparently the expert panel commissioned by the FDA to evaluate GlaxoSmithKline's (NYSE: GSK) now-controversial diabetes drug Avandia has voted to recommend that the drug stay on the market. The vote, 20-12, is not binding and although the FDA usually does as its panels recommend, they do not always do so - particularly in cases of safety concerns.
As a brief background, Avandia (also known as rosiglitazone), is a gamma PPAR diabetes drug that makes cells more responsive to insulin. Although it is quite effective (reducing HbA1C by 0.5% or more, a nearly 10% improvement in this important diabetes diagnostic marker), some studies have indicated it carries a much higher risk of heart attack and death from cardiac problems than other gamma PPARs or other anti-diabetes drugs in general. The issue has grown with time, precipitating this FDA meeting.
Although Avandia may be allowed to stay on the market, its glory days are almost certainly over. Actos, a rival PPAR drug marketed by Takeda does not seem to have the same risks. Moreover, this whole class has been a sort of pharmaceutical Bermuda Triangle - AstraZeneca, Bristol Myers Squibb, and Daiichi Sankyo have all had serious issues with PPAR drugs they tried to develop, and relatively few compounds are in clinical studies now.
Moreover, there are plenty of other fish in the sea - including GLP-1 analogs (Amylin, Lilly, Roche, Novo Nordisk, and Glaxo) and DPP-4 inhibitors (Merck) on the market or in late development. Plus, very old drugs like metformin are still reasonably effective and have positive risk-benefit trade-offs.
I am a little surprised to see this result, but as I said, I do not think it will matter too much. Even if the FDA allows the drug to stay on the market, Glaxo is going to have a helluva time driving prescription growth. In the meantime, I have a vested interest here in hoping that Amylin's long-acting GLP-1 analog Bydureon steals the show.
Disclosure - I own shares of Amylin
Brief update: Of the 20 who voted NOT to remove Avandia, 10 want sells restricted and stronger warning labels, 7 want stronger labels but no new restrictions, and three recommended no changes. This breakdown makes me think that further restrictions (at a minimum) are a near-certainty and total withdrawal could still happen.
As a brief background, Avandia (also known as rosiglitazone), is a gamma PPAR diabetes drug that makes cells more responsive to insulin. Although it is quite effective (reducing HbA1C by 0.5% or more, a nearly 10% improvement in this important diabetes diagnostic marker), some studies have indicated it carries a much higher risk of heart attack and death from cardiac problems than other gamma PPARs or other anti-diabetes drugs in general. The issue has grown with time, precipitating this FDA meeting.
Although Avandia may be allowed to stay on the market, its glory days are almost certainly over. Actos, a rival PPAR drug marketed by Takeda does not seem to have the same risks. Moreover, this whole class has been a sort of pharmaceutical Bermuda Triangle - AstraZeneca, Bristol Myers Squibb, and Daiichi Sankyo have all had serious issues with PPAR drugs they tried to develop, and relatively few compounds are in clinical studies now.
Moreover, there are plenty of other fish in the sea - including GLP-1 analogs (Amylin, Lilly, Roche, Novo Nordisk, and Glaxo) and DPP-4 inhibitors (Merck) on the market or in late development. Plus, very old drugs like metformin are still reasonably effective and have positive risk-benefit trade-offs.
I am a little surprised to see this result, but as I said, I do not think it will matter too much. Even if the FDA allows the drug to stay on the market, Glaxo is going to have a helluva time driving prescription growth. In the meantime, I have a vested interest here in hoping that Amylin's long-acting GLP-1 analog Bydureon steals the show.
Disclosure - I own shares of Amylin
Brief update: Of the 20 who voted NOT to remove Avandia, 10 want sells restricted and stronger warning labels, 7 want stronger labels but no new restrictions, and three recommended no changes. This breakdown makes me think that further restrictions (at a minimum) are a near-certainty and total withdrawal could still happen.
Thursday, July 8, 2010
Random Rant - Where Will We Get Our Next Blockbuster?
I never intended this blog, or my writing, to be so heavy on medical technology but I suppose we all end up writing the most about whatever it is we think most about and understand best. As part of this, I'm starting to worry about where the U.S. is going to be in 10 or 20 years with our biological science infrastructure.
The starting point for this was reading Merck's announcement today that they were firing a large number of workers and closing manufacturing facilities and research facilities. Over the past few years, virtually all of the major pharmaceutical firms have fired scientists and researchers, including Pfizer, AstraZeneca, J&J, Novartis, and GlaxoSmithKline. On top of that, the stock, private equity, and venture capital markets have been so weak that biotechs cannot get the funding to start up or expand their research (and absorb those scientists).
Where do these researchers go? Academia is not much of a backstop. Although Obama's stimulus plan did give a significant boost to NIH funding (the NIH funds an enormous amount of university-level biology research), that funding had been in decline for years and looks poised to fall sharply once the stimulus runs out. Moreover, considering the budget issues of tomorrow that are being written by the spending of today, I don't see the financial flexibility to really spend more in the future.
Even if there were a lot of money available, it would not necessarily help all that much. Academic research is often very highly specialized and focused more on figuring things out for their own sake. If you ask most academic researchers how their work will directly benefit mankind, you might get a puzzled stare or a rude "harrumph" about the inherent value of knowledge for its own sake (or a spiel about how biological research is a large mosaic/tapestry woven together by hundreds of independent discoveries).
And I'm fine with that. It's not academia's job to develop preclinical compounds. Moreover, there is a lot of value to pursuing knowledge for its own sake - oftentimes, some of the most important discoveries are made when a scientist simply digs in to "figure something out" as opposed to looking for a targeted solution to a particular problem. After all, penicillin and pacliataxel were "happy accidents" that stand in sharp contrast to the inability to find cures for ailments like malaria and HIV/AIDS.
Right now, at least some of those academics are flowing into CROs and maybe that's the ultimate destiny of biological research outside of academia. More and more, Big Pharma is shaping itself as a marketing enterprise and looking to get out of the businesses of manufacturing and R&D. That's fine; it's worked pretty well for Forest Labs.
All in all, though, I'm worried about where this could leave the U.S. science infrastructure in a decade or two. I don't think it's a coincidence that U.S. electronics firms cut back on their engineering and R&D and ultimately found themselves getting lapped by the Japanese, Koreans, and now Chinese. While the U.S. still has plenty of high-quality electronics engineers (in fields like semiconductors, especially), I would still maintain that there has been something of a "brain drain" that has translated into the U.S. no longer being the default leader in bringing new technologies and concepts to the market.
A lot of work goes into getting a PhD in biological sciences, and these people are not stupid. If they see their career prospects (and the prestige of their potential profession) increasingly devalued, they are going to do something else. Once that happens, once talented people abandon science because they don't see a fair return on the efforts involved, we're going to be in a bad situation.
Right now, the U.S. is hands-down the leader in biological science. Let's hope we don't see a repeat of what has happened to our electronics sector.
Disclosure - I own shares of JNJ
The starting point for this was reading Merck's announcement today that they were firing a large number of workers and closing manufacturing facilities and research facilities. Over the past few years, virtually all of the major pharmaceutical firms have fired scientists and researchers, including Pfizer, AstraZeneca, J&J, Novartis, and GlaxoSmithKline. On top of that, the stock, private equity, and venture capital markets have been so weak that biotechs cannot get the funding to start up or expand their research (and absorb those scientists).
Where do these researchers go? Academia is not much of a backstop. Although Obama's stimulus plan did give a significant boost to NIH funding (the NIH funds an enormous amount of university-level biology research), that funding had been in decline for years and looks poised to fall sharply once the stimulus runs out. Moreover, considering the budget issues of tomorrow that are being written by the spending of today, I don't see the financial flexibility to really spend more in the future.
Even if there were a lot of money available, it would not necessarily help all that much. Academic research is often very highly specialized and focused more on figuring things out for their own sake. If you ask most academic researchers how their work will directly benefit mankind, you might get a puzzled stare or a rude "harrumph" about the inherent value of knowledge for its own sake (or a spiel about how biological research is a large mosaic/tapestry woven together by hundreds of independent discoveries).
And I'm fine with that. It's not academia's job to develop preclinical compounds. Moreover, there is a lot of value to pursuing knowledge for its own sake - oftentimes, some of the most important discoveries are made when a scientist simply digs in to "figure something out" as opposed to looking for a targeted solution to a particular problem. After all, penicillin and pacliataxel were "happy accidents" that stand in sharp contrast to the inability to find cures for ailments like malaria and HIV/AIDS.
Right now, at least some of those academics are flowing into CROs and maybe that's the ultimate destiny of biological research outside of academia. More and more, Big Pharma is shaping itself as a marketing enterprise and looking to get out of the businesses of manufacturing and R&D. That's fine; it's worked pretty well for Forest Labs.
All in all, though, I'm worried about where this could leave the U.S. science infrastructure in a decade or two. I don't think it's a coincidence that U.S. electronics firms cut back on their engineering and R&D and ultimately found themselves getting lapped by the Japanese, Koreans, and now Chinese. While the U.S. still has plenty of high-quality electronics engineers (in fields like semiconductors, especially), I would still maintain that there has been something of a "brain drain" that has translated into the U.S. no longer being the default leader in bringing new technologies and concepts to the market.
A lot of work goes into getting a PhD in biological sciences, and these people are not stupid. If they see their career prospects (and the prestige of their potential profession) increasingly devalued, they are going to do something else. Once that happens, once talented people abandon science because they don't see a fair return on the efforts involved, we're going to be in a bad situation.
Right now, the U.S. is hands-down the leader in biological science. Let's hope we don't see a repeat of what has happened to our electronics sector.
Disclosure - I own shares of JNJ
Wednesday, July 7, 2010
Cancer Vaccines Continue To Show Promise
I have to applaud the patience and diligence of the folks running Dendreon (Nasdaq:DNDN). After years of setbacks and complications (including three Phase 3 studies), the company and its investors finally saw the big payoff as the FDA approved the first-ever cancer vaccine - Provenge.
With Provenge now on the market, and the squabbling and speculating about reimbursement fully underway, the question moves to who might be next to advance a cancer vaccine to the market. Is this really a major new avenue of oncology, or is it a small access road along the bigger highway of traditional drugs?
For the complete column, please go to:
http://stocks.investopedia.
With Provenge now on the market, and the squabbling and speculating about reimbursement fully underway, the question moves to who might be next to advance a cancer vaccine to the market. Is this really a major new avenue of oncology, or is it a small access road along the bigger highway of traditional drugs?
For the complete column, please go to:
http://stocks.investopedia.
Wednesday, June 30, 2010
What Ails Amgen?
Biotech giant Amgen (Nasdaq:AMGN) may not be considered a pharmaceutical company yet, but the market is certainly treating it like one. Whether you consider the P/E ratio, the price-book, price-cash flow, or EV/EBITDA ratios, Amgen trades more or less in line with the likes of Pfizer (NYSE:PFE), Lilly (NYSE:LLY) and GlaxoSmithKline (NYSE:GSK) than Celgene (Nasdaq:CELG) or Genzyme (Nasdaq:GENZ).
This would be all well and good if Amgen was just another typical big-cap pharmaceutical company. Though Amgen does have some issues in common, I think the differences are more significant than the similarities. Most significantly, it looks as though the market is assuming that Amgen is going to grow at a pace similar to most of these large companies (which is to say, "not much"), and this is where the stock could ultimately outperform.
The full article can be read at:
http://stocks.investopedia.
This would be all well and good if Amgen was just another typical big-cap pharmaceutical company. Though Amgen does have some issues in common, I think the differences are more significant than the similarities. Most significantly, it looks as though the market is assuming that Amgen is going to grow at a pace similar to most of these large companies (which is to say, "not much"), and this is where the stock could ultimately outperform.
The full article can be read at:
http://stocks.investopedia.
Tuesday, June 22, 2010
Another Partnership For Alnylam
One of my favorite biotechs (and one that I own), Alnylam Pharmaceuticals (Nasdaq: ALNY), announced yet another partnership tied to its microRNA/RNAi technology.
Tuesday morning, Alnylam announced that Sanofi-Aventis (NYSE: SNY) had formed a research and development partnership with Regulus Therapeutics. Regulus is a 50/50 joint venture between Alnylam and antisense pioneer Isis Pharmaceuticals (Nasdaq: ISIS). As part of the three-year deal, Sanofi is sending a $25 million initial payment to Regulus, and Sanofi will pay for all of the R&D during the deal. Sanofi also has the option to extend the deal for an additional two years, and could send as much as $750 million to the partnership if various development milestones are met (that's a BIG if, and predicated on multiple clinical successes for multiple compounds). The deal may also include a $10M equity investment in Regulus if the parties can agree to a price.
The deal will initially cover the potential use of microRNA for the treatment of fibroids (four different targets), but could expand even further.
Now, partnerships are nothing new for Alnylam (nor Regulus, as there's also a deal in place with Glaxo). The company already had lucrative deals with the likes of Roche, Novartis, and Takeda. That Big Pharma validation is certainly part of why Alnylam is considered the leader in RNAi, and the company has an impressive amount of IP to back up its promise (over 300 patents to date).
This isn't the time or the post where I'm going to go into detail on why I like Alnylam. But I will say this is one of the most interesting biotechs I've seen in a long, long time and while there is nothing like a "sure thing" in biotech, I'm actually allowing myself to get a little excited about the potential of this one. Then again, I once thought the same thing about Isis and although I profited from my ownership in those shares, that never worked out as I had hoped.
Disclosure: I own shares of Alnylam
Tuesday morning, Alnylam announced that Sanofi-Aventis (NYSE: SNY) had formed a research and development partnership with Regulus Therapeutics. Regulus is a 50/50 joint venture between Alnylam and antisense pioneer Isis Pharmaceuticals (Nasdaq: ISIS). As part of the three-year deal, Sanofi is sending a $25 million initial payment to Regulus, and Sanofi will pay for all of the R&D during the deal. Sanofi also has the option to extend the deal for an additional two years, and could send as much as $750 million to the partnership if various development milestones are met (that's a BIG if, and predicated on multiple clinical successes for multiple compounds). The deal may also include a $10M equity investment in Regulus if the parties can agree to a price.
The deal will initially cover the potential use of microRNA for the treatment of fibroids (four different targets), but could expand even further.
Now, partnerships are nothing new for Alnylam (nor Regulus, as there's also a deal in place with Glaxo). The company already had lucrative deals with the likes of Roche, Novartis, and Takeda. That Big Pharma validation is certainly part of why Alnylam is considered the leader in RNAi, and the company has an impressive amount of IP to back up its promise (over 300 patents to date).
This isn't the time or the post where I'm going to go into detail on why I like Alnylam. But I will say this is one of the most interesting biotechs I've seen in a long, long time and while there is nothing like a "sure thing" in biotech, I'm actually allowing myself to get a little excited about the potential of this one. Then again, I once thought the same thing about Isis and although I profited from my ownership in those shares, that never worked out as I had hoped.
Disclosure: I own shares of Alnylam
Can Investors Fatten Up On Weight Loss?
I would like to make one addition (or rather, an extended explanation) to part of this article. In it, I discuss Arena's lorcaserin and mention its somewhat dicey legacy. What I did not have time to adequately mention in the original is that there is a significant biochemical difference between lorcaserin and its predecessor fenfluramine. Fenfluramine caused serious cardiac side-effects because of its effects on type 2b and 2c receptors. Lorcaserin is active only with the 2c receptors and does not cause the same side-effects.
That said, investors would be mistaken to believe that many (or even "most") physicians will do the perfunctory research necessary to understand that distinction. Consequently, there is a real risk of "guilt by mis-association". If Arena can get a strong marketing partner, one that can spend the time educating docs, it won't be a problem. But if Arena has to go it alone, they may be hampered in their efforts to really get docs to understand the difference and use the drug.
You cannot read a majorU.S.
Diet, Exercise and SupportIn terms of non-medical intervention, there are two clear leaders in theU.S.
For the full column:
http://stocks.investopedia.
That said, investors would be mistaken to believe that many (or even "most") physicians will do the perfunctory research necessary to understand that distinction. Consequently, there is a real risk of "guilt by mis-association". If Arena can get a strong marketing partner, one that can spend the time educating docs, it won't be a problem. But if Arena has to go it alone, they may be hampered in their efforts to really get docs to understand the difference and use the drug.
You cannot read a major
Diet, Exercise and SupportIn terms of non-medical intervention, there are two clear leaders in the
For the full column:
http://stocks.investopedia.
Tuesday, June 15, 2010
The Future Of Stem Cells
There has been no shortage of hype regarding the possible therapeutic uses of stem cells. To date, though, there has been a lot more hope than clinical results, no doubt in part to research restrictions imposed by the prior U.S.
That does not mean, however, that stem cells may not have a major role in medicine and drug development long before then. One of the more interesting concepts in development right now concerns the use of stem cells in the drug design, validation and testing process. If successful, stem cells could significantly alter the preclinical drug development process and lead companies to more successful clinical trials and more productive drug development.
The full article can be read at:
http://stocks.investopedia.
That does not mean, however, that stem cells may not have a major role in medicine and drug development long before then. One of the more interesting concepts in development right now concerns the use of stem cells in the drug design, validation and testing process. If successful, stem cells could significantly alter the preclinical drug development process and lead companies to more successful clinical trials and more productive drug development.
The full article can be read at:
http://stocks.investopedia.
Friday, April 30, 2010
GlaxoSmithKline On Simmer
The last of the run for today (I think...):
http://stocks.investopedia.com/stock-analysis/2010/GlaxoSmithKline-On-Simmer-GSK-LLY-PFE-ABT-NVS0430.aspx
http://stocks.investopedia.com/stock-analysis/2010/GlaxoSmithKline-On-Simmer-GSK-LLY-PFE-ABT-NVS0430.aspx
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