PropThink: Sizing Up Elagolix - A Blockbuster Drug
(Thomson Reuters ONE) -
By Jason Napodano, CFA
In June 2012, Abbott Labs (NYSE:ABT) initiated a phase III clinical trial with
elagolix to evaluate the safety and efficacy of the drug in female patients with
endometriosis. Below we provide some detail on what endometriosis is, how
elagolix works, why we are confident in the design of the phase III trial, and
just how big a market opportunity this represents.
About Endometriosis
Endometriosis is a gynecological medical disorder that occurs when cells from
the lining of the uterus (endometrium) grow in other areas of the body, most
commonly on the peritoneum which lines the abdominal cavity, the ovaries, bowel,
rectum, and bladder. These endometrial tissue implants are influenced by
hormonal changes and respond similarly to the cells found inside the uterus,
only they are not shed during menstruation. Instead, they may grow and shrink
with hormonal changes, bleed irregularly, and lead to severe cramping or pelvic
pain. Endometriosis is a common issue in women with infertility.
The cause of endometriosis is unknown. One theory is that the shed endometrial
cells during menstruation travel backwards through the fallopian tubes into the
pelvis, where they implant and grow. This is called retrograde menstruation.
This backward menstrual flow occurs in many women, but researchers think the
immune system may be different in women with endometriosis. As such, genetic
predisposition plays a role in the development of endometriosis, with about
a 10-fold increased incidence in women with an affected first-degree relative.
Endometriosis can affect any female, from premenarche to post-menopause;
however, it is primarily a disease of the reproductive years. Accordingly,
endometriosis is typically diagnosed between the ages of 25 and 35, although
researchers believe the condition probably begins about the time that regular
menstruation begins. Its prevalence varies, but sources suggest up to 10% of the
general reproductive-age female population is affected. Nearly 25% of women with
endometriosis are asymptomatic.
As noted above, infertility is common with endometriosis. About 25 to 50% of
infertile women have endometriosis, and 30 to 50% of women with endometriosis
are infertile (source). Endometriosis is an estrogen-dependent process, and can
persist beyond menopause and in up to 40% of patients following
hysterectomy. Approximately 400,000 hysterectomies per year are attributed to
endometriosis (source).
For additional information on endometriosis, we recommend this detailed medical
report.
Elagolix
Elagolix is a novel, oral gonadotropin-releasing hormone (GnRH) antagonist
developed by Neurocrine Biosciences (NASDAQ:NBIX). Neurocrine licensed the
worldwide rights to elagolix to Abbott Labs in June 2010 (press release) and
received $75 million upfront from the pharmaceutical giant. Since June 2010,
Neurocrine has earned an additional $30 million in milestones and $23 million in
sponsored R&D payments. Neurocrine has the potential to earn up to an additional
$427 million in regulatory and development payments and $50 million in
commercial payments, along with royalties on sales.
GnRH is a peptide that stimulates the secretion of the pituitary hormones that
are responsible for sex steroid production and normal reproductive function.
Researchers have found that chronic administration of GnRH agonists, after
initial stimulation, reversibly shuts down this transmitter pathway and is
clinically useful in treating hormone-dependent diseases such as endometriosis.
Several companies have developed peptide GnRH agonists on this principle, such
as Lupron (Abbott) and Zoladex (AstraZeneca [NYSE:AZN]).
However, since these drugs are peptides, they must be injected via a depot
formulation rather than the preferred oral route of administration. In addition,
GnRH agonists can take up to several weeks to exert their desired effect once
the initial stimulation has occurred, a factor not seen with the use of
Neurocrine's GnRH antagonists. More importantly, until the desired effects are
maximized, GnRH agonists have shown a tendency to exacerbate the condition via a
hormonal flare. And ultimately, profound suppression of GnRH is similar to that
seen after menopause and can be associated with hot flashes and the loss of bone
mineral density.
Neurocrine's orally active, non-peptide GnRH antagonists potentially offer
several advantages over injectable GnRH peptide drugs, including rapid onset of
hormone suppression without a hormonal flare. Also, injection site reactions
commonly observed in peptide depots are avoided and dosing can be rapidly
discontinued if necessary - a clinical management option not available with
long-acting depot injections. Importantly, with elagolix it may be possible to
alter the level of pituitary GnRH suppression, thereby titrating circulating
estrogen levels. Using this approach, an oral GnRH antagonist may provide
patients relief from the painful symptoms of endometriosis while avoiding the
need for the active management of bone loss.
In summary, we see the following advantages to elagolix over existing
medications such as Lupron, Zoladex, or depot formulation contraceptives such as
medroxy-progesterone (Depo Provera):
1. Orally active. Elagolix is given as a once-daily oral tablet, avoiding
injection-site reaction seen with depo formulations. Elagolix can be dose-
titrated and quickly discontinued if necessary.
2. Reversible. Because elagolix can be quickly discontinued, ovulation returns
typically after the first month of cessation of therapy. Women receiving
long-acting formulations of Lupron and Depo Provera can take months to see
normal return to ovulation.
3. Rapid effect. Elagolix does not cause the initial GnRH flare effect seen
with agonists (drugs that simulate GnRH which the body then shuts down via
feed back loop), which can worsen symptoms near-term and take weeks or even
months before they reduce symptoms.
4. Less side-effects. The mechanism of action of a GnRH antagonist
(GnRH suppression seems to have a benign affect on changes in bone mineral
density and hot flash as elagolix does not suppress estradiol levels to the
effect of Lupron).
The Phase III Trial
The phase III trial, called Violet Petal (ClinicalTrial.gov
identifier: NCT01620528), is a 24-week, multinational, randomized, double-blind,
placebo-controlled study designed to evaluate the safety and efficacy of
elagolix in 875 women, age 18 to 49, with moderate-to-severe endometriosis-
associated pain. It will be conducted at approximately 160 sites in the United
States, Puerto Rico and Canada. As of the end of October 2012, Abbott reports
being on track with respect to patient recruitment and enrollment.
The primary endpoint will be a dual-endpoint in reduction in dysmenorrhea
(painful menstruation) and non-menstrual pelvic pain (NMPP) for women on two
doses of elagolix (150 mg and a yet unannounced higher dose) vs. placebo in a
1-1-2 randomization over 6 months. Efficacy will be assessed by a responder
analysis for statistical evaluation. The inclusion of a higher dose of elagolix,
perhaps 250 mg or 300 mg (150 mg BID) is intriguing. It allows for a potential
full label with dose titration and prescribing options post approval.
Confident In Design
We are confident in the design of the phase III trial, and the efficacy and
safety previously seen with elagolix. In total, Neurocrine has presented data
from 12 phase I programs and 6 phase II programs (2 phase IIa and 4 phase IIb)
on roughly 1,000 patients. Results from the phase IIb (n=137) Daisy Petal
(Study-901) program first released in May 2010 provide the best proof-of-concept
data for the phase III trial initiated in June 2012. Results were statistically
significant in all primary and secondary endpoints.
We are also encouraged by the fact that during the phase IIb Daisy Petal program
elagolix demonstrated excellent safety and tolerability. Discontinuation due to
adverse events was low at 4.4% for elagolix vs. 1.4% for the placebo during the
first eight weeks of the program. The discontinuation rate increased to only
5.1% at week 24. The most common adverse event reported more often with elagolix
than with placebo was nausea (~10% of the subjects). This was consistent with
what we saw in previous clinical studies. Importantly, there were no elagolix
treatment-related serious adverse events.
Responder analysis from the phase IIb trial showed an 85% response rate with
150 mg elagolix. We believe Abbott is looking for greater than 90% response rate
in the phase III trial through the inclusion of a higher dose. Secondary
endpoints include dyspareunia (painful intercourse) and patient global
impression of change (PGIC), as well as analgesic use. Following the 6 month
controlled portion of the trial, patients will enroll in a 6 month open-label
extension study where Abbott will look for signs of persistent efficacy. For the
safety analysis, patients will be followed for an additional 12 months, after
which Abbott will conduct a DXA scan to assess changes in bone mineral density.
We expect that this program will take 12 months to enroll. Top-line data from
the phase III trial should be available in the first half of 2014, with the full
analysis in 2015. Abbott plans to conduct a second confirmatory phase III trial
mirroring the first trial expected to start in early 2013. We expect that this
program will include sites outside North America, with an emphasis on Western
Europe. Full analysis from the second trial is expected in 2016, along with the
New Drug Application (NDA) planned for 2016.
Market Opportunity
Abbott Labs is an excellent partner for Neurocrine Bio. Abbott is a pioneer and
market leader in GnRH agonists with Lupron for the treatment of hormone-
responsive cancers such as prostate cancer or breast cancer. Abbott has a strong
appreciation for the GnRH mechanism and the company is clearly committed to
making elagolix a success with Lupron expected to lose patent protection in
2015. We believe that Abbott will look to replace Lupron in the Ob/Gyn market
with elagolix thanks to superior efficacy and tolerability, as well as patent
protection.
Above we noted sources that site the prevalence of endometriosis at around 10%
of the general female population between the ages of 18 and 49. This is roughly
10 million women in the U.S. However, we also note that nearly 25% of these
women are asymptomatic. Our findings are consistent with research done by
Datamonitor in 2009 citing 7.5 million women in the U.S. alone are believed to
suffer from clinically significant endometriosis.
Neurocrine notes that 75% of endometriosis sufferers have symptoms defined as
moderate or severe. Data from IMS Health suggests that 10-20% of all oral
contraceptive prescriptions are written off-label for endometriosis, and
that Ob/Gyn's prescribe NSAIDs and opioids off-label to approximately 25% of
their endometriosis patients.
The question is, what percent of moderate to severe endometriosis patients are
adequately treated by NSAIDs, oral contraceptives, and opioids? Above, we noted
that approximately 400,000 hysterectomies per year are attributed to
endometriosis. We suspect that another 350-400,000 women are to the point that
they are failing these other medications and nearing a hysterectomy (essentially
pulling forward one year all the women that are heading towards a hysterectomy
next year). As such, we believe there are approximately 800,000 women in the
U.S. that are ideal potential candidates for elagolix. We think it is realistic
for Abbott to penetrate 50% of this market.
We believe that elagolix will launch competitively priced with branded
neurological or fibromyalgia pain medications such as Cymbalta or Lyrica, at
around $7 per day. We believe a typical course of treatment will be 7 to 8
months on therapy. Elagolix' intellectual property is protected by a composition
of matter patent through 2024. We suspect that Abbott will file additional
applications and extensions (through Hatch-Waxman) that could protect the drug
to 2029. We suspect that elagolix pricing can peak at $9 to $10 per day by 2025.
Multiplying all this through, we arrive at a peak U.S. opportunity for elagolix
in endometriosis of $800 million (800k patients x 50% penetration x $9.50 per
day x 210 days).
For the purpose of this article we focused solely on endometriosis. However, we
remind investors that Abbott is also studying elagolix in a phase IIa
exploratory trial for the treatment of uterine fibroids. In September 2011,
Abbott announced it had commenced this program, expected to enroll up to 325
women with heavy uterine bleeding associated with uterine fibroids at clinical
sites around the U.S. for a total of 3 months. The doses for the trial have not
been disclosed, but Neurocrine describes them as a broad range with previous
work done in phase I program. We expect the trial to take about twelve months to
complete, meaning we should see data over the summer of 2013. The primary
endpoint will be quantified blood loss assessed by alkaline hematin.
We think this is an important step forward for Abbott and Neurocrine because
development of elagolix outside the U.S. will probably focus on uterine
fibroids. The opportunity in uterine fibroids may be as large as in
endometriosis. As such, globally, we think elagolix is a blockbuster drug, with
peak sales that could approach $1.5 billion if the drug works in both
endometriosis and uterine fibroids. One blockbuster drug may not move the needle
meaningfully for Abbott Labs, but for Neurocrine Bio it could be a potential
game-changer.
Read this article in its original format by clicking here.
About PropThink
PropThink is an intelligence service that delivers long and short trading ideas
to investors in the healthcare and life sciences sectors. Our focus is on
identifying and analyzing technically-complicated companies and equities that
are grossly over or under-valued. We offer daily market coverage, weekly feature
stories, and a newsletter to investors who subscribe on PropThink.com. To learn
more, follow us on Twitter or visit us at http://www.propthink.com.
Disclaimer:
You should assume that as of the publication date of any report or letter,
PropThink, LLC and persons or entities with whom it has relation ships
(collectively referred to as "PropThink") has a position in all stocks (and/or
options of the stock) covered herein that is consistent with the position set
forth in our research report. Following publication of any report or
letter, PropThink intends to continue transacting in the securities covered
herein, and we may be long, short, or neutral at any time hereafter regardless
of our initial recommendation. To the best of our knowledge and belief, all
information contained herein is accurate and reliable, and has been obtained
from public sources we believe to be accurate and reliable, and not from company
insiders or persons who have a relationship with company insiders. PropThink was
not compensated to publish this article. Our full disclaimer is available
at http://www.propthink.com/disclaimer.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: PropThink via Thomson Reuters ONE
[HUG#1654476]
Unternehmensinformation / Kurzprofil:
Datum: 01.11.2012 - 16:13 Uhr
Sprache: Deutsch
News-ID 198783
Anzahl Zeichen: 17292
contact information:
Town:
New York
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 215 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"PropThink: Sizing Up Elagolix - A Blockbuster Drug"
steht unter der journalistisch-redaktionellen Verantwortung von
PropThink (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
