UPDATE: Gilead's Letairis Gets Safety Upgrade From FDA
March 04 2011 - 4:06PM
Dow Jones News
Gilead Sciences Inc. (GILD) said the U.S. Food and Drug
Administration has allowed the removal of a warning about liver
injury from the label of Letairis, a treatment for a rare lung
disease, something that may give the drug a competitive boost.
The agency's rare removal of the risk language--from the
so-called black box warning--is the result of a multiyear effort by
the Foster City, Calif., drug maker to provide data that would get
the label changed. The drug is used to treat pulmonary arterial
hypertension and, unlike its main competition, patients who use it
will no longer be required to obtain monthly liver function
tests.
Shares of Gilead, which is known for its antiviral and HIV
treatment, recently rose 52 cents, or 1.3%, to $40.51. ISI Group
analyst Mark Schoenebaum estimated that the label change may be
worth $2 a share to Gilead's stock.
Letairis sales grew 31% to $240.3 million last year, compared to
Gilead's total revenue of $7.95 billion for the year. The drug
primarily competes with Swiss drug maker Actelion Ltd.'s (ATLN.VX)
Tracleer, which generated sales of CHF1.64 billion, or about $1.77
billion.
United Therapeutics Corp. (UTHR) and Pfizer Inc. (PFE) also make
treatments of the condition, while a number of companies are also
developing new treatments.
Pulmonary arterial hypertension, a condition involving
continuous high-blood pressure in the arteries that carry blood
from the heart to the lungs. The prognosis for patients is poor,
with about 50% of people diagnosed dying within five years,
according to the American Lung Association. Incidence remains low,
with it affecting between 1 in 100,000 to 1 in 1 million
people.
Tracleer was approved by the FDA in 2001 and continues to
include warnings about liver damage and requires monthly testing.
Both drugs continue to include strong warnings about the risk of
birth defects.
"I think this now really tips the balance," said Kevin Young,
Gilead's Executive Vice President of Commercial Operations.
Officials from Actelion weren't immediately available for
comment.
Young said the company will immediately begin educating its
sales force of 60 people about the change. He estimated that 150
clinical centers treat most patients with the disease and the
company sales team will be able to cover them in the next week.
Gilead acquired Letairis in 2006 with its $2.5 billion takeover
of Myogen Inc. The drug was approved by the FDA in 2007, but Young
said the drug's label was surprisingly "onerous."
"This update should finally give Letairis the leg up [Gilead]
envisioned when it acquired the product four years ago," Robert
Baird analyst Thomas Russo said.
Both Letairis and Tracleer are in a class of drugs called
endothelin receptor antagonists, or ERAs, which work by relaxing
blood vessels. Between the two drugs, Gilead's Young said the
company currently has a 35% market share in the U.S.
Young said any increase in sales would likely take "some time"
as the new opportunity is in new patients because physicians are
unlikely to switch patients from their current therapy.
Oppenheimer & Co. analyst Bret Holley projected 2014 sales
of Letairis of $450 million. He expects that market share gains
against Tracleer could be "somewhat of a struggle" because of
Actelion long-standing market presence and physician
experience.
-By Thomas Gryta, Dow Jones Newswires; 212-416-2169;
thomas.gryta@dowjones.com
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