What Pharma Investors Need to Know About Pfizer's Latest Disaster




  • In Business
  • 2019-02-22 02:39:00Z
  • By Cory Renauer, The Motley Fool
 

Pfizer (NYSE: PFE) recently shared some unfortunate news related to its blockbuster anti-inflammation drug, Xeljanz. A safety problem for this popular tablet could open doors for similar treatments that AbbVie (NYSE: ABBV) and Gilead Sciences (NASDAQ: GILD) are shepherding through late-stage development right now, or it could spell trouble for the entire class of drugs.

Xeljanz isn't the only drug of its class associated with lethal blood clots, and there's a chance the Food and Drug Administration could try to hinder AbbVie and Gilead Sciences from launching another one. Here's how Pfizer's latest problem could shake out for everyone involved.

Image source: Getty Images.

What happened

Two years after Xeljanz earned approval to treat rheumatoid arthritis (RA), Pfizer began a safety study with 4,400 RA patients to look for safety differences between older injections like Humira and two Xeljanz doses currently in use for the treatment of ulcerative colitis. The trial is still running, but the data safety monitors noticed a statistically important difference in the occurrence of blood clots that caused a pulmonary embolism among patients given 10 mg twice daily, compared to those treated with Humira.

Data monitors also reported a higher rate of overall mortality among patients given 10 mg twice daily, compared to patients given 5 mg twice daily or Humira. In response, Pfizer will transition all the patients in the 10 mg group to the 5 mg cohort and hope for the best.

Reasons to relax

It's important to note that all the RA patients in Pfizer's post-marketing study were over 50 years old and at risk of a cardiovascular event. Also, the 10 mg twice-daily dosage is only used to treat ulcerative colitis. In 2016, Pfizer launched an 11 mg extended-release version of Xeljanz that patients with RA take once a day, and 5 mg instant-release tablets twice daily are still an option. If Pfizer ends up removing the 10 mg twice-daily dosage from the market, most patients who use it won't even notice.

Last year, Eli Lilly (NYSE: LLY) became the second company to launch a Janus kinase (JAK) inhibitor for RA, called Olumiant. Potentially lethal blood clots were reported by five patients out of 997 given the dosage widely considered effective for treating RA. In response, the FDA only approved a half-dose last year, and it isn't gaining much traction against Xeljanz.

The FDA recently started reviewing an application for another JAK inhibitor from AbbVie: Upadacitinib could receive an approval decision for RA by the end of the third quarter. And Gilead Sciences isn't far behind with the safest member of its class to date; Gilead's filgotinib is the only JAK inhibitor in development that hasn't been associated with lethal blood clots during clinical trials with RA patients.

Image source: Getty Images.

Reasons to be nervous

Xeljanz earned approval to treat ulcerative colitis less than a year ago, and these patients are supposed to take 10 mg twice daily for at least eight weeks. If Pfizer has to pull this dosage from the market before it can launch an extended-release option for ulcerative colitis patients, gaining a large share of this space could become even more difficult.

In decades past, the FDA learned the hard way that one patient death in a thousand is far too many for long-term therapies meant to treat large groups. Don't be surprised if the agency requires Xeljanz and Olumiant to complete additional post-marketing studies, and puts upadacitinib and filgotinib under a microscope.

Who will step up?

The future for JAK inhibitors is still hazy, but their efficacy rates are similar enough to make one important prediction: The treatment with the safest prescribing label will outperform its peers.

Xeljanz already has a black box on its label to let prescribing physicians know that some patients treated with it have developed lymphoma and other cancers. Adding another warning about potentially fatal blood clots won't make selling Xeljanz any easier.

Eli Lilly's Olumiant reminds physicians about cases of lymphoma and lethal blood clots that occurred during clinical trials, and so far sales of the drug have been fairly disappointing.

Image source: Getty Images.

What to look for

Pharma investors should keep an eye on the FDA's treatment of AbbVie's JAK inhibitor. Cases of deadly blood clots were reported among patients receiving upadacitinib during the studies that support its application. Unlike with Olumiant and more recently Xeljanz, though, blood clots in patients on upadacitinib occurred at a rate in line with those given a placebo, and much lower than in those given Humira. The FDA will almost certainly assemble a panel of independent experts to pore through the safety data, and if they don't like what they see, upadacitinib's sales team could struggle with black-box warnings as well.

Right now it looks like Gilead's JAK inhibitor is the only one that hasn't been associated with blood clots or malignancies, but we're still waiting for some pivotal trial data. If filgotinib's safety profile remains unbesmirched, the last member of this drug class to reach the FDA will probably overtake all its peers in the commercial setting.

Cory Renauer owns shares of Gilead Sciences. The Motley Fool owns shares of and recommends Gilead Sciences. The Motley Fool has a disclosure policy.

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