Pfizer Faces Firing Line

Tomorrow, a panel of outside experts will decide the fate of Pfizer's (NYSE: PFE  ) new kidney cancer drug, Inlyta. Reading the briefing documents is much like looking at a 60-year-old who just got Botox. The top line looks good, but the details are what really matter.

Pfizer's Inlyta outperformed Onyx Pharmaceuticals (Nasdaq: ONXX  ) and Bayer's Nexavar in patients who had already failed an initial treatment. But the two-month increase in progression-free survival -- from 4.7 months on Nexavar to 6.7 months on Inlyta -- was primarily driven by patients who had taken cytokines first. When looking at patients who took Pfizer's Sutent as a first-line treatment, Inlyta only provided a 1.4-month-increase in progression-free survival, a measurement of how long it takes for the tumor to start growing again.

Since Sutent is the primary first-line treatment for patients in the U.S., the FDA is concerned that most patients might get the less-impressive result. The outside experts will end up spending a lot of time on this one issue and whether the smaller benefit justifies the risks of the drug.

I'm not sure how big of an issue this really is; the agency has seen these subset issues before. It didn't put any restrictions on Human Genome Sciences (Nasdaq: HGSI  ) and GlaxoSmithKline's (NYSE: GSK  ) Benlysta despite its apparent ineffectiveness in African Americans. The FDA did require the companies to run a postmarketing study to tease out whether the signal is real.

That seems fair. If the agency is going to argue -- rightfully in my opinion -- that subgroup analysis can't be used to support marketing applications, why should it be used to reject them?

While the results might not keep Inlyta off the market, they could limit its use. Doctors who use Sutent first might not bother with Inlyta, given the data. Adding to the marketing worries, AVEO Pharmaceuticals (Nasdaq: AVEO  ) has a kidney cancer drug coming up behind Inlyta.

Pfizer investors won't have to wait too long to find out whether the FDA takes the advisory panel's advice and whether doctors will actually prescribe Inlyta; the PDUFA date for Pfizer's drug is March 13.