Better Than Lipitor! Higher Sales?

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Sales of Pfizer's (NYSE: PFE  ) Lipitor topped out at more than $10 billion before the drug finally lost patent protection. The next generation of cholesterol-lowering drugs are on their way, and it's clear they can improve on the effects of Lipitor and the other statins such as AstraZeneca's (NYSE: AZN  ) Crestor and Merck's (NYSE: MRK  ) Zocor, but that doesn't necessarily mean they'll reach the same sales levels.

Rare but important
Aegerion Pharmaceuticals 
(NASDAQ: AEGR  ) gained Food and Drug Administration approval last week for Juxtapid, its treatment for homozygous familial hypercholesterolemia. Patients with the disease have mutations in both copies of a gene responsible for removing cholesterol from the blood stream.

While rare, homozygous familial hypercholesterolemia is an extremely serious disease where young patients have insanely high levels of cholesterol, which leads to premature cardiovascular issues and an early death.

Sanofi (NYSE: SNY  ) and Isis Pharmaceuticals (NASDAQ: IONS  ) are also developing a drug to treat homozygous familial hypercholesterolemia, Kynamro, which is currently under FDA review. The EU's Committee for Medicinal Products for Human Use recently rejected  the drug, but the FDA's advisory committee gave it a positive recommendation -- albeit a little muted -- so there's still hope that it could be approved stateside.

Having one mutated copy of the disease, called heterozygous, is far more common. Patients aren't nearly as sick, but still have unhealthy levels of cholesterol that is often not controlled by the current medications. Both Juxtapid and Kynamro have safety issues that might keep them from getting approved to treat heterozygous patients.

The masses
A new generation of drugs are targeting protein convertase subtilisin/kexin type 9, or PCSK9, which promotes the degradation of receptors that remove bad LDL cholesterol from the bloodstream. Inhibiting PCSK9 increases the receptors, thereby decreasing the level of cholesterol.

So far, the data looks pretty promising. Regeneron Pharmaceuticals (NASDAQ: REGN  ) and Sanofi are developing REGN727, which Sanofi calls SAR236553, reduced LDL cholesterol by 28.9% to 67.9% at different doses compared with a 10.7% reduction in patients receiving placebo. Amgen's (NASDAQ: AMGN  )  AMG 145 produced similarly striking results, reducing LDL levels by 66% in one trial and 51% in another.

Alnylam Pharmaceuticals  (NASDAQ: ALNY  ) is also targeting PCSK9, but its drug, ALN-PCS, reduces the protein's function through RNAi, which degrades the RNA before it can be used to produce the protein. Regneron and Amgen's drugs inhibit the PCSK9 protein directly by binding an antibody to it.

Is lower cholesterol really better?
Or maybe the better question is: Can you prove it?

Drugs that treat homozygous familial hypercholesterolemia can get away with just showing that they reduce cholesterol levels to prove their worth. For drugs given to the masses, the Food and Drug Administration will want to see more than the results of a laboratory test. The agency requires drugmakers show the drugs reduce the level of heart attacks, strokes, and the like before they can be approved.

The problem for new drugs is that statins and healthier living has already reduced negative heart outcomes substantially. Proving that a drug can reduce them further has proven difficult. And it's unethical to run a trial that tests a drug against placebo unless you allow all patients to also be on a statin if they need it.

Merck, for instance tried to prove that its cholesterol and lipid drug, Cordaptive, combined with a statin could reduce negative outcomes compared to a statin alone, but the trial failed. Does the drug really not work? My guess is that it probably does; it increases good HDL cholesterol, reduces bad LDL cholesterol, and reduces lipid level after all. But proving that it reduces an already low level of negative events isn't easy.

Good investment?
I think going after heart drugs for the masses is probably not the wisest investment. I see the appeal -- $10 billion annually is an awfully big number -- but it costs an awful lot to run these large outcomes trials and to prove that a drug works, the trials might need to be even larger. And if the change is really that small, I'm not sure insurance companies are going to be willing to pay for it.

Homozygous familial hypercholesterolemia is an appealing alternative. There's money to be made in treating orphan diseases because drugmakers can charge so much; Juxtapid will reportedly cost between $200,000 and $300,000 per year. But they're not going to be a megablockbuster and perhaps not even a blockbuster at all if the market is split among multiple drugs.

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  • Report this Comment On January 01, 2013, at 2:03 PM, prginww wrote:

    Happy New Year Brian. I have a problem with your article and I hope you will address it. A great article includes an additional small heading "Conclusion". An even better article includes all companies that are FDA approved that have better results related to anything in the article.

    First. I would like to see a follow up from you that gives the reader your firm belief of AEGR's Future. Like probable sales first year, second year and so on. Projected stock valuations and head to head comparisons of other "Specialty" drugs that are equivalent.

    Second, in the beginning of your article, I do not understand the purpose of comparing this apple to all the seemingly oranges other than SNY and ISIS. Do any of these other companies specifically do exactly the same thing that AEGR does? You mention a group in the first part of your article where one company made over 10 billion dollars during the lifetime of the patent. These products cover very high cholesterol of >500 only. You do not explain why they are included. You do mention that AEGR covers a "Specialty" disease, but you do not mention the the FDA states it has a potential extremely severe side effect for the liver and has a box warning attached by the FDA. You then mention that they may have competition from SNY and ISIS pending their approval. Your readers may have wanted to know that ISIS has a PDUFA date this month on the 29th.

    Your article then flips back to the beginning and lists new companies which are not specialty drugs like AEGR that belong to the first paragraph, which all should be under the heading "Masses". You indicate that this new group is in Phase trials without any mention of what Phase they are in. If I am not mistaken, they all lower cholesterol of >500 only. Definitely this applies to the first group that the FDA approved and are going off patent. This is the purpose of your 10 billion dollar statement of PFE's drug Lipitor that have about one billion dollars per year in sales.

    Your comments proceed to question the benefits of lowering bad cholesterol, but fails to mention these drugs also lower good cholesterol. Also, you state the unfair comparisons of without or with statins. The Mötley Fool has covered one of the "Masses" group quite a lot that you have not included. AMRN. It already has FDA approval for >500 and is submitting a sNDA for >200 to <500 group by the end of February. No other company has a drug on the market that can do this. Amarin's drug Vascepa also RAISES GOOD cholesterol. The statin issue is also being studied by AMRN at the request by the FDA. The fact that the FDA requested it is important. These results will be completed be end 2014. It's hard to believe you omitted this information. So this should cover the oranges part of the article. Now the second part of your article, the apples. What is your conclusion about AEGR? Forget the masses and analyze the potential sales with the box warning. Does the stock price appear over extended and by how much? How many sales will be covered by insurance companies? If SNY and ISIS is obtains approval, what will this cut AEGR sales by or is one companies product better than the other? Why not take what you have here and write what you should have, two articles? I'm not trying to slam you Brian. Im just asking for more valuable information if you have it. I'm a Fool that wants you to write what I'm asking for. Two articles, so that I can make more sense of both. I am considering on buying more at this price level of the "Masses" stock AMRN. I also own "Specialty" AEGR and I would appreciate more information as I'm starting to see that maybe this stock is not as good as I thought since I saw the box warning and potential competition. I am noticing option Puts have increased the last two trading days. Is it related to the box warning, SNY/ISIS or both? A new article from you, someone from The Mötley Fool or my fellow Fools would be appreciated. As always, this is the place to go to obtain more solid information than any other to add to DD. Thank you.

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