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Is AbbVie's Promising Cancer Drug Doomed?

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Sometimes when a company wins the research and development lottery by getting its hands on a molecule with game-changing potential, it can do more harm than good. Expectations can soar early in the process, perhaps unrealistically, and doom a company to failure. Unfortunately for AbbVie (NYSE: ABBV  ) , it can't seem to shake the trend for a promising new class of leukemia therapies. Will these molecules ever leave the pipeline? There are several reasons to be optimistic -- as long as you can take an equal dose of pessimism.

Lightning strikes twice
Years ago, AbbVie was developing a novel drug named ABT-263 for treating chronic lymphocytic leukemia, or CLL. The cancer causes bone marrow to produce large amounts of abnormal lymphocytes -- a type of white blood cell -- that can weaken immune response and even exclude healthy cells and platelets from circulating in the bloodstream.

The drug worked by inhibiting BCL-2, a group of proteins that naturally initiate cell death, and showed promising results in a phase 1 study with 90% of patients showing reduced levels of abnormal lymphocytes. Unfortunately, the drug also significantly reduced healthy platelet counts in several patients because of its inability to distinguish between BCL-2 target proteins. AbbVie is still evaluating ABT-263, but it has enjoyed its fair share of setbacks.   

The drug was not a complete failure though. The company took what it learned about BCL-2 inhibition to develop ABT-199, its current best solution for CLL, which is expected to spare platelet production. Just when hopes were the highest, the promising new drug being developed with Roche (NASDAQOTH: RHHBY  )  hit a snag of its own.

Trials suspended after patient deaths
The love story ended shortly after Valentine's Day when reports surfaced that two patients being treated with ABT-199 had died, causing the company to suspend the five clinical trials evaluating the drug. The two patients died from tumor lysis syndrome, which occurs when tumors break up too quickly and overload the kidneys and liver with dead cells. In other words, you can view this as a sign that the drug works too well, too quickly.

AbbVie is re-examining dosing regimens for each trial and fully expects the trials to succeed and proceed in development this year. Investors looking for a product lineup less dependent on Humira -- which was responsible for $9.265 billion, or 51% of AbbVie's 2012 sales -- certainly hope so.    

Pipeline to success?
Not only is AbbVie dependent on Humira for half of its revenue, but four of the other seven major drugs sold by the company saw negative year-over-year growth in 2012. The good news is that Humira has a big lead over competing therapies in rheumatoid arthritis, such as Remicade from Johnson & Johnson (NYSE: JNJ  ) and Enbrel from Amgen (NASDAQ: AMGN  ) . The bad news is that next generation biologic therapies -- and even a new class of small molecules -- are trying to put their predecessors out of business. It is this perfect storm of pressure that breeds such high expectations for ABT-199 from analysts and investors. 

Foolish bottom line
While it is entirely possible that AbbVie and the FDA can find reasons to advance ABT-199, loss of life is never looked upon lightly. I am no oncologist, but it appears that the company may be able to adjust the dose or monitor lymphocyte counts in patients more closely to catch early signs that treatment should be suspended. Regardless, it is simply too early to factor the drug into your investment decisions. The importance of the therapy to AbbVie's pipeline should not be understated, but I think it is best to take a "wait and see" approach. 

In the pharma business, great success comes with a caveat. AbbVie is a perfect example, as investors in the new company are left wondering what the future holds once the company's golden goose, Humira, is cooked. Is ABT-199 really the answer? The Fool's brand new premium report on the company answers the high-profile questions that AbbVie investors are asking, and as an added bonus, you'll receive a full year of free analyst updates as significant news hits. Simply click here now to claim your copy today.


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