Watch stocks you care about
The single, easiest way to keep track of all the stocks that matter...
Your own personalized stock watchlist!
It's a 100% FREE Motley Fool service...
Eight months ago, Bayer and Johnson & Johnson (NYSE: JNJ ) announced that the Food and Drug Administration had issued a complete response letter for their anticoagulant, Xarelto. This week, the duo got another one. And back in 2009, the companies got a complete response letter for Xarelto for a different indication.
This isn't one of those gifts that are fun to receive once, let alone multiple times. While it goes by an ambiguous name, a "complete response letter" is essentially a rejection letter. It's issued when the review is complete, but there are issues keeping the drug from being approved.
The FDA rejection last year came as a result of missing data from the clinical trial that Bayer and Johnson & Johnson were using to expand the use of Xarelto to treat patients with acute coronary syndrome. A whopping 63% of the patients had not followed through with the trial.
The companies tracked down most of the patients to figure out whether they were still alive, and submitted follow up data showing that deaths of the missing patients were equally distributed between the three treatment groups -- two drug dosages and one placebo -- suggesting that the mortality benefit was maintained.
Bayer and Johnson & Johnson didn't go into specifics as to what current concerns the FDA has with approving Xarelto for acute coronary syndrome. It could still be with the missing data, but my best guess is that the agency is worried about the increase in bleeding seen in patients taking Xarelto. The bleeding didn't kill more patients, but it's still a complication that has to be taken seriously. Eli Lilly's (NYSE: LLY ) Effient and AstraZeneca's (NYSE: AZN ) Brilinta have the same bleeding issue in acute coronary syndrome patients, but the drugs were able to get approved by the FDA.
Xarelto is in the same class of drugs -- Factor X inhibitors -- as Bristol-Myers Squibb (NYSE: BMY ) and Pfizer's (NYSE: PFE ) Eliquis and Boehringer Ingelheim's Pradaxa. The drugs can be used to treat a variety of cardiovascular issues, such as preventing and treating blood clots, and in patients with an irregular heart beat called atrial fibrillation. Xarelto is approved for those indications, but Eliquis has superior data for atrial fibrillation and is likely to capture most of those patients. Acute coronary syndrome was supposed to be where Xarelto could fit in, because it's the only Factor X inhibitor that's shown a reduction in heart attacks.
Unless the FDA turns its gift of coal into a real gift, those sales don't look like they'll be forthcoming.
Is bigger really better?
Involved in everything from baby powder to cardiovascular drugs, Johnson & Johnson's critics are convinced that the company is spread way too thin. If you want to know if J&J is nothing but a bloated corporate whale -- or a well-diversified giant that's perfect for your portfolio -- check out the Fool's new premium report outlining the Johnson & Johnson story in terms that any investor can understand. Claim your copy by clicking here now.