Novartis Strengthens in Oncology With Multiple Myeloma

Big pharma player Novartis (NYSE: NVS  ) continues to prove the success of its R&D strategy as competitor after competitor joins the great restructuring and slashing of R&D budgets.

A major player in oncology, Novartis hit its primary endpoint of halting multiple myeloma progression with its agent LBH589 in phase 3 studies. In this trial, a combination of LBH589, dexamethasone (a steroid) and bortezomib (an proteasome inhibitor) beat the current therapy of just dexamethasone and bortezomib in stopping cancer progression.

Secondary endpoints looked at overall survival and response rate as well as response and safety. While the company already has that data, it will be released at the American Society of Hematology conference.

LBH589 is among a class of drugs known as "pan-DAC inhibitors," which work by blocking enzymes key to cancer cell replication, allowing those cells to die while sparing the body's noncancerous cells. Rival companies Celgene (NASDAQ: CELG  ) , Acetylon Pharmaceutricals and MorphoSys (NASDAQOTH: MPSYF  ) have also been developing drugs in the same class.

Celgene, however, has been playing a different strategy than Novartis' emphasis on R&D. Known as a major dealmarker in pharma, it recently struck a $3.3 billion deal with OncoMed (NASDAQ: OMED  ) and continued its deals with biotech start-ups, including a $818 million partnership with MorphoSys on multiple myeloma agent MOR202 and a $35 million deal with PharmAkea on cancer and fibrosis drugs, among others.

Celgene is already one of the world's major multiple myeloma pharmaceutical companies, touting its newly approved Pomalyst, Thalomid, and the growing $1.09 billion grossing Revlimid. It also recently invested the $100 million option fee for exclusive rights to buy Acetylon Pharmaceuticals and with it, Acetylon's drug ACY-1215, which works in combination with Celgene's own multiple myeloma agents.

Novartis has been doing well in its oncology department, with 10 drugs in the pipeline expected to launch by 2017 and three agents, including non-small-cell lung cancer treatment LDK378, earning breakthrough therapy designation that will fast track them through the approval process.

Novartis' LEE011, a CDK4/6 inhibitor of cancer, also starts phase 3 trials this month, much to the dismay of Pfizer (NYSE: PFE  ) , which was leading potential blockbuster drug class with breast cancer therapeutic palbociclib, currently in late-stage studies. Both companies are looking at the drugs as treatment for ER-positive, Her2-negative breast cancers for an estimated $1-$5 billion in annual sales .

Bottom line
Novartis may be holding out on restructuring like the rest of big pharma, but its strong oncology pipeline is certainly justifying CEO Joe Jimenez's move. Besides sneaking up on Pfizer's CDK4/6 blockbuster last month with its own LEE011, Novartis is now pushing on Celgene's turf in multiple myeloma. Nonetheless, while rivals like Celgene work gutsy deals and acquisitions to expand, Novartis' strength is unique in its actual in-house development, a feature that is quickly fleeting in the rest of big pharma. The oncology division will likely attain many of the 10 approvals it is hoping for by 2017, with LBH589 likely one of the earlier candidates. Based on its pipeline, Novartis should be a strong long-term investment for shareholders as those approvals start to kick out.

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