Medivation Inc. and Astellas Up the Ante against Johnson & Johnson

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Thanks to data announced in October, investors already knew Medivation  (NASDAQ: MDVN  )  and Astellas Pharma's phase 3 trial showed their prostate cancer drug Xtandi was impressive in treating patients who hadn't yet received chemotherapy.

Now, with fresh data in hand, we can see just how compelling the argument is for the FDA to approve the company's bid to expand Xtandi's label to include that all important pre-chemotherapy indication. If the FDA does agree to expand Xtandi's use, it could erase a competitive advantage currently held by Johnson & Johnson's (NYSE: JNJ  )  blockbuster prostate cancer treatment Zytiga.

Label expansion
The chance to market Xtandi to the pre-chemo patient pool could mean a significant bump up in revenue for both Medivation and its partner Astellas. Xtandi is currently Medivation's only marketed drug; after Johnson & Johnson's Zytiga got the nod for pre-chemotherapy use in December 2012, it kicked off a surge in sales that helped Zytiga's revenue jump more than 60% to $750 million in the U.S. during 2013.

Despite Xtandi being compared to placebo during phase 3 while Zytiga was compared to prednisone, a steroid commonly prescribed as part of prostate cancer therapy, results suggest Xtandi put up results as good as, and possibly even better than, Zytiga in this patient pool. Following the release of additional trial data this month, it's hard to believe the FDA won't eventually grant Xtandi the go-ahead. Especially, when considered in the context of the data behind the FDA approving Zytiga for the indication.

Patients taking Xtandi not only saw overall survival improve, but were also able to delay chemotherapy treatment by 17 months versus placebo. In pre-chemotherapy phase 3 trials for Zytiga, patients were able to delay chemotherapy by 8.4 months versus prednisone.

Xtandi patients, who had all previously failed on androgen deprivation therapy, saw their risk of death drop 29% versus placebo and their risk of radiographic progression, or rPFS, or death fall 81% when compared to the placebo group. In Zytiga's trial, the risk of death dropped 25% and the rPFS fell 57% versus prednisone.

Looking at it another way, those patients taking Xtandi reported a delay in deterioration in quality of life of 11.3 months, versus 5.6 months for placebo, a 5.7 month improvement. Patients taking Zytiga saw the time to deterioration improve to 12.7 months from 8.3 months for those taking only prednisone, a 4.4 month improvement.

Fool-worthy final thoughts
Metastatic castration-resistant prostate cancer causes 258,000 deaths worldwide each year, so the need for new, more effective treatment remains.

Since each was compared against a different control during clinical trials, it's tough to make an apples-to-apples comparison of Xtandi and Zytiga. However, compelling results for Xtandi means it's likely we'll see an sNDA filed for the indication soon and an eventual FDA approval. If so, Xtandi will likely cut into sales that otherwise would've headed to Zytiga. A dynamic that may already be playing out in off-label use given Zytiga's U.S. sales have been slowing sequentially while Xtandi's have been growing.

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Todd Campbell

Todd has been helping buy side portfolio managers as an independent researcher for over a decade. In 2003, Todd founded E.B. Capital Markets, LLC, a research firm providing action oriented ideas to professional investors. Todd has provided insight to a variety of publications, including SmartMoney, Barron's, and CNN/fn.

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