Celgene branched out from its blood cancer roots earlier this year when it won an FDA nod for an oral arthritis drug called apremilast (Otezla). But the Summit, NJ-based company's plan to turn that drug into a franchise took a hit on Wednesday after it failed a late-stage trial for a form of arthritis affecting the spine.
Celgene (NASDAQ:CELG) said today that apremilast failed a Phase 3 study in what's known as ankylosing spondylitis, a painful form of arthritis that causes inflammation of the vertebrae. Apremilast didn't improve patients' symptoms in a statistically significant way—Celgene's goal had been to significantly reduce patients' symptoms by 20 percent after 16 weeks, compared to a placebo. Celgene released only top-line results from the study today. It'll provide more details from the trial at a future medical meeting.
The news is a setback for Celgene, albeit not necessarily an unexpected one—shares of Celgene were down only 1.6 percent in pre-market trading on Thursday, and RBC Capital Markets analyst Michael Yee wrote in a note earlier this month that investors "appear[ed] to have low expectations" for the trial.
Celgene is best known for its blood cancer drugs like thalidomide, but has been pushing the development of an inflammation and immunology franchise, with apremilast—an oral drug that works by inhibiting the enzyme phosphodiesterase 4—as its anchor. Celgene won FDA approval of apremilast in psoriatic arthritis in March, and viewed it as a stepping stone to prove the drug could be effective at treating several other inflammatory disorders that are commonly treated with injectable biologics. Ankylosing spondylitis was one of its shots at expanding the franchise, along with psoriasis. The FDA could approve apremilast in psoriasis later this year.
While today's study failed, Celgene says it hasn't given up hope in ankylosing spondylitis. The company is pointing to efficacy it's seen in a "large" subset of patients with early stage disease after 24 weeks of treatment with apremilast, and said it will collect MRI data on a subgroup of patients after 52 weeks of treatment. It'll also perform radiographs on all patients in the study after 104 weeks. Celgene might start another Phase 3 trial after it collects more data.
"Ankylosing spondylitis is a chronic, debilitating disease, and despite advances over the last 15 years, there remains significant unmet need for a safe, effective, oral therapy—especially for patients early in the progression of their disease," said Scott Smith, Celgene's head of inflammation and immunology.
Celgene and Wall Street, meanwhile, haven't seen eye to eye on apremilast's potential. Celgene has said it expects the drug to bring in between $1.5 billion and $2 billion in sales in 2017. By comparison, in a recent report, EP Vantage estimated about $1.2 billion in sales in 2018. Consensus analyst estimates have the drug bringing in $130 million this year.
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