The only thing more exciting than a binary event for a drugmaker is one that could result in $1 billion or more in sales, the threshold for being called a blockbuster. We asked our team of healthcare experts to name a drug that's up for approval that could produce a billion or more in sales. Read on to see why Todd, Dan, and Brian like the prospects for Regeneron Pharmaceuticals (NASDAQ:REGN) and Sanofi's (NASDAQ:SNY) Praluent, Novartis' (NYSE:NVS) LCZ696, and Vertex Pharmaceuticals' (NASDAQ:VRTX) lumacaftor and ivacaftor combination.
Todd Campbell: One of the most anticipated PDUFA dates this year has to be July 24, because that's when the FDA is set to make its decision on Regeneron Pharmaceuticals and Sanofi's Praluent. Praluent is the first of two PCSK9 inhibitors that the FDA will give a green or red light to this year. The other is Amgen's (NASDAQ: AMGN) Repatha, which the FDA will issue a decision for on August 27.
If approved, Praluent will give doctors a new weapon they can use alongside statins to lower stubbornly high cholesterol levels in patients. During clinical trials, patients who took Praluent and statins saw their LDL cholesterol drop by an additional 62% at week 24 versus a placebo group only on statins, and by an additional 56% at week 78.
Although Praluent would first be used in the toughest-to-treat cases of high cholesterol, industry watchers believe that their use could expand to a much broader patient population. Statins are among the most widely-prescribed medications in America, and pharmacy benefit manager Express Scripts estimates that as many as 71 million Americans suffer from high cholesterol levels. With pricing expected to be as much as $10,000 per year, it's a pretty good bet that an approval in July will lead to Praluent becoming a billion dollar blockbuster drug for Sanofi and Regeneron someday.
Dan Caplinger: Swiss drug company Novartis has a potential blockbuster in LCZ696, its experimental treatment for chronic heart failure. The treatment, which combines antihypertensive drugs valsartan and sacubitril, has forecasters excited about its future, with a recent report from Thomson Reuters pegging its potential annual sales to top the $1 billion mark by 2017 and reach more than $3.7 billion by 2019.
In February, Novartis announced that it received priority review designation from the FDA, meaning that the time that the FDA will spend looking at the company's filing would be reduced from 12 months to eight months. As a result, Novartis could get a decision on approval by August. Europe's Committee for Medicinal Products for Human Use has also granted an accelerated assessment status to LCZ696.
Novartis has high hopes for LCZ696, with its PARADIGM-HF study showing that the drug significantly reduced the risk of cardiovascular death or heart-failure hospitalization compared to Merck's (NYSE: MRK) Vasotec. Patients also reported feeling significantly better on LCZ696 than on Vasotec, yet Novartis highlighted that LCZ696 maintained a safety profile that was acceptable.
If LCZ696 does indeed reduce the strain on the heart compared to other treatments, then the reduction in mortality and the improvement in quality of life among heart-failure patients could make the drug a game-changer in treating the disease for years to come.
Brian Orelli: Vertex Pharmaceuticals has a PDUFA date of July 5 for its lumacaftor and ivacaftor combination to treat a subset of cystic fibrosis patients.
Ivacaftor, which goes by the brand name Kalydeco, is already approved as a treatment for a different subset of cystic fibrosis patients. Vertex believes it can sell between $560 million and $580 million worth of Kalydeco this year to treat the more than 3,400 patients the monotherapy is approved to treat.
Kalydeco may never get to blockbuster status on its own, but in combination with lumacaftor, it has this potential. There are 22,000 people with cystic fibrosis that are age 12 and older who have the mutation that Vertex is asking the FDA to approve the combination to treat. Vertex could potentially charge less for the combination pill, and still easily get to blockbuster status considering the market is more than six times larger.
Of course, the combination pill still needs to get approved by the FDA and other regulatory authorities. The FDA scheduled an advisory committee meeting on May 12 to review the combination, which could be a sign reviewers may have some questions about it, but investors shouldn't be too worried.
The combination only modestly increases patients' ability to breathe, albeit by a statistically significant margin compared to placebo, so the FDA likely wants input from its outside experts about whether the improvement is clinically meaningful. As a secondary endpoint for the clinical trials, Vertex showed that the combination helped patients avoid pulmonary exacerbation -- defined as events of worsening signs and symptoms of the disease requiring treatment with antibiotics -- compared to placebo, which argues that the improvement is indeed clinically meaningful, if only marginally so.
Rather than be worried about an FDA approval, investors should be more concerned with how many of those 22,000 patients will actually take the medication. With a marginal benefit, some patients may not bother, even though there aren't any other drugs to treat the underlying condition. Fortunately, the market is large enough that Vertex doesn't need anywhere near 100% penetration to reach blockbuster status.
Brian Orelli, Dan Caplinger, and Todd Campbell have no position in any stocks mentioned. The Motley Fool recommends Express Scripts and Vertex Pharmaceuticals. The Motley Fool owns shares of Express Scripts. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.