QLTI for those interested.
NB raises 2001 sales estimates to US$251 million. Thinks consensus estimates too low.
EVENT: A second Phase III trial for Visudyne will be required to obtain U.S. approval for occult AMD. The two-year data on the occult population from the VIP trial has been ublished in the May issue of the American Journal of
Opthalmology.
IMPACT: Negative. The requirement for two trials means that an approval in the U.S. is not likely until 2004. Most did not carry any forecast for an approval, and sales forecasts for the next two years will not need to be changed, although, the delay has a psychological impact. We believe, however, this will be short lived since the biggest driver to QLT shares over the next 12 months will be Visudyne sales, and estimates are likely to be exceeded.
The data was published rapidly, and this is always a sign of its importance. The publication of the data will allow
physicians and Novartis to begin the process of seeking reimbursement.
We would take this weakness as an opportunity to buy.
DETAILS: Willey Chambers, the head of the ophthalmology division at the FDA, is of the opinion that occult AMD is a
different disease than predominantly classic AMD and will require two separate Phase III trials for approval. The company is working on a new protocol with different treatment parameters in order to have an even stronger impact on
the disease. With a second trial, data is likely in 2003 and approval in 2004. This should have no impact on the European
approval expected in 2002.
The publication of the data will allow its widespread distribution and we are likely to see limited off-label use in H2/01.
As a result, we are increasing our 2001 sales estimates from US$243 to US$251.5 million. This is slightly above
management’s guidance of US$225-250, and well above consensus of US$233 million. Following ARVO, our optimism
regarding the potential for off-label use increased, and we believe the consensus sales forecast is too low for 2001.
We are not changing our 2002 sales estimates for now. With our sales forecast of US$389, we are well above consensus
estimates of US$337 million.
The publication will also allow the initiation of the reimbursement approval process. Most drugs are routinely reimbursed
for off-label use provided sufficient published information to support its use is available, but Visudyne represents an
exception. As is well known, due to the potential for a very large price tag, last year HCFA took the unusual move of
implementing a national policy restricting the reimbursement of Visudyne to predominantly classic AMD patients. With
the publication of the two-year results from the VIP study, we will no doubt see pressure mounting to allow
reimbursement. Although we believe it will take some time to accomplish this, we believe it is feasible. In the meantime, we expect some limited off-label use. |
