Some data points on Antegren for MS and CD from Goldman's Maykin Ho. Tends to support, for the moment, more conservative Antegren revenue estimates, an additional trial necessary for CD and resistance to Antegren takeup for MS patients currently on effective combo therapy. The analyst also suggests, re. BIIB, that Antegren will cannibalize Avonex to some extent, yet still result in incremental sales of >$1b (places it in range of the $1.3b figure mentioned elsewhere on the thread).
<<During our conference call yesterday, BIIB management provided updates on Avonex,
Antegren and Rituxan. We continue to expect BIIB to 1) file an FDA application for
Antegren in multiple sclerosis (MS) in mid−2004, 2) Phase III data on Antegren in Crohn’s
disease in 5/04, and 3) European Phase III data for oral fumarate in psoriasis in H2/04.
BIIB shares may stay in the $50s in the near term until the manufacturing issue for
Avonex is resolved. In case patients need to switch to the powder from the liquid
formulation we estimate EPS impact to be $0.05− 0.10 in 2004. The shares should
appreciate by yearend withanticipation of Antegren approval as well as Phase III data on
Antegren, Rituxan and Fumarate withcombined potential of $2B. The risks include
slower sales, development failures, reimbursement cuts and generic competition. We
maintain our Outperform rating on BIIB witha Neutral coverage view.
Full details
Mr. Peter Kellogg, EVP and CFO and Dr. Burt Adelman, EVP Development of Biogen
IDEC presented during a Goldman Sachs ’In Your Office’ conference call yesterday. The
highlights are as follows:
1. MODEST EARNINGS IMPACT IF AVONEX MANUFACTURING ISSUES PERSIST
<snip>
2. POTENTIAL ANTEGREN LAUNCH IN 2005
Biogen IDEC expects to file an FDA application for Antegren in multiple sclerosis (MS) by
mid−2004. The Phase III data on Antegren in MS may be presented at the 20th Congress of the
European Committee for Treatment and Research in Multiple Sclerosis− Vienna, Austria.
10−6−9/2004, or the annual meeting of the American Neurological Association− Toronto,
Canada. 10/3− 6/04. By the fall 2004, we believe that all patients in the AFFIRM trials
(monotherapy of naïve MS patients) and the majority of patients in the SENTINEL
(combination therapy of patients who relapsed on Avonex) trial would have completed the 2 year
follow up. Therefore, presentation of the 1 year interim data should not have a significant impact
on unblinding the study. We expect results of the AFFIRM trial to be similar to the Phase II trial
(50% reduction in relapses and 90% decrease in MRI brain lesions). If the FDA agrees to a
priority review, Antegren might be launched in early 2005. Under a regular review, launch would
be in 2005. Biogen IDEC will initially manufacture commercial Antegren at Biogen’s
manufacturing plant in Research Triangle North Carolina. The Oceanside facility previously
owned by IDEC will be used for capacity expansion.
3. WE EXPECT PREMIUM PRICING OF ANTEGREN AND $1B POTENTIAL
We expect Biogen IDEC and Elan to price Antegren between $13,000−20,000 per year. The
average cost of therapy for Avonex, Betaseron (Chiron/Schering AG) and Copaxone (Teva) is
about $10,000 per year. Rebif (Serono/Pfizer) costs about $13,000 per year at the high dose.
Assuming Antegren is effective as a combination therapy for refractory MS patients and superior
efficacy as monotherapy, we expect the price to be higher than that of Avonex. Furthermore, we
believe the likelihood of Antegren showing efficacy in Crohn’s disease (CD) is high. The current
standard biological therapy for CD is Remicade (JNJ) which can cost over $20,000 per year. As
with Remicade, physicians will be paid a fee for the IV infusion of Antegren (maybe 6% premium
over the average selling price of Antegren). Therefore, there may be financial incentive for some
physicians to use Antegren.
We believe there will be some cannibalization of Avonex by Antegren assuming the latter is
effective as monotherapy and as a combination with Avonex. However, incremental sales should
still exceed $1B in MS. The major usage will likely be for refractory patients and patients who
have stopped current therapies (quitters) and for those who are switching from interferons
(Avonex, Betaseron and Rebif) or Copaxone. Patients who are satisfied with Avonex, Betaseron
Rebif and Copaxone are unlikely to switch to Antegren monotherapy or shift to combination
therapy. Even though the SENTINEL study involves Avonex plus Antegren, physicians may
combine Antegren with either Betaseron or Rebif because the 3 interferon products are similar in
efficacy and major side effects. However, it is not clear whether third party payors will reimburse
the untested combinations of Antegren plus Betaseron or Rebif. Biogen is conducting a study to
evaluate the combination of Antegren with Copaxone.
4. DECISION ON EUROPEAN FILING OF ANTEGREN IN CROHN’S DISEASE EXPECTED
IN H1/04
We believe the ENACT−2 data for maintenance therapy and ENACT−1 data for induction
therapy indicate that there is biologic activity of Antegren in Crohn’s disease (CD). However, the
results are probably not sufficient to support a marketing application to the FDA. Therefore, we
expect management to delay filing until the data from a second Phase III study are available,
probably in 2005. The second study has just started. We believe management has designed the
protocol to minimize the risk of a high placebo rate. Results may be available in late 2004 or early
2005.
Management plans to meet with the European regulatory agency to determine a filing strategy. We
expect a management decision on filing in H1/04. If the European agency accepts the application
in H2/04, we expect an approval late 2005/early 2006.
We estimate the sales potential of Antegren in CD to approximate $300MM. While Remicade
Goldman Sachs Global Equity Research 2
Biogen Idec, Inc. March18, 2004
steroids and other immunosuppressants are routinely used for CD, there are limited therapies for
maintenance. Furthermore, most of Remicade patients cannot sustain the response with time.
I, Maykin Ho, PhD, hereby certify....>>
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