Glaxo's Relenza Flu Drug Rejected by U.S. FDA Panel
Bloomberg News
February 24, 1999, 8:04 p.m. ET
Glaxo's Relenza Flu Drug Rejected by U.S. FDA Panel (Update10)
(Changes dateline, adds Glaxo's closing London share price
in 5th paragraph.)
London, Feb. 25 (Bloomberg) -- Glaxo Wellcome Plc's Relenza
flu drug failed yesterday to win the backing of an expert U.S.
government advisory panel reviewing the drug.
Glaxo, the world's No. 2 drugmaker, failed to prove
its inhaled drug was effective enough in fighting flu symptoms
to justify its approval for sale, the panel found on a 13-4 vote
yesterday. Positive findings from two small studies in Europe
and the Southern Hemisphere weren't enough to overcome doubts
about the drug from an inconclusive study of North American
patients, the U.S. Food and Drug Administration panel said.
''There isn't sufficient efficacy for me to recommend this
drug for myself or my family,'' said Leslie Hendeles, a panel
member from the University of Florida Health Science Center.
Before the panel reviewed the studies, analysts had
expected a favorable recommendation.
Glaxo's American depositary receipts fell 2 to close at 65
5/16 yesterday in New York after trading as high as 68 5/8
during the panel's deliberations. Shares of Gilead Sciences
Inc., working on a similar drug, fell 1/4 to 42. Glaxo's London
shares, which ended their trading day before the announcement,
rose 80 pence to 2,148p ($34.36).
Panel members voiced enthusiasm for the technology behind
the drug, which attacks the flu virus by blocking an enzyme it
needs to develop and reproduce. That could mean Gilead could
have an easier review because analysts don't expect the same
kinds of problems with its data.
Positive for Gilead?
''This could end up being very positive for Gilead if they
have the data,'' said Jon Alsenas, a biotechnology analyst at
ING Furman Selz with a strong buy rating on Gilead.
Roger Mills, director of clinical research for Gilead,
declined to compare Gilead's drug to Glaxo's. He said, however,
that two major studies of its drug have been presented at a
major medical meeting and both were statistically significant, a
threshold that Glaxo failed to meet for its North American
study.
For their part, Glaxo officials said they will work with
the FDA to win approval of the drug and overcome the panel's
doubts. ''We'll need to regroup over the next few weeks or
months,'' said Michael Elliott, Glaxo's international influenza
project leader.
Glaxo officials earlier told the panel that studies of
Relenza showed it can significantly reduce the duration of the
flu, which strikes some 30 million Americans each year and sends
tens of thousands to the hospital.
Feeling Better?
FDA reviewers questioned the company's studies, saying they
may not accurately measure whether patients feel better. The
largest study of the drug -- conducted in North America --
failed to show a statistically significant reduction in the
length of the illness, they said.
''This worries us,'' said Barbara Styrt, an FDA reviewer.
Additionally, when FDA reviewers went back and analyzed two
other successful studies -- in Europe and in the Southern
Hemisphere -- they found that the study's design may not
accurately reflect patients' overall state of disease. While
patients may be considered ''alleviated'' by the study's
standards, they may not in truth feel much better than patients
who weren't considered ''alleviated,'' they said.
Before seeing the data presented yesterday and hearing the
FDA reviewers' opinions, analysts said they expected the drug to
win approval and generate sales of $300 million by 2002. Still,
they said it's not a crucial product for the U.K. drugmaker.
''It's not going to make or break Glaxo,'' said Michael
Krensavage, an analyst at Brown Brothers Harriman with a short-
term strong buy rating on the company. If it does win approval,
the drug will be a ''nice positive,'' he said.
Influenza, commonly known as the flu, strikes as many as
100 million worldwide each year. In the U.S., flu results in an
estimated 20,000 to 40,000 deaths and 50,000 to 300,000
hospitalizations every year, Glaxo said.
Relenza, part of a new class of drugs designed to fight the
flu, acts by blocking an enzyme needed for the virus to
replicate. Foster City, California-based Gilead and
Switzerland's Roche Holding AG have developed another drug in
the class, which comes in a pill rather than in an inhaler.
Before today's hearing, analysts said the two drugs could
compete in a market worth $500 million to $2 billion.
Relenza is about six months ahead of the Roche drug in the
approval process. While both have gone through the final phase
of human trials, Roche has yet to apply for FDA approval.
Glaxo licensed Relenza from the Australian drugmaker, Biota
Holdings Ltd.
--Brian Reid and Kristin Jensen in Gaithersburg, Maryland with
news.com
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