I don't think the Iressa panel has any relevance to Actimmune.
This view I expressed differs some from that expressed by TSC's Feuerstein here:
After Iressa, Investors Embrace Gentler FDA
By Adam Feuerstein
Senior Writer
09/25/2002 07:58 AM EDT
Click here for more stories by Adam Feuerstein
The Food and Drug Administration showed a softer side this week when it appeared to bend in
the face of growing public criticism that its overly harsh drug-approval standards ignore the needs of desperately ill patients. And that could be welcome news for the drug and biotech sectors, which have been stung this year by a string of regulatory setbacks.
Tuesday's decision by an FDA advisory panel to recommend approval for AstraZeneca's (AZN:NYSE - news - commentary - research - analysis) cancer drug, Iressa -- despite some serious concerns raised by FDA regulators -- all but forces the agency to loosen its standards at least a little, biotech observers say.
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In other words, the regulatory bar for FDA drug approvals, which at times this year has looked impossibly high, has now been placed at a much more manageable level. Frustrated biotech investors rejoice.
A New Era?
"This means wonderful things for the biotech sector," says Salomon Smith Barney biotech analyst Elise Wang.
Investors were quick to react Tuesday, bidding up shares of OSI Pharmaceuticals (OSIP:Nasdaq - news - commentary - research - analysis), ImClone Systems (IMCL:Nasdaq - news - commentary - research - analysis), Abgenix (ABGX:Nasdaq - news - commentary - research - analysis) and Genentech (DNA:NYSE - news - commentary - research - analysis), all of which are developing cancer drugs that, like Iressa, attack tumors by disrupting the out-of-control growth signals inside cancer cells.
Banc of America Securities analyst Mike King upgraded OSI to buy from market perform Wednesday, based on the bullish impact of the Iressa decision. OSI's drug, Tarceva, is very similar to Iressa, so the company's shares had been under heavy selling pressure in sympathy with AstraZeneca. Now that cloud has cleared, says King.
OSI looks even more attractive now, he adds, because the company is already conducting the kind of randomized, controlled study of Tarceva that the FDA and its advisory panel still wants AstraZeneca to do with Iressa. King's firm doesn't have a banking relationship with OSI, but he recently left now-defunct Robertson Stephens, which did underwriting work for OSI while he was an analyst there.
Grinchlike
Over the past year, the FDA has garnered the reputation as an unfeeling, uncaring bunch of naysayers with a tin ear when it comes to hearing the needs of patients with life-threatening illnesses. Just last week, the agency abruptly postponed two advisory panel meetings set up to discuss the merits of drugs to treat Fabry disease, a rare, fatal genetic disorder that has no known cure. The decision infuriated Fabry patients and their advocates, who have been waiting two years for a drug to reach the market.
AstraZeneca is getting a lot of credit for breaking through the agency's icy facade. The drugmaker did it, in part, by employing the old two-hanky strategy: Put real human beings in front of advisory panel doctors and let them tell their sad, but uplifting, stories of how Iressa saved their lives.
"There is no doubt that the patient testimony helped sway panel members' decisions. It was powerful stuff," says one hedge fund manager in attendance at the advisory panel meeting.
The public hearing portion of the panel meeting stretched for about 90 minutes, much longer than normal, says BofA's King. This testimony, coupled with the fact that Iressa has proven to be a safe and at least a partially effective drug, will likely force the FDA to look past some of its concerns. The most vocal and outspoken critic of Iressa at the panel meeting was an FDA statistician, yet he was ultimately overruled by the rest of the group.
"There is a lot of public pressure to get drugs approved, and don't think for a second that the FDA won't succumb to that," says King.
Still on Duty
But the FDA is still no pushover, King and others warn, which means that the regulatory agency could still decide to exact a toll on AstraZeneca before it approves Iressa. And get out of town if you think biotech and drug companies will find it easy to use the Iressa vote as a precedent to slip sloppy science by the FDA.
The FDA has until early January to issue a final ruling on Iressa. The agency could simply approve the drug outright, but that's not likely, given that the advisory panel and the FDA both agreed that AstraZeneca should conduct another Iressa study, this one with a control arm, to verify the drug's clinical benefit to patients. Even AstraZeneca said it was amenable to doing more work on the drug.
U.S. drug regulators could, however, issue an approvable letter to AstraZeneca, which makes final approval of Iressa contingent on at least starting a new trial. If the FDA plays more hardball, it may withhold approval until the trial is completed, but even then, the agency would OK a speedy trial design that would minimize any delays, analysts say.
"The FDA and AstraZeneca are in a bit of quandary as to how to proceed now. It's something that the two sides are just going to have to sort out," says Wang of Salomon Smith Barney.
And the aforementioned hedge fund manager, who's become a rather late believer in Iressa, warns that the good news for AstraZeneca may not necessarily spread to other firms. This fund manager was an early short-seller of ImClone, for instance, a position he's not ready to give up on.
"There was no question, even from AstraZeneca critics, that the quality of the Iressa data was high. The same thing cannot be said for ImClone and its data, and I think that still makes a big difference," he says.
Adds Wang: "This Iressa decision is not going to give other biotech companies carte blanche to simply do chintzy Phase 2 studies and expect to get FDA approval."
My concern is that an AC is not the FDA - but of course I wasn't at the meeting and haven't seen a transcript, and so I don't know whether we indeed saw evidence there of a kinder, gentler FDA (statistician excepted, of course).
Peter |
