Could you please advise the importance of the ruling since, while I'm long Biogen, I do not understand such matters.
this might help ...
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Ares-Serono Plunges After FDA Setback for MS Drug
Bloomberg News
March 2, 1999, 8:33 a.m. PT
Geneva, March 2 (Bloomberg) -- Ares-Serono SA shares plunged
10.8 percent, the steepest drop in more than six years, after a
setback for its bid to market a multiple sclerosis drug in the
U.S. and reduce its reliance on infertility treatments, where it
ranks No. 1 worldwide.
The shares fell 265 Swiss francs to 2,190 after the Swiss
drugmaker said the U.S. Food and Drug Administration won't clear
its Rebif drug while exclusive marketing rights remain in place
for two similar treatments -- Biogen Inc.'s Avonex and Schering
AG's Betaseron.
The decision is a blow to Ares-Serono, which said it counted
on Rebif to drive sales growth and help reduce its dependence on
the infertility market. It also dims the chance that the drug
will become a blockbuster by shutting it out of the largest
segment of the $1 billion worldwide multiple sclerosis market
until about 2003, analysts said.
''This is bad news,'' said Dieter Buchholz, who manages 600
million Swiss francs ($410 million) at Hottinger & Cie. in
Zurich. ''Though the drug is selling well in Europe and other
parts of the world, the main boost was expected to come from the
U.S.''
Today's share decline almost wiped out this year's gain. It
also marked the steepest drop since June 6, 1992, when Ares-
Serono fell 14.1 percent.
Analysts at Deutsche Bank Securities downgraded the stock to
''neutral'' from ''outperform'', following the announcement.
Better Than Rivals?
Ares-Serono claims its product, which is already sold in
Canada, Europe and Latin America, is easier to use and more
effective in higher doses than currently available treatments.
Unless the drugmaker can convince the FDA, though, it won't
be able to enter the U.S. market until about 2003, when Biogen
and Schering said their exclusive marketing rights expire. The
exclusivity stems from the so-called orphan-drug law, designed to
reward manufacturers for developing treatments for rare diseases.
The FDA's decision doesn't mean Ares-Serono is giving up its
efforts to challenge its rivals' orphan-drug rights, said
spokesman Christophe Lamps. ''We haven't abandoned the idea'' of
entering the U.S. market soon, Lamps said.
In addition to upholding Biogen and Schering's rights, the
FDA had questions about the data Ares-Serono submitted to prove
that the drug is safe and effective, the company said. Those can
be easily answered, according to Lamps.
''We need to submit additional clinical data but we don't
see any major difficulty in quickly answering the FDA's
questions,'' he said. Lamps said U.S. regulators had raised
issues about the drug's labeling, though he declined to give
details.
Symptoms Vary
Even if the company's additional information convinces the
FDA that the drug is both safe and effective, it will only win
tentative approval, and won't be able to sell it immediately
unless it can challenge its rivals' exclusive marketing rights.
Currently, Biogen's Avonex is the leading multiple sclerosis
treatment. Avonex sales rose 65 percent last year to $395
million, increasing in the U.S. as well as Europe, where the drug
competes with Rebif. Schering's Betaseron -- the German
drugmaker's No. 1 drug, sold in Europe under the name Betaferon -- had sales of $400 million last year.
By comparison, sales of Rebif, the newest treatment on the
market, almost trebled to $44.3 million in 1998.
Multiple sclerosis, often called MS, destroys the insulation
that protects and transmits impulses around nerve fibers in the
spinal cord, brain and optic nerves, so that nerve impulses to
and from the brain are distorted and interrupted. Scientists are
stymied about what causes the ailment, which often strikes people
in their 20s or 30s and is found most frequently among women in
colder climates.
Symptoms vary greatly and may include tingling sensations,
numbness, slurred speech, blurred or double vision, muscle
weakness, problems with bowel or sexual function -- and, in most
serious cases, paralysis. The symptoms may occur in any
combination and may come and go, making diagnosis difficult.
There is no cure for MS, and drugs only forestall the
symptoms of the disease, which affects an estimated 2 million
people worldwide.
--Marthe Fourcade in Paris |
