Neurogram+ 10-5-15

Greed Jumps the Shark1

Future pharmarchaeologists may try to unearth and analyze the sequence of events that triggered the eventual imposition of pharma price controls in the United States, for so long the bastion of pharmacoeconomic free enterprise. It is like exhuming the skeletons of Pompeii, except that they did nothing to trigger Mt. Vesuvius’ wrath, whereas this cataclysm was largely self-induced. From our viewpoint, the first major warning tremor came with Gilead’s pricing of Solvadi for Hepatitis C, where the cost, multiplied by the size of the potential treatment population, portended fiscal distress for American payor systems. But the advent of a competitor, and the restriction of access by payors, kept the crisis from burgeoning out of hand. But recent incidents of extreme price-gouging, amplified by the populist lens of an approaching election year, have put pharma drug pricing back in the crosshairs of editorial writers everywhere.
First, Turing Pharmaceuticals acquired a grizzled antibiotic (Daraprim) used for toxoplasmosis, and immediately raised the price 5400%, from $13.50 to $750 per tablet. When challenged, the justification claimed by CEO Martin Shkreli was that this would fund R&D and physician education, displaying a level of disingenuous smarminess close to self-parody. Shkreli finally promised to roll  back Turing’s price increase by some undisclosed amount. Rodelis Pharmaceuticals announced a 2000% increase in the price of cycloserine, used in the treatment of tuberculosis, after acquiring it from a nonprofit group. In the resultant outcry, the sale was canceled, the drug returned to its nonprofit owner. Similarly,  Valeant Pharma has been called out on its chronic appetite for a spate of abusive price-escalations.
Damage has been done: Democratic Party presidential candidates have mustered their outrage and called for regulatory controls, including proposals for requiring R&D expenditures to reach some minimum level (we would like to see Valeant’s research-phobes deal with that one); restrictions on the deductibility of DTC advertising costs (though DTC spending levels have indeed reached an absurd apogee); the acceptance of pharmaceutical imports from lower-cost countries; a reduction of marketing exclusivity for biologics; and the possibility of price controls. Like many campaign promises, these specific proposals may only have a shelf life of one or two polling cycles, but it would be naive to think that this issue will go away.
This serves as a salutary lesson on what happens when people-in-power possess neither a conscience nor the frontal-lobe capacity to appraise the future consequences of their actions. Valeant’s CEO Michael Pearson pathetically defended Valeant’s strategy as necessitated by his obligations to “shareholders”, apparently oblivious to the consideration of anything more than next-quarter’s earnings report.
Turing, Valeant, and Rodelis are nothing but entities bent on exploiting market anomalies, but the rank arrogance of their gouging exacerbates the overall public perception of the pharma industry as a club of robber-barons. Greed has jumped the shark, and the pharma industry as a whole is going to eventually suffer some pain as a result.2

1 “Jump the shark”: An American idiom that initially referred to a television show that signals its impending decline by resorting to some gimmick or story device that undermines its own premise or credibility. It has gradually been broadened to indicate a moment of excess in any industry or endeavor that constitutes a tipping point, after which decline/deterioration can be expected.
2 Some pain has already been felt: The NIR Stock Index dropped 25.6% from July 1 to October 1, as the topic of possible price controls resurfaced.


Two Science Notes

1) Roche announced positive data from a trial of ocrelizumab in PPMS, which along with a previous report of positive results from MedDay, albeit in an earlier-stage trial, signals the possibility that disease-modifying progress is finally being made vis-a-vis Progressive MS.
2) We were intrigued by the report that the HERV-K retrovirus may play a key role in the initiation of ALS pathophysiology. While this is a hypothesis that will require validation over time, it is reminiscent of the work being done by GeNeuro in the role of retroviruses in the onset of MS and schizophrenia.

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FRM-6124 Trials Halted

There is a highly credible report that the Forum Pharmaceuticals Phase III trials for encenicline/FRM-6124 are being halted due to a safety issue: Gastric hypomotility setting the stage for eventual gut perforation. FRM-6124 is a program that NIR has long followed, and while there have been questions raised regarding the magnitude of its procognitive impact, we have seen it as one of the more promising options for cognition in Alzheimer’s and schizophrenia, the one clinical-stage nicotinic alpha 7 modulator still left standing. Forum has not yet made a public announcement, we await any detail that may come from them on this. But in the meantime, this would be devastating news. It would leave the 5HT-6 antagonist programs from Lundbeck/Otsuka and Axovant  as the most advanced procognitive candidates for Alzheimer’s. Unless and until a disease-modifier establishes efficacy in the Alzheimer’s realm, and nothing has yet produced a clearcut, consistent signal, symptomatic therapies will continue to receive clinical and investor emphasis, even if their magnitude of clinical effect is marginal–so long as they exert that effect safely. It appears that FRM-6124 has failed that critical test.

Addendum: Forum’s press release was finally sent out, and it provided some additional detail regarding the Phase III programs: The Alzheimer’s programs have been fully suspended, no additional study drug will be administered during the clinical hold.
The schizophrenia efficacy trials, which are fully enrolled, will continue, with additional GI safety monitoring provided. The premise is that elderly Alzheimer’s patients, who have a documented elevated incidence of GI disorders, may be particularly–or even uniquely– vulnerable to this AE. No patients in the schizophrenia trials have shown this AE (they have an average age of 40) hence the decision to allow the completion of the two efficacy trials. However, a longterm safety study in CIAS was halted, so the FDA is hedging their bets regarding FRM-6124’s safety in even the younger CIAS population.

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The Sharing Economy: Pharma Version

The Twenty-First Century ‘Sharing Economy’ has achieved a high profile and been sometimes rewarded with massive valuations over the past few years, with AirBnB and Uber epitomizing the model of sharing the costs and benefits associated with an asset. The Pharma version involves two companies joining forces on a program, sharing the costs, risks, and potential rewards. The difference between the Pharma iteration of SE and the aforementioned AirBnB and Uber is that, in the Pharma world,  there is also a change in ownership of the asset, but the sharing concept still has some applicability. Now, we have a brand new example of this being applied in the neuropharm arena:

(BioCentury 9/1/15)
Amgen Inc. and Novartis AG will collaborate to co-develop and co-commercialize candidates in Alzheimer’s disease and migraine. The companies said they will combine beta-site APP-cleaving enzyme (BACE) inhibitor programs to treat AD. Novartis’ CNP520, which is in Phase I/IIa testing, will be the lead candidate. Amgen will make undisclosed upfront and milestone payments to Novartis, and pay “disproportional” R&D costs for an undisclosed time frame, after which the companies will share equally global profits and costs for all AD assets. Novartis will receive global co-development and full ex-U.S., Canada, and Japan commercialization rights to Amgen’s migraine candidates including mAbs AMG 334 and AMG 301 in return for paying “disproportional” R&D costs and double-digit royalties.”
Just one day earlier….
(from NeuroPerspective, Sept-October 2015, released 8/31/15)
“Given the enormous scale of late-stage clinical trials in AD, several companies have decided to collaborate on the therapeutic programs as well. While there are some companies (e.g. Roche/Genentech) who are willing to double-down and carry the costs of multiple disease-modification programs, for those who want to go for the gold ring of arresting Alzheimer’s at its biological source, there is value and safety in partnering around one or more mechanisms, to avoid risking too much credibility and capital. Biogen/Eisai, Lilly/AstraZeneca, and Lundbeck/Otsuka exemplify pairings that provide some insurance against excessive exposure in the event of failure. Collaboration means relinquishing hubris in the service of sharing both the risk and the reward, but one-third or one-half the revenue that will come from a successful Alzheimer’s drug will be–or should be–more than sufficient for any pharma company.”
We would like to take full credit for thereby inspiring the Novartis/Amgen deal, but unfortunately, we cannot. This is an excellent example of an illusory correlation that has nothing to do with causality. However, and more importantly, the agreement epitomizes pragmatic diversification and risk-reward sharing. Amgen will shoulder a major share of Novartis’ Alzheimer’s costs/risk in venturing into a BACEi field not lacking for competition (Merck, Biogen/Eisai, Lilly/AstraZeneca); while Novartis is taking on some of the challenge of bringing Amgen’s CGRP-antibody into a now crowded CGRP-migraine field (Teva/Labrys, Allergan/Merck, Lilly/Arteaus, and Alder Pharma).
There is a bonus here: Amgen, with all of its resources, had largely exited neuroscience several years ago. They are finally giving some indication that they see neuroscience as something more than just a headache. We hope that this presages greater investment in this area.

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She Loves Me, She Loves Me Not

NIR has not covered the journey of flibanserin/Addyi , but we have watched with interest, and as the FDA decision loomed, we fielded a couple of calls from print journalists inquiring about our views on this somewhat controversial drug for female sexual desire disorder. Yesterday’s FDA approval was followed by today’s billion-dollar acquisition of Addyi by Valeant, and a comment is in order, since the very essence of the Addyi premise is that to a large degree, this is a ‘brain-based disorder’, as opposed to male sexual dysfunction, which is largely, albeit not entirely, an issue of  hydraulics.

Addyi is a mediocre drug with a minuscule therapeutic effect, one that provides a minimal level of improved sexual functioning to a small minority of women trying it. It has some problematic side effect issues. But we do believe that it was the correct decision to approve Addyi, now the first and only drug tested, approved, and labeled for a condition which is estimated to affect sixteen million women in the US alone. Part of this is a gender politics quandary; in an environment where drugs for male sexual dysfunction have become a part of the popular lexicon, purchased (and covered by insurors) to the tune of many billions of dollars per year, and couples in hot tubs gazing at the horizon have become a routine backdrop for televised sporting events, we would not want to be the regulatory agency saying no to the  attempt to develop something of a parallel for women. Frankly, to say no to the offering of an option would have been an exercise in condescending paternalism, and this is the last area where paternalism should show its face. It is a domain where women and their physicians should be able to make informed decisions.

After all, this is a domain that is poorly understood, and neural chemistry is just one factor amongst a host of others, including the hormonal and interpersonal, that mediate a woman’s level of sexual desire. There is no way for a single compound to provide a panacea for something that is so highly interwoven with the context of a relationship. In fact, it may matter little just how much actual pharmacologic impact this drug has, vis-a-vis how much is based on expectancy, and the inevitable placebo effect: Just the contemplation of whether or not to try Addyi will have a reverberating effect within a couple’s relationship, and indeed, couples therapists should have field day contending with couples wrestling with the decision to try–or not to try–a pharmacotherapeutic intervention. It brings their sexual relationship, and the role of women’s desire, to the forefront, and if the effect is to foster more sexual intimacy, that has the potential to be self-reinforcing. To that degree, even more than in so many disorders, this will harness the placebo effect in a way that could be more durable than it usually is. Of course, if it is the relationship itself that is the primary source of dysfunction, then a drug intervention will  fail, sooner rather than later.

This brings us to Valeant Pharmaceuticals. We despise Valeant, a company that routinely treats acquired companies like poachers who have machine-gunned an elephant in the veldt, stripping the tusks while leaving the carcass to rot in the tropical heat. But in this case, there is nothing else, no R&D operation to be trashed; Sprout Pharmaceuticals is a one-product gamble that has paid off very well for the entrepreneurs who acquired flibanserin after Boehringer Ingelheim dropped it. We are somewhat stunned at the billion dollars to be paid upfront (even if in two installments); with the uncertainties attached to Addyi, we expected a deal that included more in the way of sales milestones. It is possible, that if initial word-of-mouth is negative, or if insurors resist the (initially cited) $5000 per year price tag (they will rue the day, if they reimburse ED drugs more liberally), that Addyi will end up only a minor success. But if just 1% of the projected, potential patient population in the US uses Addyi for six months in a year, that would produce gross revenue in the $400 million range (we are not going to spend time projecting rebates and the like). Addyi is not going to be a product to rival the Viagra and Cialis franchises, it costs too much and provides too little, but it is likely to be remunerative for Valeant. We only wish we could be a fly on the wall of the advertising agency brought in the develop the eventual OTC marketing campaign for Addyi, which is going to have to walk a tightrope of nuance as they navigate this marketing minefield.

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Over the weekend, Naurex announced that it had been acquired by Allergan (Actavis/Forest) for $560 million plus undisclosed milestones; Allergan is focused upon Naurex’s two clinical-stage Rapid-Acting-Antidepressant candidates, IV rapastinel/GlyX-13, and orally-bioavailable NRX-1074. NIR has been following this particular technology since 2003, through its iterations as Nyxis Neurotherapies and then Naurex; in fact the first time we invited Naurex to present GlyX-13 as a ‘Top Partnering Opportunity’ at the TAP conference was back in 2010. We must admit that at first, our reaction to the sale announcement was lukewarm: After all, this has been another year of an open door for IPOs, and if an Axovant could take in $362 million, what might the far-more-promising Naurex portfolio have garnered by going public? Surely a new CNS record could have been set. But Naurex knew that, and the decision to sell rather than go public was based on calculations that were less drama-laden, but more rational:
To take both rapastinel and NRX-1074 all the way through clinical development would have required an enormous investment in infrastructure-building. Naurex has remained a barely-larger-than-virtual company, and while such expansion could have been achieved, receiving $560 million plus undisclosed later milestone payments represents a healthy ROI for its shareholders, particularly as it comes prior to the expense and risk  attached to Phase III trials and the regulatory maze.  These hurdles, yet-to-be-surmounted, are the reason for the divergence between this upfront valuation and that seen for the lower-risk, lesser-potential of Avanir and Auspex, each of which sold for $3.5 billion.
The two other interesting considerations are these: Allergan just announced the sale of its generics business to Teva Pharma, and the acquisition of Naurex makes tangible their intention to keep CNS as a key component of their branded pharma agenda. Given the recent and ill-considered retreats from CNS by several formerly major pharma companies, it can only be good for the neuroscience area to have a company with resources and chutzpah add itself to the licensing/acquisition mix, and their Forest-legacy depression expertise guarantees a highly-competent clinical trial and commercialization process.  But they are not looking to build an inhouse neuroscience research capability, and thus Naurex will spin out its preclinical assets, constituting a glutamatergic platform with potential in cognition and pain, into an independent company. The details on the latter are sketchy, other than Allergan will have right-of-first-refusal for several compounds, but we like the fact that there will be a small company, a ‘NuNaurex’, that will continue with its portfolio building, something that it could not have fostered had all of its energies and resources been funneled into late-stage clinical development. From a neuro ecosystem perspective, it is one of those elusive ‘win-win’ scenarios.

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mAbMEN: It’s Not Over


Eli Lilly: Experimental Alzheimer’s drug shows some benefit  (AP)
Eli Lilly’s Solanezumab Is the Alzheimer’s Drug Equivalent of the Internet Dress                (TheStreet)
Lilly says drug slows Alzheimer’s in patients with mild disease (Reuters)
Lilly’s Alzheimer’s Drug May Slow Patients’ Decline (The Wall Street Journal)
Biogen, Lilly Alzheimer’s Data Spark Street Debate   (Investor’s Business Daily)
 Biogen: Come On, the Results Weren’t That Bad (
 Biogen Alzheimer’s drug data falls flat, Lilly gets slight bump (Reuters)
 Alzheimer’s Trials Offer Few Answers for Investors or Patients (Bloomberg)
 Lilly Alzheimer’s Drug Shows Benefit in Those Who Start Earlier (Bloomberg)
 Promising Alzheimer’s Drugs Disappoint With Incremental Data (Forbes)   

The responses to the data releases for solanezumab and aducanumab were not a model of consensus. As is not unusual, the ramp-up of expectations prior to the solanezumab and aducanumab supplemental data had been unrealistically steep, and the aftermath featured a broad spectrum of divergent responses and interpretations, though the predominant themes were vague disappointment and confusion. When one media outlet has to describe results in terms of “weren’t that bad”, one is not in the presence of definitive success. The expectations were overheated, given the limited nature of what to be unveiled: Biogen’s addition of 52 week data for a dose-level cohort that had enrolled just 30 patients; Lilly’s report of results from an extension of two failed studies for solanezumab, selecting subgroups from those Phase III populations, then comparing outcomes between patients who had been on solanezumab with those who were on placebo until the extension component began, eighteen months later. The number of patients who completed Lilly’s extension study was 626, which might have been impressive, other than for the fact that the trial began with 1314 patients, and the extension component began with 1018. With the attrition rate more than 50% from the beginning of the trial, one must wonder whether the 48% who stayed the course were a representative sample of the subgroups Lilly had selected posthoc, who may or may not have been representative of mild Alzheimer’s (eighteen months later).

Consider the magnitude of change in the Lilly trial. The extension of course did not have a control group, the trial was predicated on the premise that if the drug is disease-modifying, those patients who started on the drug later would remain cognitively ‘behind’ those who started earlier. This is an experimental protocol that has yet to be embraced by the FDA (though Paul Leber played a role in its devise), and it may never be: It can be argued that the two groups are inherently different by virtue of one beginning treatment 18 months later than the other, perhaps having reached a different stage (and slope) of their disease course. Not everyone accepts this divergence as evidence that the disease-course has been modified. But just to take it at face value for the moment, the graph of the results showed the two groups mirroring each other, just slightly separated, for two years on the ADAS-cog. The divergence was statistically significant at all timepoints except the last one, where the p value shot up to .169. That could reflect the shrinkage of the population and/or greater variance in the test results for those who remained.

Even if Lilly’s framing of the results has merit,  the mean difference in ADAS-cog score decline one year into the extension study is just 1.91 points.  The FDA’s general rule of thumb is that a 4 point difference on the ADAS-cog is clinically meaningful. The ADNI group reported that mild AD patients receiving cholinesterase inhibitors declined an average of 9.25 points over two years; another 18 month study found a mean decline (in the placebo group) of 6.44 points. These studies point to a 4-4.6 point annual decline rate for this population, which means (with the caveat that decline rates in Alzheimer’s are not linear, and may vary between genders, with women declining more rapidly) that a 1.91 pt difference is a bit less than one would expect a modal patient to decline in six months.  Similarly,  on the MMSE, Lilly’s slide (we await the imminent publication of the trial report) showed what looked to be less than a one-point difference between the two groups at two years into the extension trial, 3.5 years into the overall study: Three points is considered to be a significant score change on the MMSE, or roughly, just under the decline that would be seen over an eighteen month period. Which would again point to an treatment effect tantamount to ‘six-months worth’ of progression. It is possible that the impact might grow over time, but then again, it is possible that some of this is ‘noise’, perhaps partly due to the notable attrition rate in the study.

Lilly may yet achieve statistical significance in the ongoing ‘Expedition 3’ trial, which uses a traditional placebo-controlled protocol, but even if they do, there is nothing in these results that suggests that clearcut clinical significance is to be assumed. But it is possible that even a minimal clinical effect might be accepted as better than nothing, provided that no safety concerns emerge (the original Phase III data showed just a 1% likelihood of vasogenic edema).

So here is a headline that captures the gist of the findings from the solanezumab data:
Solanezumab May Do Something, But Not Much–But It Might be Better Than Nothing  

We had initially thought that both mAbs had an equally lackluster day today, but that is not the case. First, it looks like 26 patients in total completed all cognitive test sequences in the long-awaited 6mg/12 month group. That is not a cohort size about which much is generally said when it comes to Alzheimer’s. Anomalies in the readout could reflect some outlier patient(s) whose impact would be greatly magnified by the small n. But when Biogen presented the results, they claimed that they fell in line with the preliminary data from last March, which is not completely true. The rate of decline on the CDR-SB did indeed place the 6mg group between the 3mg and 10mg groups, but it was much closer to the 3mg group. The neat dose-response relationship that had initially surfaced in March vaporized: The MMSE score decline for the 6mg group was almost identical to the very limited effect seen from 1mg, while the 3mg and 10mg groups clustered together in an oasis of statistical significance. The impact on amyloid plaque was linear, but since that did not consistently line up with functional effect, this raises more questions than it answers. Finally, the incidence of vasogenic edema in the 6mg group (37%) was nearly the same as in the 10mg group (41%), far above that seen with 3mg (6%). So the hope that the 6mg dose might ‘walk the tightrope’ and somehow provide 10mg dosing efficacy along with 3mg dose adverse effects was not fulfilled, at least not in this trial. While Biogen tried to reassure observers that the vasogenic edema findings were not particularly problematic (“typically resolved within 4-12 weeks”), the fact is that while 78% were “mild to moderate”, this means 22% were more severe. In a trial that enrolls 166 patients and makes brain scans easily available, that is manageable. In a general Alzheimer’s population, perhaps not. For example, if 100,000 patients were to receive aducanumab at the 6mg dose, and if the incidence rate in this trial is predictive, 37,000 could develop vasogenic edema, with 7500 of those cases being severe. That becomes a clinical monitoring and management challenge that could outweigh what looks like a modest-at-best treatment effect: Even the most seemingly efficacious dose (10mg) achieved just a 2.25 point difference on the MMSE decline rate at 12 months, on a test where three points is the minimum considered to be clinically meaningful. On the CDR-SB, where mild Alzheimer’s patients decline 1.4 points annually, the 10mg dose approached that level with a 1.24 point effect, the 6mg dose had just a .76 point impact, close to the ‘six-month’s worth’ noted for the MMSE. Again, these are tiny dose cohorts, and may not mean anything, but today’s additional data only beclouded the issue for aducanumab.
Thus, because of the added concern about vasogenic edema, the aducanumab headline reads like this:

Aducanumab May Do Something, But Not Much–It Might be Better Than Nothing, But Possibly Not 

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Walking It Back on Axovant

NeuroPerspective subscribers are aware that we have not been unreservedly enthused about Axovant; its 5HT-6 drug for Alzheimer’s (licensed from GSK); and their ‘biggest CNS IPO ever.’ There has been a genuine element of fervid overheating here, but unfortunately, the same can be said about our coverage. In specific, we have been highly critical of stock options and salaries being paid to the mother and brother of the CEO. The S-1 described them as “employees”, but provided no substantive detail, and when the CEO was asked about this by the WSJ, the question was, in the words of the WSJ reporter, “swatted away”. That is on Axovant, they should have been more forthcoming in addressing what could easily be perceived as unbridled nepotism.
But it is on us that we did not research the matter more carefully ourselves. As it turns out, the stock options and salaries are not just gifts being paid for by other people’s money: The CEO’s brother is in fact deeply involved in Business Development for Axovant, and the mother, a geriatric psychiatrist of thirty years experience, was at the recent ASCP/NCDEU meeting, actively involved in information-gathering. While one might argue that these professional staff hirings were not conducted  on the basis of an open competition/selection process, it is not as if familial hiring does not happen elsewhere (including NIR). So long as they have the qualifications needed, and are putting in the work, then they are participating in the great drug development enterprise/lottery, and there is no major criticism to be made. Or at least, not with the overly harsh stridency of our comments, which we regret.
So, it is now up to Axovant’s staff to earn their remuneration packages, and up to Axovant to justify the hefty investment made in them and RVT-101. We will be watching with great interest.

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