I hope this isn't illegal.
BOSTON -- Although investors sold when Biogen Inc. and Idec Pharmaceuticals Corp. first announced their merger last year, the newly constituted Biogen Idec Inc. is now riding a wave of euphoria. Its stock is up 71% this year, giving it $20.9 billion in market value -- about 11 times total sales.
What is behind the reversal? Optimism about Antegren, a new therapy for multiple sclerosis under joint development with Elan Corp.
Rarely has so much been riding on a drug not yet approved by the Food and Drug Administration.
If the FDA clears it, forecaster Sagient Research estimates world-wide Antegren sales will peak at more than $2 billion by 2011. Biogen Idec expects that over the next few years, Antegren could help expand the MS drug market to $6 billion from $3.6 billion today. Even competitors see a gain. "It will grow the market, no question," said James Pusey, executive vice president of neurology for Serono Inc., the U.S. division of Serono SA, which makes the rival MS drug Rebif.
Since Antegren works differently than other drugs on the market, doctors looking for a more powerful therapy could prescribe it in combination with other medicines. Antegren also may fill a gap for some of the large number of MS patients who don't respond to existing treatments.
Biogen Idec sought FDA approval for the drug last month in an unusual application based on the first year of results from two clinical trials. In the past, the FDA has considered MS therapies only after two years of study. The early filing signaled to many investors that the yet-to-be-disclosed trial results were much better than those for therapies already on the market -- a suggestion that Biogen Idec has done little to dispel.
"The one-year data are obviously very positive," said Burt A. Adelman, the company's executive vice president of development. A decision by the FDA could come before the end of the year, following the company's request for an accelerated review.
"One hopes that the optimism this most recent announcement has generated is well considered and appropriate," said Stephen Reingold, vice president for research programs at the National Multiple Sclerosis Society.
Dr. Reingold said some of the optimism is warranted because Antegren is a new class of drug and because of promising data from an earlier, Phase II trial that involved fewer people for a shorter duration than the later trials under current FDA review. In the earlier trial, there was a reduction of 50% in the number of patients experiencing a relapse of symptoms related to MS, such as tingling, muscle weakness and double vision.
The drug also is being studied as a treatment for Crohn's disease, a fairly common condition that causes inflammation in the small intestine. U.S. approval as a Crohn's disease treatment is less promising, because of disappointing trial results, but the company has filed for European approval as a Crohn's medicine.
Biogen Idec has no other drug with similar blockbuster potential close to approval. Many of its most exciting candidates are still in early development and are years from market. At the same time, recently approved drugs from the company have been disappointing.
Amevive, a treatment for psoriasis approved by the FDA last year, is beset by poor sales and increased competition from other new psoriasis treatments, such as Genentech Inc.'s Raptiva. Zevalin, a treatment for non-Hodgkin's lymphoma approved in 2002, hasn't widely established itself and posted sales last year of $20 million.
Nearly all of Biogen Idec's $1.85 billion in revenue last year came from two drugs. Avonex, the market-leading MS therapy, reaped $1.17 billion. Rituxan, a cancer drug under testing as a treatment for several autoimmune diseases, generated $493 million -- the company's share of sales under an agreement with Genentech.
Biogen Idec is testing Antegren two ways. In one trial, Antegren is being compared with placebo. In a second test, the drug is combined with Avonex and compared with placebo.
If the combined drug therapy is better than Antegren alone, Biogen Idec could see a double benefit. But if not, sales of Avonex could fall as doctors and patients switch to Antegren. Avonex has 42% of the U.S. market for MS drugs, according to data from IMS Health Inc.
Analysts expect Antegren to cost as much as or more than current therapies, which can run as much as $14,000 a year. Unlike current treatments, the most popular of which are self-administered with a daily or weekly shot, Antegren is given as a once-a-month infusion in the doctor's office.
Avonex and rival Rebif are beta-interferons, synthetic versions of naturally occurring human proteins that appear to modulate the immune system. But Antegren is one of a new class of drugs called selective adhesion molecule inhibitors. The drug attaches to potentially damaging immune cells to block them from migrating from the bloodstream into the brain, where they cause inflammation and kill nerve cells.