Merck KGaA, the world’s largest maker of chemicals for flat screens, gave a cautious 2010 outlook well below market forecasts and cut its dividend reflecting uncertainty over its drugs pipeline.

The family controlled drugs-to-chemicals company said on Tuesday it was targeting 3-13 percent growth in core operating profit this year, below the 25 percent seen in a Reuters poll.

“The guidance for the pharmaceuticals business is very weak and there’s also little transparency,” LBBW analyst Hanns Frohnmeyer said.

The shares were down 6.8 percent to 60.07 euros at 0920 GMT, the lowest in almost a year, while the European DJ Stoxx Health Care Index was down 0.4 percent.

The German company proposed the first cut in its regular dividend since 2004, down to 1 euro per share from 1.5 euro last year, while analysts had predicted an unchanged payout.

Companies around the world including German carmaker Daimler have been slashing their 2009 dividends amid the economic crisis. Still, fellow drugmakers Novartis and Roche are paying higher-than-expected dividends.

FALLING BEHIND

Merck has fallen behind rival Novartis in the race to get the first oral multiple sclerosis treatment to market after U.S. regulators held up Merck’s application to bring its cladribine pill to market.

In addition, Europe’s drugs watchdog last year rejected Merck’s application to use its key cancer drug Erbitux against lung tumors, the most common form of cancer.

“It seems Merck has budgeted marketing and development expenses for cladribine for this year even though uncertainty over regulatory approval lingers,” another analyst said, speaking on condition of anonymity.

“The wide range given for the expected operating profit is particularly ill-received by the market,” he said.

Fourth-quarter core operating profit — excluding one-off items tied to its 2007 takeover of Swiss biotech company Serono — slipped 16 percent to 258 million euros ($351.5 million), missing the average estimate of 309 million in a Reuters poll.

That was mainly due to 170 million euros Merck set aside for pending legal disputes linked to its former generics business — sold to Mylan in 2006 — and to licensing and development agreements over its best-selling Rebif MS drug.

On the upside, the liquid-crystals unit — the world’s No. 1 maker of chemicals used in for TV-, computer- and hand-held displays — posted an operating margin of 45.3 percent, better than expected and up from 31 percent last year, as demand for consumer electronics picked up, especially in China.

Merck shares trade at about 12 times estimated earnings over the coming 12 months, below the average multiple of more than 13 for drugmakers, amid uncertainty over future sales of cladribine and Erbitux, based on StarMine data.

Thomson Reuters StarMine weights estimates according to analysts’ accuracy track record.

Source: Reuters

Popularity: 1% [?]

Sam Waksal, the founder of ImClone Systems who fell from grace before the company became $6.5 billion takeover property for Eli Lilly, is back in the biotech world, trying to raise $50 million for a start-up, according to TheStreet.com.

Waksal (pictured at right in 2003) has an up-and-down bio highlighted by getting Imclone’s cancer drug Erbitux on the road to market. His lowlight came with a guilty plea to insider-trading charges for selling ImClone shares knowing FDA was going to issue a negative report on the drug before the agency’s eventual approval of it. Lifestyle diva Martha Stewart also avoided losses by selling ImClone shares, leading to her conviction on obstruction of justice charges.

Now Waksal wants to buy, develop or license new drugs aimed at cancer or infectious diseases, according to a prospectus being circulated to potential investors, according to TheStreet. It says $50 million would buy a 50% stake in the venture, which is called Kadmon.

Kadmon spells out its plans this say, TheStreet says:

We intend to replace the traditional, quantitative development paradigm of the pharmaceutical industry with a model that seeks out the most innovative elements of academia, and innovative activities in the private sector, dramatically increasing the number of high-value drugs we discover and develop, while keeping costs to a fraction of the industry mean.

Meanwhile, Lilly and Bristol Myers, which co-markets the drug, are trying to get it approved for an expanded list of uses. Erbitux produced 2009 revenue of $390.8 million of Erbitux, Lilly says.

Popularity: 1% [?]

Is there a ceiling on the price of cancer drugs?

A medicine called Folotyn, approved earlier this year for patients with a rare form of lymphoma, costs $30,000 per month, the New York Times reports.

The drug hasn’t been proven to extend patients’ lives; in a study cited by the FDA, tumors shrank in 27% of patients who took the drug.

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The price of cancer drugs has been rising, and many now cost thousands of dollars per month. Erbitux for colon cancer, co-marketed by Bristol-Myers Squibb and Eli Lilly, costs $10,000 a month, to give one example cited by the NYT.

Allos, the company that sells Folotyn, tells the Times it made a significant investment to develop the first drug for peripheral T-cell lymphoma. The company says the price isn’t out of line with other drugs for rare cancers, and patients are likely to use the drug for only a few months, because the cancer it treats is so aggressive.

The new wave of expensive cancer drugs for very sick patients, combined with pressure to slow the rising cost of health care, makes this a thorny issue. Here’s further reading on how docs are learning to talk about drug prices with cancer patients, and on the regulations that limit Medicare’s ability to control the use and cost of cancer drugs.

Source: The Wall Street Journal

Popularity: 2% [?]

Merck KGaA announced that it requested a re-examination of the negative opinion issued by the EMEA’s Committee for Medicinal Products for Human Use (CHMP) regarding the proposed use of Erbitux (cetuximab) to treat patients with non-small-cell lung cancer. The company said the decision “follows consultation with key stakeholders in the NSCLC treatment community, coupled with Merck’s confidence in the clinical data.”

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The drugmaker cited data from the late-stage FLEX study, and stated that “Erbitux is the first and only targeted compound in clinical development in more than 10 years to increase overall survival in an NSCLC patient population including all histologies.” Company spokesman Gangolf Schrimpf commented that Merck is open to restricting which patients with lung cancer are recommended to take Erbitux and does not intend to conduct additional testing to support the appeal.

The CHMP issued the negative opinion in July, saying it was concerned that Erbitux provided only a “modest” survival benefit to patients with lung cancer when added to standard chemotherapy. The committee also noted that some patients experienced severe side effects, which “were similar to the side effects seen in patients treated with Erbitux for other types of cancer.”

Source: FirstWord

Popularity: 3% [?]

A European Medicines Agency committee did the unexpected late yesterday, recommending that the cancer drug Erbitux be rejected as a treatment for non-small-cell lung cancer.

That caught the investment community by surprise, according to DJ Newswires and Bloomberg. A Q&A about the refusal was posted on the European Union regulator’s Web site today.

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Shares of Merck KGaA, which markets Erbitux in Europe, were down over 14% in today’s trading in Frankfurt. Investors also weren’t pleased with second quarter earnings posted by the German company, which isn’t related to U.S.-based Merck. Bristol-Myers and Eli Lilly, which co-market Erbitux in the U.S., were relatively unaffected in early New York Stock Exchange Trading.

Merck thought the committee might impose some restrictions on the product’s use, as both the EU and U.S. regulators have required for Erbitux treatments in other patient populations.

“We never detected that a no-approval could be an option,” Elmar Schnee, chief of Merck’s drugs unit, said on a conference call with analysts. Merck will appeal the decision but expects a year’s delay in the drug launch even if Erbitux is approved for this use, notes DJ Newswires.

The committee felt that the benefits of Erbitux, when added to chemotherapy, were “modest in terms of survival times” and didn’t appear to slow down the cancer. And, side effects for patients could be severe, according to the document released today.

“The benefits of Erbitux in the treatment of non-small cell lung cancer did not outweigh its risks,” wrote the committee.

Source: The Wall Street Journal

Popularity: 3% [?]

Amid much discussion around comparative effectiveness of medical treatments and whether cost should be a factor in treatment decisions, a new article in the Journal of the National Cancer Institute estimates it would cost $440 billion to extend life by one year for the 550,000 Americans who die annually of cancer, reports the WSJ.

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The authors, from the National Cancer Institute and National Institutes of Health, say that 90% of cancer drugs approved in the past four years cost more than $20,000 for 12 weeks worth of treatment.

Some drugs have limited upsides, and these shouldn’t be developed unless they will cost patients less than $20,000 for a standard course, they say. Two more recommendations from the authors: doctors shouldn’t prescribe cancer medicines for non-approved purposes, and new medicines with marginal benefits shouldn’t be used for those with advanced cancer.

Treating lung-cancer with Erbitux, a Bristol-Myers and Eli Lilly drug, costs $80,000 for an 18-week regimen but extends life by only 1.2 months, the authors estimate. Bristol-Myers says the real-world cost number of Erbitux is closer to $10,000 a month. Drug makers say the cost estimates are often exaggerated because most patients are only on them for limited amounts of time and many received financial assistance, according to the WSJ.

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So the challenge is this: How to develop new medicines — especially those that might help certain individuals a lot even if the benefit to patients as a group isn’t impressive — while trying to keep costs in check.

“We can’t add on Mercedes-like drugs one after another and have every single patient cost the system phenomenal amounts of money,” Eric Winer, chief scientific adviser to Susan G. Komen for the Cure, a breast-cancer advocacy group, told the WSJ. “But we have to be careful not to slow down the process of drug development. Ultimately it is medical therapy that will make a huge difference in people’s lives.”

Source: The Wall Street Journal

Popularity: 3% [?]

Merck KGaA announced Monday that the National Institute for Health and Clinical Excellence (NICE) issued a final appraisal determination recommending Erbitux (cetuximab) for use as a first-line treatment for certain patients with metastatic colorectal cancer, in combination with chemotherapy.

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The agency specified that use of Erbitux on the National Health Service is recommended for patients whose cancer has spread only to the liver and who have normal or wild-type KRAS tumours. Merck’s executive vice-president of oncology Wolfgang Wein stated that the drug “is the only targeted therapy endorsed by NICE for the first-line treatment of the disease.”

As part of a patient access scheme, Merck will provide a 16-percent rebate on the amount of Erbitux used on a per patient basis, NICE explained.

Source: FirstWord

Popularity: 3% [?]

Erbitux, the blockbuster cancer drug over which Bristol-Myers Squibb and Eli Lilly battled in the fight to buy biotech ImClone, is facing some hurdles in getting approved for new uses.

The FDA asked ImClone, now owned by Lilly, and Bristol-Myers, which still comarkets the drug, to submit more “pharmacokinetic” data before it would approve Erbitux to treat head-and-neck cancer, the companies announced today.

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Some of the clinical trials submitted to the FDA for the added approval were conducted outside the U.S. and involved different formulations of the drug than are typically used in U.S. patients. The agency wants the companies to show that the drug gets around in the body and is used in the same way in U.S. patients as those who took part in the clinical trials, Brian Henry, a Bristol spokesman, explained to the Health Blog.

The companies “are working as quickly as possible” to look through their existing data and to design an additional study in animals to demonstrate that the drug is indeed distributed and metabolized the same way, Henry said.

In January, the companies withdrew the Erbitux application for approval in treating a type of lung cancer after the FDA raised the same question about pharmacokinetics. The companies aren’t withdrawing the head-and-neck cancer application because it is much further along in the review process.

The FDA concerns don’t jeopardize the companies’ hopes about getting approved for these new uses, according to the companies. “These questions we’ve been asked about by the FDA are very specific,” Henry told the Health Blog. The requests also don’t question the efficacy or safety for current Erbitux patients at all, he said.

What does this mean for Lilly, considering it just bought ImClone last year for $6.5 billion?

“Lilly still feels very confident about the purchase it made with ImClone and our ability to provide value for shareholders with that acquisition,” Lilly spokeswoman Judy Moore told the Health Blog. “Erbitux was not the strategic driver [in the deal]. Lilly sees the long-term value of our investment as coming from the pipeline.”

Source: The Wall Street Journal

Popularity: 20% [?]

Research data published in the current issue of the NEJM demonstrates that the addition of Eli Lilly’s Erbitux (cetuximab) to a regimen of Roche and Genentech’s Avastin plus chemotherapy in patients with previously untreated metastatic colorectal cancer significantly shortened progression-free survival and resulted in inferior quality of life. Authors Cornelius Punt and Jolien Tol said that “our results argue against the combined use of anti-VEGF and anti-EGFR monoclonal antibodies with chemotherapy in cases of metastatic colorectal cancer.”

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The findings are from the previously presented CAIRO2 study involving 755 patients who were randomised to receive Erbitux and a combination of Avastin plus Roche’s Xeloda (capecitabine) and sanofi-aventis’ Eloxatin (oxaliplatin), or the same regimen without Erbitux. Results showed that median progression-free survival for patients in the Erbitux group was 9.4 months, compared to 10.7 months for those in the control arm. In addition, patients taking Erbitux also reported lower quality-of-life scores. Punt suggested that “there may have been a negative interaction between the two antibodies.”

The study also confirmed more recent findings that patients with colorectal cancer who carry a mutation of the KRAS gene do not benefit from Erbitux use. The authors reported that carriers of the genetic variant “had significantly decreased progression-free survival” compared with patients without the mutation who received Erbitux or compared with those who do carry the mutated gene, but who were only given Avastin and chemotherapy.

Source: FirstWord

Popularity: 4% [?]

- The Six-Month Primary Efficacy Endpoint of the Study was met: Both Doses of Investigational Agent Safinamide Significantly Increased “ON” Time in Levodopa-Treated Patients With mid- to Late-Stage Parkinson’s Disease

- Secondary Efficacy Endpoints of the Study Analyzed to Date Were met in Both Safinamide Dose Groups

Merck Serono, a division of Merck KGaA, Darmstadt, Germany, and its partner Newron Pharmaceuticals SpA (SWX: NWRN) announced today that the first Phase III trial of investigational agent safinamide as adjunctive therapy to levodopa (study 016) met its primary endpoint by increasing daily “ON” time in mid- to late-stage Parkinson’s disease patients with motor fluctuations by 1.3 hours. “ON” time represents periods when Parkinson’s patients experience their best level of motor functioning.

The two safinamide treatment groups of the study (receiving either safinamide 50 mg orally once daily or safinamide 100 mg orally once daily as adjunctive therapy to levodopa) demonstrated a statistically significant increase of daily total “ON” time compared to placebo. Throughout the six months of the study, patients treated with both doses of safinamide experienced an average increase of “ON” time of 1.3 hours per day compared to baseline. Patients in the placebo group (receiving placebo in addition to levodopa and other anti-Parkinson therapies) reported an average increase of daily “ON” time of 0.7 hour compared to baseline. The differences between both safinamide dose groups and placebo were statistically significant with p-values of 0.008 (safinamide 50 mg daily) and 0.005 (safinamide 100 mg daily).

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“The results indicate that safinamide, when used adjunctively to existing dopaminergic therapies for study patients in mid-to-late stages of Parkinson’s disease, increases daily “ON” time of motor functioning,” said Dr. Bernhard Kirschbaum, Merck Serono’s Executive Vice President for Global Research and Development. “These results represent a further step toward our goal to provide patients and doctors with urgently needed new treatment possibilities in the Neurodegenerative Diseases therapeutic area.”

Dr Ravi Anand, Newron’s Chief Medical Officer, said: “These results are extremely encouraging. In addition to increasing “ON” time and reducing total “OFF” time, as well as “OFF” time after morning dose in patients with mid- to late-stage Parkinson’s disease receiving optimized treatment with drugs including levodopa, dopamine agonists, COMT inhibitors, anti-cholinergics and amantidine, the results indicate a statistically significant improvement of motor function. Previously reported results from Phase II and Phase III studies have shown improvement of motor symptoms in early Parkinson’s disease patients on dopamine agonist monotherapy. These results from both early and advanced Parkinson’s disease patients underline safinamide’s potential to be used as adjunctive therapy along the continuum of Parkinson’s disease.”

This Phase III study was a six-month (24-week), randomized, double-blind, placebo-controlled international trial. It enrolled 669 patients with mid- to late-stage idiopathic Parkinson’s disease (more than three years of disease duration) receiving stable doses of levodopa, who had motor fluctuations with >1.5 hours of “OFF” time(1) during the day. Additionally, patients may have received concomitant treatment with stable doses of a dopamine agonist and/or an anti-cholinergic drug. After a four-week levodopa dosage stabilization phase, study participants were randomized to one of the three arms of the trial (1:1:1) to receive either one of two different doses of safinamide (50 or 100 mg once daily: 223 and 224 patients, respectively) or matching placebo tablets (222 patients), as adjunctive treatment to their levodopa therapy. The primary efficacy endpoint of the study was the increase in mean daily “ON” time (“ON” time without dyskinesia plus “ON” time with minor dyskinesia) during an 18-hour period as assessed by patients’ recordings on diary cards.

Out of the 669 randomized patients, 89% of patients treated with safinamide completed the study (91% in the 50 mg dose group and 87% in the 100 mg dose group) compared to 89% in the placebo group. Over 90% of patients who completed the initial 24 weeks of treatment elected to enter a 78-week, placebo-controlled double-blind extension study, which is ongoing, to specifically assess the effect on dyskinesias as primary endpoint.

Secondary efficacy endpoints of this study were also met, including decrease in daily “OFF” time, decrease in mean “OFF” time following first morning dose of levodopa, mean change from baseline in the Unified Parkinson’s Disease Rating Scale (UPDRS)(2) Section III (motor) score during “ON” time and mean change in Clinical Global Impression of severity of disease and change from baseline (CGI)(3). The incidence of dropouts, serious adverse events or clinically notable events among the three groups of the study were comparable.

Full study results after completion of ongoing analyses will be submitted for presentation at upcoming scientific meetings.

Merck Serono has exclusive worldwide rights to develop, manufacture and commercialize safinamide in Parkinson’s disease, Alzheimer’s disease and other therapeutic applications, as per the agreement signed with Newron in 2006.

About safinamide

Safinamide, an alpha-aminoamide derivative that is orally formulated, is currently being developed by Merck Serono and Newron as an add-on treatment for patients with Parkinson’s disease. Safinamide is believed to have a novel dual mechanism of action based on the enhancement of the dopaminergic function (through reversible inhibition of monoamine oxidase-B [MAO-B] and dopamine uptake) and reduction of glutamatergic activity by inhibiting glutamate release.

About Parkinson’s disease

Parkinson’s disease is a degenerative disorder of the central nervous system that often impairs the patient’s motor skills and speech. Parkinson’s disease belongs to a group of conditions called movement disorders. It is characterized by muscle rigidity, tremor, a slowing of physical movement (bradykinesia) and, in extreme cases, a loss of physical movement (akinesia). The primary symptoms are the results of decreased stimulation of the motor cortex by the basal ganglia, normally caused by the insufficient formation and action of dopamine, which is produced in the dopaminergic neurons of the brain. Secondary symptoms may include high-level cognitive dysfunction and subtle language problems. Parkinson’s disease is both chronic and progressive. It is estimated that more than 3 million people in the industrialized countries suffer from Parkinson’s disease.

About Merck Serono

Merck Serono is the division for innovative prescription pharmaceuticals of Merck, a global pharmaceutical and chemical group. Headquartered in Geneva, Switzerland, Merck Serono discovers, develops, manufactures and markets innovative small molecules and biopharmaceuticals to help patients with unmet medical needs. Its North American business operates in the United States and Canada as EMD Serono.

Merck Serono has leading brands serving patients with cancer (Erbitux(R), cetuximab), multiple sclerosis (Rebif(R), interferon beta-1a), infertility (Gonal-f(R), follitropin alfa), endocrine and cardiometabolic disorders (Glucophage(R), metformin); (Concor(R), bisoprolol); (Euthyrox(R), levothyroxine); (Saizen(R) and Serostim(R), somatropin). Not all products are available in all markets.

With an annual R&D expenditure of around EUR 1bn, Merck Serono is committed to growing its business in specialist-focused therapeutic areas including neurodegenerative diseases, oncology, fertility and endocrinology, as well as new areas potentially arising out of research and development in autoimmune and inflammatory diseases.

About Merck

Merck is a global pharmaceutical and chemical company with total revenues of EUR 7.1 billion in 2007, a history that began in 1668, and a future shaped by 32,458 employees in 59 countries. Its success is characterized by innovations from entrepreneurial employees. Merck’s operating activities come under the umbrella of Merck KGaA, in which the Merck family holds an approximately 70% interest and free shareholders own the remaining approximately 30%. In 1917 the U.S. subsidiary Merck & Co. was expropriated and has been an independent company ever since.

(1) “OFF” time refers to the times when people with Parkinson’s disease have a decrease in the ability to move (hypomobility) and other symptoms that cause difficulty rising from a chair, speaking, walking or performing their usual activities. “OFF” episodes occur because the person’s dose of levodopa has worn off or suddenly stopped providing benefit.

(2) The Unified Parkinson’s Disease Rating Scale (UPDRS) is one of the most widely used rating scales used to follow the course of Parkinson’s disease. It is made up of 44 items, scored from 0 to 4, to establish individual patients’ mental status, activities of daily living, motor function and complications of therapy. These are evaluated by interview and clinical observation. Clinicians and researchers alike use the UPDRS and the motor section (Section III) in particular to follow progression.

(3) The Clinical Global Impression (CGI) is the general name for two rating scales that are commonly used in clinical trials. The CGI-C scale measures the change in the patient’s clinical status from baseline. The CGI-S scale measures global severity of illness at a given point in time. Both CGI-C and CGI-S use a 7-point scale.

Source: Merck Serono

Popularity: 7% [?]