Yet another experimental drug heavily touted by Pfizer Inc. has foundered in advanced testing, raising worries about productivity problems at the world’s biggest drugmaker.

Safety problems with potential osteoarthritis treatment tanezumab, quietly disclosed Wednesday evening, on Thursday triggered a drop in Pfizer shares and a burst of notes to investors from analysts concerned about the trend.

“This is the second negative for (Pfizer) this week,” after the company pulled a cancer drug off the market, Miller Tabak & Co. analyst Les Funtleyder wrote. “We continue to have reservations about (the company’s) R&D capabilities and this announcement only confirms those.”

That’s after a highly anticipated Alzheimer’s drug flamed out in March, a failure doctors called a big setback because many hoped it might be the first treatment to stop or reverse the mind-robbing disease.

This Monday, New-York Pfizer said it was pulling bone cancer drug Mylotarg off the market 10 years after it got accelerated U.S. approval, because recent research found the drug increased chances of dying in patients also getting chemotherapy.

Late Wednesday _ at the urging of the Food and Drug Administration _ Pfizer said it was immediately suspending worldwide testing of tanezumab in patients with osteoarthritis, a common condition in which the cartilage lining joints deteriorates. Pfizer cited “a small number of reports” of patients who received the injected pain treatment having their osteoarthritis worsen, leading to joint replacement.

Just last week, two small companies developing other pain drugs in collaboration with Pfizer announced a total of three drugs, for osteoarthritis or rheumatoid arthritis, weren’t reducing pain as much as expected.

That all adds up to significant potential pain for Pfizer shareholders, who also have seen five late-stage studies of different cancer drugs fail in the last 18 months. In addition, Pfizer has sharply reduced its prized dividend, to help pay for its $68 billion acquisition of Wyeth last October.

On Thursday, Pfizer shares fell more than 3 percent, closing down 40 cents at $14.48, a big swing for a company with $68 billion in revenue.

“Biomedical R&D is one of the riskiest and most challenging businesses in the world,” said Pfizer spokesman Ray Kerins. “While our latest announcements demonstrate the risks and difficulties inherent in working with complex diseases, our pipeline demonstrates our ongoing commitment to focus on high-priority disease areas where there is significant unmet medical need.”

In this year’s biggest disappointment, Alzheimer’s treatment Dimebon, which Pfizer and partner Medivation Inc. were developing, failed to work in a late-stage study. That was after it had kept patient symptoms such as trouble with thinking and daily function from worsening for a year in a prior study.

Pfizer is continuing two other studies of Dimebon, one in combination with other Alzheimer’s drugs and taken for a longer period, and one in patients with Huntington’s disease, so it might still salvage the drug.

Likewise, Pfizer said it is still testing tanezumab in 17 studies for pain due to conditions other than osteoarthritis, including cancer and lower back pain, nerve pain related to diabetes and interstitial cystitis, a chronic bladder inflammation. The company is to discuss the future of those studies soon with FDA officials.

UBS Securities analyst Marc Goodman said he was reducing his sales forecast for tanezumab from $325 million to $200 million in 2015.

“We wouldn’t be surprised if we eventually have to remove all sales,” Goodman wrote.

Leerink Swann analyst Seamus Fernandez did exactly that, eliminating the $525 million in sales he expected in 2016.

He called the tanezumab news “yet another” late-stage pipeline failure and further evidence of Pfizer’s “R&D productivity challenges.”

Since acquiring Wyeth, Pfizer has significantly pruned their combined research portfolio, eliminating many programs no longer considered priority areas or where early results didn’t justify large, very expensive studies in patients.

Now Pfizer desperately needs some research successes, given that its $11.5 billion a year cholesterol blockbuster Lipitor will see sales plummet when it starts getting generic competition at the end of 2011. Sales are already down from Lipitor’s $13 billion peak because insurers and cash-strapped patients are turning to generic versions of similar drugs.

Meanwhile, at least eight other Pfizer drugs that are big sellers with high profit margins also will face generic competition in the next few years, BernsteinResearch analyst Tim Anderson notes.

Pfizer has just over 25 prescription drugs with enough revenue to report their individual sales. The company also gets well over $11 billion a year in revenue from many drugs with lower sales and from partnerships with other companies, plus several billion a year from sales of animal health, consumer health and other products.

Pfizer now spends roughly $9 billion a year on research and development, according to Anderson. That’s about 13 percent of its annual revenue.

“Investors should expect _ and demand _ that a certain level of pipeline progress will be made,” he wrote.

Updates 20th paragraph to add detail on number of prescription drugs and other revenue sources.

Source: wtop.com

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Top Pfizer Inc research executive Martin Mackay has left the world’s biggest drugmaker to head research at rival AstraZeneca Plc as both companies brace for patent expirations on their top-selling medications.

Pfizer will consolidate its research and development under Mikael Dolsten, who had worked with Mackay as co-head of research and development since October in a split of duties created from the company’s $67 billion merger with Wyeth.

Pfizer is betting on drugs from Wyeth, where Dolsten served as research head, to help it endure plunging sales of its Lipitor cholesterol fighter when the world’s top-selling drug faces generic rivals late next year.

Pfizer said Mackay, a soft-spoken and personable native of Scotland, had resigned and left the company “immediately.” He will take on the new role of president of R&D at London-based AstraZeneca on July 1.

Mackay had been the company’s global research chief for two years and, after the Wyeth merger, led PharmaTherapeutics research at Pfizer, involving conventional drugs made from chemicals. Dolsten oversaw research of BioTherapeutics, biotech drugs made from complex proteins grown in living cells.

“That structure was unusual,” Leerink Swann analyst Seamus Fernandez said. “It struck me as potentially a vetting period for Dolsten,” to better assess his leadership skills.

Morningstar analyst Damien Conover said Dolsten is not well known by Wall Street and will be under pressure to galvanize Pfizer’s underperforming laboratories.

Wyeth brought Pfizer currently marketed biotech drugs, such as blockbuster arthritis drug Enbrel, but did not greatly remedy Pfizer’s dearth of drugs in late-stage testing.

“So Dolsten has a pipeline that is not as strong as it needs to be to offset Lipitor’s patent loss,” Conover said. He noted, however, that Pfizer is developing treatments for Alzheimer’s disease, arthritis and blood clots that have blockbuster sales potential should they eventually be approved.

Shares of Pfizer were up 1.5 percent to $15.29, while AstraZeneca fell 0.8 percent, both in afternoon trading on the New York Stock Exchange.

R&D PEDIGREE

Dolsten has a medical degree from the University of Lund in Sweden and led drug research for Germany’s Boehringer Ingelheim before joining Wyeth. He also had senior roles with other drugmakers, including AstraZeneca and Pharmacia & Upjohn.

“Anyone in leadership in R&D at Boerhinger Ingelheim, which has been an incredibly productive R&D organization over the last several years, should probably be viewed reasonably positively,” Fernandez said.

Pfizer itself has produced few big drugs since introducing anti-impotence pill Viagra in 1998, despite its later acquisitions of U.S. rivals Warner-Lambert and Pharmacia and an industry-topping annual $8 billion research budget.

“The Wyeth deal buys Pfizer a little more time after Lipitor’s patent expires, but the company really needs to start kicking out some new drugs,” said Miller Tabak analyst Les Funtleyder. “Otherwise, it will have to change direction, and move deeper into related areas of healthcare such as generics or consumer products.”

For its part, AstraZeneca separated the two stages of R&D by having a head of drug discovery and a head of drug development, leaving some investors uncertain about its focus.

Mackay’s appointment brings the two roles together as the company overhauls R&D to prepare for patent expiries on top drugs like Nexium, for acid reflux, and Seroquel, for schizophrenia.

AstraZeneca spokesman Neil McCrae said a unified head of R&D would speed up decision-making and help allocate resources between different projects at a time of major change.

“We set out our strategy for R&D in January, which calls for some significant changes as we seek to improve the productivity of our pipeline,” he said. “In addition, since the acquisition of MedImmune, it has become clear that we need a single point of accountability to manage the entire R&D portfolio.”

Mackay has extensive experience working on both sides of the Atlantic. Prior to joining Pfizer in 1995, he focused on research into central nervous system diseases at Ciba-Geigy, now part of Novartis AG. (Reporting by Ben Hirschler and Ransdell Pierson; additional reporting by Lewis Krauskopf; editing by Michele Gershberg and Gerald E. McCormick).

Source: FOREXPROS.com

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Not exactly a win-win, but better than a win-loss: Eli Lilly got court backing for its compound patent on Gemzar, one of its top-selling products. That ruling will keep Teva Pharmaceutical Industries–and other copycats–off the market until Nov. 15.

But that court also ruled that Lilly’s method-of-use patent on Gemzar can’t be enforced on Teva, at least not now. That’s because the patent was declared invalid in a different federal court, pending an appeal set to be heard May 7, Lilly says in a statement. That patent might have protected Gemzar from generic competition until 2013.

And might still, SVP and General Counsel Robert Armitage says in a statement. “We … remain optimistic that a successful appeal of the Michigan decision on the Gemzar method-of-use patent will retain U.S. exclusivity for Gemzar into 2013.” And some analysts theorize that the Michigan court might agree. Leerink Swann analyst Seamus Fernandez says that if Lilly wins that appeal, he’ll boost his 2011 revenue forecast by up to $500 million.

Source: FiercePharma

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Three cancer treatments prove to be ineffective

One week after announcing that a promising drug targeting Alzheimer’s disease had failed to deliver hoped-for results, Pfizer Inc. said three potential cancer treatments had either failed or been terminated in late-stage studies.

The New York-based drug firm, with research-and-development offices in Groton and New London, said late Thursday that it had stopped a lung cancer trial involving the monoclonal antibody figitumamab after outside monitors determined the experimental drug wasn’t likely to demonstrate effectiveness.

Pfizer also said two late-stage studies of Sutent, known generically as sunitinib malate, did not help patients with advanced breast cancer.
The drug failures fell on the heels of an announcement last week that Pfizer’s promising Alzheimer’s drug Dimebon had shown no effect in two separate studies. Pfizer’s campuses in Groton and New London were involved in the development of Dimebon, but the company’s oncology research is headquartered in California.

“Pfizer remains committed to the development program for sunitinib and is continuing to study its potential role in the treatment of other solid tumors,” the company said in a statement, including lung, liver, prostate and bladder cancer.

Sutent’s results in treating advanced breast cancer were similar to those seeen in late-stage trials on advanced colon cancer patients. A colon-cancer trial using Sutent ended last year when the drug was found to be no more effective than standard chemotherapy.

Sutent already has been OK’d for treating advanced kidney cancer and stomach tumors.

Pfizer said it would continue looking into figitumamab to treat prostate, breast and lung cancers as well as Ewing’s sarcoma.

Each failure falls heavily now, as Pfizer counts the days until the November 2011 patent expiration for cholesterol drug Lipitor, the leading medication of all time. But analysts said they were not particularly surprised by the cancer-drug failures.

“We had assigned a low probability of success to these compounds,” said Les Funtleyder, a healthcare analyst for Miller Tabak & Co. in New York City, in a note to investors. “Nevertheless it does remind investors of continued woes in Pfizer’s R&D franchise which will need to be corrected.”

Seamus Fernandez, an analyst with Leerink Swann in Boston who projects Sutent sales of $2.5 billion by 2016, said “we were generally cautious on commercial prospects for Sutent in breast cancer given its side effect profile.” He added that Leerink Swann had removed potential figitumumab sales from its projections in October 2009 after Pfizer announced the halt of a lung cancer study involving the experimental medication.

“We … are skeptical on prospects for figitumumab,” Fernandez said.
Skepticism crept into Pfizer’s stock-market performance as well. The company’s stock, which had been riding high earlier in the year, ended trading Friday on the New York Stock Exchange at $17.08, down 1.2 percent on the day and off more than 6 percent on the year.

Source: The Day by Lee Howard

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Earnings forecast is lower than expected, sending shares down 4%

Can Eli Lilly and Co. keep its sales and profits from plunging off the edge of a cliff in two years? Wall Street apparently doesn’t think so.

Investors dumped 21.2 million shares of the Indianapolis drug maker’s stock Monday, the highest amount in more than two years, after the company suggested that earnings could dip after its biggest products lose patent protection starting in 2011.

That sell-off pushed the stock price down 4 percent, to $35.02 a share, even as the broader markets rose slightly.

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Lilly executives took pains to say the company’s pipeline is full and could produce two new medicines a year, beginning in 2013. But investors have heard similar reassurances before and seemed to be running out of patience.

And some said that even if Lilly achieves its goal, the new medicines will not make up for a wave of drugs whose patents will expire before then.

“Although Lilly had a growing midstage pipeline, these assets remain several years away from the market,” said Chris Schott, a drug industry analyst at JP Morgan in New York, in a research note. He predicted that Lilly’s profits will fall by a “meaningful” degree from 2012 to 2015.

Lilly has been struggling to develop new medicines lately, launching just one in the past four years — the blood thinner Effient, and that is off to a slow start.

The company’s late-stage pipeline includes new medicines for cancer, Alzheimer’s disease and diabetes. The company also hopes to launch a long-acting version of Byetta for diabetes.

Analysts are not sold that Lilly can suddenly begin to launch new products after such a long dry spell, or that new products will make a big difference.

“Effient’s launch has been relatively unimpressive,” Seamus Fernandez, a drug analyst at Leerink Swann in Boston, said in a research note. He added he remains cautious on prospects for speedy government approval of long-acting Byetta.

In recent years, Lilly has been stung by one disappointment after another in its laboratories. Late-stage, experimental drugs for brain cancer, multiple sclerosis, osteoporosis and other ailments have failed to live up to expectations and ended up on the scrap heap.

Now, Lilly’s top-selling drugs, including the antipsychotic Zyprexa, antidepressant Cymbalta and cancer drug Gemzar, will lose patent protection in a wave between 2011 and 2014, allowing competitors to offer low-cost generic alternatives. Lilly must quickly find a way to replace those products, which account for more than 60 percent of revenues.

John Lechleiter, president and chief executive of Lilly, said the company has cut costs, become more productive, speeded up its business model and invested heavily in research and development.

In September, the company said it would cut 5,500 jobs, or 13.6 percent of its worldwide work force, by the end of 2011. On Thursday, the company said it has cut about 25 percent of its sales force this year.

Lechleiter again ruled out a large-scale merger or acquisition as a solution, saying Lilly could compete while remaining independent.

“We’re betting on our scientists and our scientific leaders and the deep insights and advanced technologies increasingly at their disposal,” he told analysts during the company’s annual investor conference in New York City.

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The company said it has 62 compounds in development, including 25 in midstage and late-stage clinical testing. Dr. Steven Paul, Lilly’s top research executive, said the company now has “the strongest pipeline in our history.”

The company said it moved into ninth place worldwide for pharmaceutical sales in the 12 months that ended in June, according to data from IMS Health.

The company said it expects annual revenue of at least $20 billion in the years 2012 to 2014 and beyond. Wall Street has been expecting company revenue in 2011 of about $22.9 billion, Reuters reported. Lilly had revenue of $20.4 billion last year.

Lilly expects to earn $4.65 to $4.85 per share next year, excluding the potential impact of health-care reform. That range represents growth of 6 percent to 13 percent, compared to the company’s profit guidance for this year. Analysts were expecting earnings of $4.74 per share for 2010.

Source: Indystar.com

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Last week we reported that a debt-refinancing at Mead Johnson yielded $1.75 billion in cash for parent Bristol-Myers Squibb. But that’s just a fraction of the some $6.5 billion Bristol could net from a planned spinoff of that nutritionals business. All together, the $8 billion-plus would be a nice war chest for the sort of biopharma deals CEO James Cornelius likes.

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The spinoff would take Bristol all the way back to its core business: drugs. “By executing our healthcare divestment strategy, we have sharpened our BioPharma focus, improved the overall financial strength of the company and supported our ability to pursue strategic business development opportunities,” Cornelius said in a statement. “With the successful execution of this split-off, we fully consider ourselves a BioPharma company.”

But is that intense focus good or bad? Depends on who’s talking. Cornelius, obviously, calls it a good thing. But other Big Pharma CEOs have been intent on going the opposite direction, making deals in animal health, consumer health, and eye care in an effort to diversify beyond prescription drugs. Leerink Swann analyst Seamus Fernandez said the deal will make it even more important for Bristol to deliver drug sales. “The company still has to execute as a pharmaceutical company,” he told the Wall Street Journal.

Source: FiercePharma

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Merck, maker of the Maxalt migraine drug, has been betting heavily on adding a new medicine to its lineup aimed at the multibillion-dollar migraine market. The company has been planning to ask the FDA this year to approve the medicine, telcagepant, and analysts predicted the drug could have $800 million or more in sales in 2015. Analysts considered telcagepant one of Merck’s key new products.

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But the drug maker announced this morning that it would delay taking telcagepant to the FDA, and one analyst wondered whether the drug would ever make it. “It is fully conceivable that this product will be terminated,” Sanford Bernstein’s Tim Anderson wrote in a note to investors.

The problem: some patients participating in an exploratory study gauging whether the drug could be taken daily to prevent migraines developed high levels of liver enzymes. The company stopped the study and is reviewing data from another study, said Peter Kim, Merck’s research chief. Meantime, it is moving ahead with studies of the drug’s intermittent use to treat migraine attacks.

Merck disclosed the telcagepant news in announcing disappointing financial results for the first quarter.

The struggles are another reminder of the unpredictability of drug research and development, and the difficulties that Merck and other big pharmaceutical companies have had finding lucrative new drugs to replace the blockbusters losing patent protection over the next several years.

More than a third of Merck’s revenues come from drugs whose patents run out through 2013, according to Edward Jones’ Linda Bannister. The depth of its “patent cliff” is so steep that Merck, which had prided itself on its homegrown research, is now inking drug development deals with outside firms. More telling, it agreed to buy Schering-Plough for $41.1 billion.

Seamus Fernandez, a Leerink Swann analyst, told the Healh Blog that the telcagepant news — combined with its poor first-quarter performance — “increases the importance of a successful merger outcome.” In a conference call with analysts, Merck officials said the merger, slated for completion in the fourth quarter, was on track.

Source: The Wall Street Journal

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Eli Lilly reported at the International Congress on Schizophrenia Research that Phase II study results of its experimental schizophrenia treatment LY2140023 were “inconclusive,” due to a greater-than-expected response in patients taking placebo. The company said it plans to undertake an additional mid-stage study on the compound next year, and it explained that the decision to continue development is based in part on previously announced data for the drug.

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The most recent trial enrolled 669 patients with acute schizophrenia, 393 of whom completed the four-week study. A primary analysis showed that none of the four doses of LY2140023 administered twice daily “separated from placebo.” In addition, Eli Lilly noted that for patients who took the comparator drug Zyprexa (olanzapine) once daily, Zyprexa did not separate from placebo. The drugmaker said the higher-than-expected placebo response was approximately double what has typically been observed in schizophrenia clinical trials.

Regarding side effects, findings showed that LY2140023 had a “low association” with adverse events commonly linked with current antipsychotic treatments, and that patients taking LY2140023 showed no appreciable weight gain. However, Eli Lilly also indicated that convulsions were observed in three patients taking its experimental mGlu2/3 receptor agonist.

Commenting on the news, Steven Paul, president of Lilly Research Laboratories, stated that the company “remains optimistic that the novel mechanism of compounds with the ability to reduce glutamate hyperactivity…will someday represent the next generation of breakthrough treatments for schizophrenia.” However, Leerink Swann analyst Seamus Fernandez described the data as a “serious blow” to Eli Lilly’s pipeline, saying that “any additional studies [with LY2140023] should be viewed as exploring the mGlu2/3 mechanism, but the agent should not move forward into Phase III studies due to safety concerns.”

Source: FirstWord

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