Good news for Novartis's MS drug fingolimod

Swiss drug major Novartis has revealed that data from a two-year, late-stage study showed that its oral drug FTY720 (fingolimod) was significantly superior to placebo in reducing relapses and disability progression in patients with relapsing-remitting multiple sclerosis (MS).

The double-blind placebo-controlled study, called FREEDOMS (FTY720 Research Evaluating Effects of Daily Oral therapy in Multiple Sclerosis), involved 1,272 patients in 22 countries and assessed the efficacy, safety and tolerability of FTY720. The study revealed that FTY720, which was well tolerated, reduced the relapse rate by 54% for the 0.5mg dose and 60% for the 1.2 mg dose compared to placebo.

Furthermore, the candidate reduced disability progression by 30% for patients on 0.5mg and 32% for those on 1.2mg compared to placebo over the entire duration of the study, thus meeting the primary and secondary endpoints for both the doses, with no significant difference in efficacy.

The incidence of adverse events was much lower in the 0.5mg dosage. Consequently, the company intends to seek approval for the lower dose of the drug in the US and the European Union at the end of this year. Additionally, all further developments of FTY720 in relapsing forms of the disease will be focused on the 0.5mg dose.

Will compete with Biogen products, Zacks analysts note

Commenting on the news, analysts at Zacks Equity Research noted that, once launched, FTY720 will compete primarily with Biogen Idec, which is the market leader in therapies to treat MS. Biogen's leading product is Avonex (interferon beta-1a), which recorded sales of $2.2 billion, up 18% from 2008. The company's other MS product, Tysabri (natalizumab), continued to see an increase in patient growth despite carrying a black-box warning for the risk of progressive multifocal leukoencephalopathy (PML) and other cautionary language.

Biogen is working on consolidating its position in the MS market and has an impressive late-stage pipeline of drugs including Fampridine-SR, a sustained release form of 4-aminopyridone, which is currently under review by the US Food and Drug Administration, the analysts observe. Besides Fampridine, the company has another interesting MS candidate, BG-12, which is currently undergoing late-stage trials.

However, they say, the market has huge potential as only about 36% of MS patients are currently treated with MS drug, a percentage which is expected to increase to 56% by 2014 as new oral MS therapies are launched. MS prevalence rate is higher in women than men. It is the fourth leading cause of disability among American women.

Novartis gets upgrade from Citigroup

Meantime, Novartis was upgraded to buy from hold by Citigroup, which cited factors such as an attractive respiratory portfolio and positive currency tailwinds. Citi also said sales of its high blood pressure drug Diovan (valsartan) would be stronger for longer, increasing the overall pharmaceutical margins for the group. The investment bank also doubled its assumed cost savings with the arrival of a new chief financial officer.