In response to this article, I would like to point
out a couple of things.
I am sure you can verify what I am saying with either
Mike Jones, Biogen Rep or any reliable neuro like
Dr. Kraft etc. First this so called clinical trial that
is referred to in this article, is really not a scientific trial in that
the patients who participated were able to
"pick" which drug the used and also in the fact that there
was no set definition of what constituted a relapse.
From what I have heard, the neuros that attended this presentation laughed
at this guy that presented it and
were also angry in that the dr presenting was paid $100,000
by Teva Marion--so--if that is the case, which drug should
he say is the most effective? Both Biogen and Berlex were amazed by the
steps of Teva to "outshine" the other drugs. I am also attaching an
analysis by a non-biased (not from any drug company) analyst that attended
this presentation. I
hope that you can pass this on to others.
A study is being presented today in a poster session at the
ANA that compares the effects of Avonex (Biogen), Betaseron
(Chiron/Berlex), and Copaxone (Teva) in treating relapsing remitting
multiple sclerosis. The study was performed by
Dr. Omar Khan of Wayne State University.
We provide details of the trial below, but on the whole, we believe this
study is scientifically flawed in several respects. We do not believe any
conclusion can be drawn from this study regarding Avonex's
superiority/equivalence relative to its competition, despite data showing
that Avonex failed to show a statistically significant benefit in reducing
relapses. Neurologists should not take this study seriously, and we do not
foresee any changes in treatment or prescribing practices as a result of
the trial. We would be aggressive buyers on any weakness associated with
Study Flawed in Many Ways
The study conducted by Dr. Khan was scientifically flawed in several
respects, in our opinion, and therefore prevents us from drawing any
meaningful conclusions from the data. The trial enrolled only a small
number of patients (n=156) and divided them into four arms: standard
therapy with Avonex, Betaseron, or Copaxone, or a no-treatment control
group. This provided only approximately 40 patients per treatment group.
This could significantly skew trial results based on just one or two
outliers in any given cohort.
The trial was non-randomized and open label. Patients in this study were
allowed to choose which therapy they wanted to use. This is never allowed
in a rigorous clinical trial. This, along with the open-label nature of
the study, provide significant opportunity for the introduction of bias
into the trial.
There was no established definition of a relapse, which left the
interpretation up to the investigator. This allows for additional
Disagree with Study Conclusions
Not only are the methods used in this trial flawed, in our opinion, so are
the investigator's conclusions. The data from the trial do show that
Copaxone and Betaseron provide a statistically significant reduction in
relapses at 12 months while Avonex does not. However, Dr. Khan goes on to
state that "although non-randomized and open-label, the results of this
trial are similar to the results in the traditional randomized,
placebo-controlled studies." We disagree.
In pivotal clinical trials, Avonex did demonstrate a statistically
significant reduction in relapse rates. In contrast, in the larger of two
Phase III trials of Copaxone, Teva's drug failed to show a significant
reduction in exacerbations. Therefore, the results of large, blinded and
controlled clinical trials appear to refute the findings in Dr. Kahn's study.
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01:13pm EDT 13-Oct-99 PaineWebber (Wang, Elise T. 212-713-1079) BGEN CHIR
TEVA Biotechnology: Multiple Sclerosis Mkt--September Data
Biotechnology PaineWebber Elise Wang RESEARCH NOTE
212-713-1079/WangE@painewebber.com Weidong Huang, Ph.D., Associate Analyst
(212-713-4982) October 13,
1999 Jennifer Chao, Associate Analyst (212-713-2589)
Biotechnology: Multiple Sclerosis Mkt--September Data KEY POINTS
* Prescription trend continues to support growth in Avonex sales. Total
scrips for Avonex posted strong growth of 33.5% on a year-to-year basis in
September, consistent with the record sales of Avonex ($116 million in the
U.S.) that Biogen recently reported for Q3 1999. We expect this growth
trend to continue throughout the rest of the year. In the aggregate, our
1999 sales projection is $619 million (57% year-to-year growth) and
consists of U.S. sales of $443 million (46% year-to-year growth), and
European sales of $176 million (93% year-to-year growth). For fiscal 2000,
our Avonex sales projection is $812 million (31% year-to-year growth) and
consists of U.S.
sales of $574 million (30% year-to-year growth), and European sales of $239
million (36% year-to-year growth).
* Reiterate Buy rating on Biogen (BGEN-$79.00, Buy)(2). We believe
concerns on a study comparing Avonex, Betaseron and Copaxone being
presented at a medical meeting today are overblown and recommend buying
BGEN on any stock weakness.
We expect Avonex will continue to drive strong growth in product sales and
earnings of Biogen. Furthermore, we expect enhanced visibility on the
company's pipeline as Amevive for severe psoriasis is expected to progress
into Phase III studies by year-end. Detailed data from a large Phase II
study are expected to be released in early December at a medical meeting in
London. Our 12-month price target is $105 based on a low-50s multiple or
PEG of 1.6x to our 2001 EPS estimate of $2.02.
* Renewed growth in Betaseron. Total scrips for Betaseron grew 13.6% on a
year-to-year basis in September. We believe that off-label use of
Betaseron in secondary progressive multiple sclerosis (MS), supported by
positive clinical data, has been driving the renewed growth in sales of
Betaseron since the beginning of this year. With the recent
earlier-than-expected termination of the U.S. study, we believe the
expanded label for this indication may be approved by year-end. For Q3 99
and fiscal 1999, we estimate end-user sales of Betaseron of approximately
$126 million and $487 million, respectively, and an EPS of $0.14. Chiron
is scheduled to report after market close on Wednesday, October 27th.
* Maintain Neutral rating on Chiron (CHIR-$29.19, Neutral)(2). We believe
CHIR is fairly valued at current price levels and look for a potential
product/company acquisition or the advancement of lead products to alter
STRONG SCRIP DATA FOR AVONEX IN SEPTEMBER
* For the month of September 1999, Avonex prescriptions were as follows:
* Total prescriptions were 31,765 compared with 23,843 in September 1998
representing year-to-year growth of 33.5%. *
* New prescriptions were 7,719 compared with 7,366 in September 1998
representing year-to-year growth of 5.1%. *
* Refills were 24,046 compared with 16,477 in September 1998 representing
year- to-year growth of 46.2%. *
* Solid market leadership position. Avonex's dominant market share, at
56.8%, indicates the product is capturing a significant portion of the
expansion in the multiple sclerosis market.
* Strong growth in overall multiple sclerosis market. Robust growth in the
overall multiple sclerosis market is reflected in year-to-year growth of
33.5% and 12.8% for total and new scrips, respectively. The relatively
modest year-to-year growth in new scrips in September 1999 is due to the
exceptionally strong new scrips in September 1998. We believe a trend
towards earlier treatment with interferons is driving robust growth in the
RENEWED GROWTH IN BETASERON
* For the month of September 1999, Betaseron prescriptions were up
significantly as follows:
* Total prescriptions were 12,888 compared with 11,372 in September 1998
representing year-to-year growth of 13.6%. *
* New prescriptions were 3,320 compared with 2,791 in September 1998
representing year-to-year growth of 19.3%. *
* Refills were 9,568 compared with 8,581 in September 1998 representing
year- to-year growth of 11.8%. *
* Market share stabilized. With a renewal of growth in prescription
activities, the decrease in Betaseron's market share has slowed down
significantly in 1999. Betaseron accounted for 23.1% of the MS market in
total scrips in September 1999, compared to 25.0% in January 1999.
* Renewed growth supported by positive data in secondary progressive MS.
We attributed the renewed growth in Betaseron scrips to the publication of
positive clinical data supporting its use in secondary progressive MS and a
subsequent label expansion to include this indication in Europe. Based on
data from pivotal European trials, Berlex/Chiron filed for an expanded
label of Betaseron to include secondary-progressive MS in the U.S. in June
Although the label expansion has yet to be granted by the FDA, we believe
that there may be a substantial amount of off-label use that is
contributing to the resurgence in prescription growth for Betaseron.
The pivotal U.S. trial of Betaseron in secondary progressive MS was
recently stopped by an Independent Monitoring Board (IMB) who recommended
that all patients enrolled in the study be given the opportunity to receive
Betaseron at the currently approved dose. We believe this implies the
results of this study are likely to be positive. Clinical investigators
will continue to compile data from this trial throughout the remainder of
the year. In our opinion, the FDA may grant a label expansion in this
indication for Betaseron in H1 2000 upon review of the results of the U.S.
UPDATE ON COMPETITION
* Teva Marion Partners' (TMP) (TEVA-$50.50, Not Rated) Copaxone continues
to demonstrate solid although decelerated growth in scrips with a 20.1%
market share. Despite the in-roads that Copaxone has made in the U.S.
market, we believe that the drug will still be used primarily as a salvage
therapy for MS patients who do not respond to interferon therapies due to
its less robust efficacy.
* A comparative study led by a clinician at Wayne State University is being
presented at the annual American Neurological Association meeting in
Seattle, Washington today. This study compared 156 relapsing-remitting
multiple sclerosis patients treated with Avonex, Betaseron, Copaxone or
placebo based on EDSS score (neurological measurements) at 12 months. The
results described in the poster indicated a statistical significant
reduction in EDSS response with Betaseron and Copaxone and not with Avonex
at 12 months.
In our opinion, this study is inadequate to support superiority of Copaxone
and Betaseron to Avonex given that it was not randomized nor was it blinded.
In addition, no sustained and confirmed evidence of response was provided
since data was presented at only 12 months. All previous pivotal studies
of these MS drugs were conducted over at least two to three years and
demonstrated sustained response in slowing progression of disease.
Furthermore, there is overwhelming clinical experience with Avonex
demonstrating its superiority.
We believe the clinical study was sponsored by Teva Pharmaceuticals, the
manufacturer for Copaxone. In addition, Teva's public relations firm will
be holding a press conference today at noon (EST) with a likely press
release prior to this meeting. In our opinion, we would recommend buying
BGEN on any sign of stock weakness.
* Ares Serono's failure to obtain U.S. marketing approval for Rebif, its
version of beta interferon, has essentially assured the continued dominance
of Avonex in the U.S. market. Although Ares Serono recently announced
that it will be initiating a head-to-head study of Rebif to Avonex with the
objective of potentially showing better efficacy with high doses of Rebif
versus Avonex, we believe this study lacks comparable endpoints and that
the duration of follow-up is likely to be too short (one year) to be
acceptable to the FDA.