Industry Trend Analysis - Novartis On Track To Remain A Leader In MS - FEB 2018


BMI View: Within the multiple sclerosis (MS) drugs arena, Novartis is facing the arrival of generic Gilenya and competition from Celgene's ozanimod, a likely blockbuster drug of the future . Novartis is looking to sustain its leadership in this disease area , and is pursuing paediatric and secondary progressive MS, which represent areas of unmet need . A paediatric indication for Gilenya would extend the drug ' s lifecycle, meanwhile pipeline products will help to offset revenue losses as Gilenya succumbs to competition.

With Novartis facing the market entry of Celgene's rival sphingosine 1-phosphate (S1P) receptor modulator ozanimod in 2018 and generic Gilenya (fingolimod) in 2019, the firm appears set to lose multiple sclerosis (MS) market share. However, it is looking to remain competitive, and is targeting paediatric MS and secondary progressive MS (SPMS), two areas of unmet need.

Novartis Pursues Paediatric Indication For Blockbuster Gilenya

Novartis' Gilenya, an S1P receptor modulator, was the first oral drug for MS, gaining FDA approval in September 2010. It has proved a blockbuster product for the company, with 2016 net sales of USD3,109mn, which comprised 84.6% of Novartis' total neuroscience sales. As a result, the arrival of generic competition will mean a significant loss of revenue.

Currently there are no disease-modifying therapies specifically approved for children and adolescents with MS, and Novartis is pursuing a paediatric indication for Gilenya, which would extend the drug's lifecycle. This effort has received a boost, with the FDA having granted breakthrough therapy designation for Gilenya for the treatment of children and adolescents 10 years of age or older with relapsing MS. The designation is based on data from the Phase III PARADIGMS study, which evaluated the safety and efficacy of Gilenya versus interferon beta-1a in children and adolescents (ages 10 or older) with relapsing MS. PARADIGMS, the first completed randomised, controlled clinical trial specifically designed for paediatric relapsing MS, found that treatment with Gilenya resulted in an 82% reduction in the rate of relapses (annualised relapse rate) in this patient population over a period of up to two years, compared to interferon beta-1a intramuscular injection (p<0.001). The safety profile of Gilenya in this study was overall consistent with that seen in previous clinical trials in adults.

As Well As Generics, Celgene's Ozanimod Will Also Drive Down Gilenya Sales

Celgene, which is more commonly known for its haematological cancer heritage, is moving closer to entering the MS drugs market. It is developing ozanimod, an investigational oral, selective S1P 1 and 5 receptor modulator, for immune-inflammatory indications including relapsing MS, ulcerative colitis and Crohn's disease.

Celgene has previously indicated that it anticipates filing regulatory submissions in the US by the end of 2017 and in the EU in H118. If ozanimod is approved for relapsing MS, it will be a relative latecomer to the oral MS drugs market, but ozanimod's differentiating factor looks to be its safety profile. Like ozanimod, Novartis' Gilenya is an S1P receptor modulator. Gilenya reduces relapse rate, however it may cause serious side effects such as a slow heart rate, especially after the first dose; an increased risk of serious infections; progressive multifocal leukoencephalopathy; macular oedema; swelling and narrowing of the blood vessels in the brain; breathing problems; liver problems; increases in blood pressure; and basal cell carcinoma. Indeed, patients need to have their heart rate monitored for six hours after the first dose because their heartbeat may be slowed. Thus an improved safety profile could see ozanimod take market share from Gilenya and Celgene's ozanimod is a likely blockbuster drug of the future. However, it must also be noted that generic versions of Gilenya, which are anticipated in the US market in 2019, will not only drive down revenues of the branded drug, but also reduce the peak annual sales potential of ozanimod.

New MS Drugs Will Help To Offset Gilenya Losses

There is a high unmet need for new treatments for SPMS patients, as there are very few available proven to be effective with an acceptable safety profile. Novartis' siponimod (BAF312) is an investigational, scientifically designed selective modulator of specific subtypes of the S1P receptor. Siponimod binds to the S1P1 sub-receptor on lymphocytes and promotes their retention in lymphoid tissues, which prevents them from entering the central nervous system (CNS) of patients with MS. This leads to the anti-inflammatory effects of siponimod.

The S1P receptor subtypes targeted by siponimod are also found on the surface of cells in the CNS, which play a role in the origin of SPMS. Siponimod enters the CNS and by binding to these specific receptors, has the potential to modulate damaging cell activity and help to reduce the loss of neurological function associated with SPMS. The receptor specificity and pharmacokinetic properties (eg, the faster elimination compared with first-generation S1P modulators) of siponimod facilitate its ability to impact diseases such as SPMS, while improving its safety and convenience profile. Novartis anticipates a US filing for siponimod in H118 and EU filing in H218, with an expected launch in 2019, and the drug is a potential blockbuster.

Novartis also has in its pipeline OMB157 (ofatumumab), a fully human monoclonal antibody under investigation in relapsing MS that suppressed >90% of new MS lesions in the brain as measured by MRI [1]. OMB157 targets CD20, and is currently being investigated in two Phase III pivotal studies, with a planned filing in 2019 and expected launch in 2020.

New MS Drugs To Offset Lost Gilenya Sales For Novartis
Annual Product Sales (USDmn)
e=estimate. Source: Bloomberg, BMI

With its FDA approval on March 28 2017, Roche's Ocrevus (ocrelizumab), a B-cell-depleting antibody, became the first and only medicine for both relapsing and primary progressive forms of MS. Administered by intravenous infusion every six months, Ocrevus is a humanised monoclonal antibody designed to selectively target CD20-positive B-cells, a specific type of immune cell thought to be a key contributor to myelin (nerve cell insulation and support) and axonal (nerve cell) damage. This nerve cell damage can lead to disability in people with MS. Based on preclinical studies, Ocrevus binds to CD20 cell surface proteins expressed on certain B-cells, but not on stem cells or plasma cells, and therefore important functions of the immune system may be preserved. B-cell depletion is an efficacious new weapon for tackling MS. This approach is gaining traction and following the recent FDA approval of Roche's Ocrevus, more such therapies will move through the pipeline.

[1] https://www.novartis.com/sites/www.novartis.com/files/2017-11-r-d-day-investor-presentation.pdf