Month: November 2020

For years, industry watchers have wondered whether the U.S. biopharma business needed a jump-start as new launches languished and brands kept their dominant market positions. But Amgen’s latest quarterly results show there’s still plenty of potential for a dedicated player. Amgen’s biosimilars—a group that includes copycats to Roche cancer blockbusters Avastin and Herceptin—generated $480 million during the third quarter, the company said Wednesday. The franchise is now running at about a $2 billion-per-year rate, about double the revenue of last year, Bernstein analyst Ronny Gal pointed out on Wednesday’s call.

Despite the COVID-19 pandemic, the company has “done a really nice job …. establishing strong penetration into the U.S. oncology market,” Amgen’s executive vice president of commercial operations, Murdo Gordon, said on Wednesday’s call.

After earlier biosim launches were slow to gain steam, some experts wondered whether the U.S. would be better off giving up on the money-saving promise of biosimilars. Instead, they said, the government could regulate prices directly after biologic drugs lose exclusivity. Others, such as former FDA Commissioner Scott Gottlieb, M.D., said it was too soon to call it quits.

For his part, Gordon said it’s an “efficient market” and that “when there is a clear value on the table, healthcare systems, providers and payers are able to capitalize on it.”

“That’s what’s driving of course the uptake of our biosimilars,” he added.

Amgen’s situation is different from that of some companies marketing copycat biologics. The company has defended its own brands—such as white blood cell booster Neulasta—against biosimilar competition, and that effort has “positioned us well to understand how accounts are looking to purchase biosimilars,” Gordon said.

Further, Amgen has a “very effective provider-focused commercial presence,” the exec said, meaning the same Amgen sales reps who are discussing innovative drugs with doctors are also talking about biosimilars. The company has a patient services group that helps with reimbursement and co-pay assistance, too.

While uptake for Amgen’s oncology biosims has been stronger than the company initially expected, Gordon cautioned against making assumptions about its immunology biosimilar franchise. Amgen’s biosim to Johnson & Johnson’s Remicade has been on the market for under a year and hasn’t yet taken off. The company’s biosim to Roche’s Rituxan is set for a December decision at the FDA.

Looking forward, Bernstein’s Gal questioned whether Amgen expects to maintain its level of biosim growth next year. Gordon said the company can “continue to capture good volume albeit at some price erosion” as new competitors launch. Still, Amgen has “a lot of headroom for growth,” Gordon said.

Amgen’s results come several years after the first biosimilar launches in the U.S. Pfizer’s biosimilar to Remicade was among the early launches, hitting the market in October 2016 at a 15% discount to the brand. The copycat was slow to take off, and Pfizer sued J&J for “anticompetitive” contracting to protect its important brand. J&J hit back in a public statement that Pfizer wasn’t offering enough value to win business. This year, the lawsuit has been in the discovery process, according to law firm Goodwin.

Pfizer itself generated $424 million in sales for the biosim franchise during the third quarter. Back in August, Bernstein’s Gal wrote that the biosims market is entering a “golden age” and that the companies will generate billions of dollars in revenues from the market.

For Amgen, the biosimilar contribution helped propel the company to third-quarter revenue growth of 12% to $6.4 billion despite challenges associated with the pandemic. New immunology acquisition Otezla chipped in $538 million, while Enbrel’s quarterly haul was $1.33 billion.

When the COVID-19 pandemic began to sweep across the U.S. this year, early fears of shortages of critical pharmaceutical supplies and life-saving drugs were quickly abated by a responsive and resilient supply chain. As the crisis unfolded and the public’s attention was focused on shortages of everyday items like toilet paper, paper towels and disinfectants, patients with critical needs for treatments that ranged from insulin to inhalers also began to fret.

Manufacturers worried as well. Was the pharmaceutical industry prepared to meet the challenge? Particularly since—according to industry averages—between 70% to 80% of APIs (active pharmaceutical ingredients) are manufactured in China and roughly 40% to 50% of generic drugs are produced in India. On top of that were early shortages of protective equipment like face masks, face shields and gowns for front-line healthcare workers and other essential workers like associates at AmerisourceBergen’s distribution centers. AmerisourceBergen is one of the nation’s primary pharmaceutical wholesale distribution entities. The company picks, packs and ships nearly 4 million pharmaceutical and healthcare products daily and services more than 65,000 hospitals, pharmacies, physicians’ practices and clinics annually.

“Our family and friends used to say they didn’t really understand what we did every day,” Heather Zenk, Senior Vice President for Strategic Global Sourcing at AmerisourceBergen, said. “Now supply chain is something we talk about around the kitchen table.”

The immediate response from the company was to ensure that its front-line associates—primarily distribution center associates, patient-facing nurses and pharmacy staff—were monitored for health and provided the protective equipment they needed. If anyone across AmerisourceBergen could work from home, they were asked to do so.

Concurrent with those actions was a program to support front-line associates that provided day-care needs and paid time off for employees who either needed to quarantine themselves or their families. Additional steps included daily temperature checks, constant sanitization of warehouse sites that now utilize ultraviolet robots, and an app with Centers for Disease Control questions to help monitor associates’ health.

Having a good business continuity plan

“What served us, our partners and customers well was our ability to be resilient and have a nimble business continuity plan,” Erin Horvath, President of AmerisourceBergen’s Distribution Services, said. “We were able to handle certain circumstances like having to close a distribution center for a short period of time, divert product orders to another facility and still meet the needs of our customers.”

An example was the company’s closure for several days of its Newburgh, N.Y. distribution facility at the height of that state’s COVID-19 outbreak last spring although the site’s positive tests for the virus were very low.

“We saw associates were getting uneasy about coming in and we wanted them to know we cared and wanted to protect them, so we decided to close that center,” Horvath said. “We could take that action because we knew we had the network to support customers by servicing them through our other distribution centers.”

With a network of 33 human health and specialty distribution centers and 19 animal health distribution centers and depots nationwide and about 4,000 associates manning them, AmerisourceBergen was able to implement a robust business plan with a long track record of responding to other natural disasters like hurricanes, earthquakes and wildfires. Only, instead of day and weeks of response, the pandemic has persisted for months and will likely continue through the first half of next year.

That history of successful crisis response is supported by close partnerships with a variety of government agencies, as well as its relationship with Healthcare Ready, a Washington, D.C.-based nonprofit focused on supporting the healthcare supply chain by collaborating with government entities and the private industry sector.

Such collaboration between the private sector, government agencies and with non-profit health organizations will play an integral part as vaccines developed to fight COVID-19 start to become available in the coming months and year.

Partnerships across the board will be a key part when it comes to distributing and administering those vaccines, and both Horvath and Zenk agree that the centerpiece to a successful outcome has and will continue to be open and transparent communication.

“Early on, we knew to invest the time in that kind of communication so that everyone wasn’t fighting the same battle for resources,” Zenk said. “Because of that, we were able to respond to customers very honestly and quickly. We saw hospital customers changing therapies as they learned more about how to treat the virus; we were able to routinely check in with them on the therapeutics they needed most and start supporting them right away.”

Zenk also points out that with the attention mostly focused on the pandemic response this year there were about 20 launches of new oncological treatments. A clear indication that despite the immediate crisis, innovation in the pharmaceutical industry continues, and that innovation needed to be distributed to patients in the same manner they were accustomed to getting under normal circumstances.

Preparing for a vaccine rollout

As vaccines become available, they will initially be allocated to those most at risk like front-line health-care workers, essential workers and populations such as the elderly and people with co-morbidities. When a nationwide vaccine program is rolled out and begins to reach critical mass deeper into 2021 it will likely involve multiple manufacturers offering multiple treatments, all of which will need the strength of the full national supply chain and distribution system.

“Something of this scale has never been undertaken before,” Horvath said. “We are talking about a vaccine that includes two doses and requires frozen and ultra-frozen storage and transportation capabilities—and will need to be available to the entire population of the United States.”

AmerisourceBergen has extensive experience in managing ultra-low temperature products and is standing ready to support the vaccine distribution effort when needed, both Horvath and Zenk said.

Clearly it will involve an enormous effort by the government and private industry and will require independent neighborhood pharmacies, large retail pharmacies and physicians to have a voice in the project.

“We have invested hundreds of millions of dollars in our technology and in our distribution network in the last 10 years and in the past months we’ve seen that those investments pay off. They have given us the agility and resilience to do things in a very quick manner,” said Horvath.

“One of the great things I’ve observed during this time is how the national healthcare system has been working more like a community,” Zenk added. “A hospital in one region might say they are doing okay, but then ask us to make sure another hospital in another area that might be a hot zone gets what they need.”

Eli Lilly’s chances at an emergency use authorization for a COVID-19 antibody took a big hit after a major trial was stopped for safety concerns and the FDA flagged problems at a manufacturing site producing the therapy. Now, the FDA is back for more, and it could spell even bigger problems. Lilly could face an FDA warning letter after a follow-up inspection at the plant that showed “a major failure of quality assurance,” sources told Bloomberg. Located in Branchburg, New Jersey, the site is manufacturing Lilly’s COVID-19 antibody LY-CoV555, among other drugs.

An FDA warning letter, which signals continuing deficiencies at a drug manufacturing plant, would escalate the current “official action indicated” notice Lilly received for a previous FDA inspection at the site in November 2019.

In that notice, the FDA cited Lilly on two counts of inadequate “control of computer systems,” the drugmaker confirmed last week. The agency cited the plant for improperly deleting data on its manufacturing processes and failing to review quality-control audits, sources told Reuters.

Despite that earlier citation, FDA inspectors again found problems at the plant in August, Bloomberg reported, and is asking the agency to “take action.” The Branchburg site is one of five that produce the antibody, Lilly said in a Tuesday statement, and the FDA has yet to issue a warning letter to the drugmaker.

In response to the FDA’s findings in November, Lilly has added staff at the Branchburg site and hired an external consultant to review its data handling, the company said.

While Lilly maintains that the shortfalls flagged by the FDA haven’t affected the quality of its antibody, which the agency is reviewing for an emergency authorization, sources painted a different picture for Bloomberg.

Compliance officers conveyed one incident in which a Lilly employee used the wrong material in a “crucial” purification process, Bloomberg said. Employees also reportedly retested samples for impurities to get back a positive result and denied FDA investigators’ requests to review human resources documents related to potential data handling citations.

A Lilly spokesman refused to comment in an email on the specific allegations in the Bloomberg report, saying the company was “not in receipt of any of the documents referenced by Bloomberg and thus cannot confirm their authenticity.”

The Branchburg site also produces migraine med Emgality, and Lilly has requested FDA authorization to produce GLP-1 diabetes med Trulicity on-site as well, Bloomberg said.

Potential quality issues for Lilly’s antibody come as an ill omen after the National Institutes for Health halted a phase 3 study of the therapy earlier this month on safety concerns.

The trial’s independent data safety monitoring board recommended the company pause enrollment, a Lilly spokesperson told CNBC in an email, adding, “Lilly is supportive of the decision by the independent DSMB to cautiously ensure the safety of the patients participating in this study.”

The trial halt came just days after Lilly asked the FDA to clear LY-CoV555 for emergency use based on phase 2 data showing it cut the rate of hospitalizations in patients recently diagnosed with mild to moderate COVID-19. However, two of the three doses tested in the study failed to beat placebo in terms of reducing viral load by the 11-day mark.

Roche’s arthritis drug Actemra was one of the earliest-identified COVID-19 treatment prospects. But the latest clinical studies have yielded mixed data—and seemingly contradictory results. A large observational study that looked at 3,924 critically ill COVID-19 patients admitted to intensive care units across top U.S. institutions linked Actemra treatment to a 29% reduction in the risk of death after a median follow-up of 27 days, according to results published in JAMA Internal Medicine.

Overall, an estimated 27.5% of patients who got Actemra within two days of ICU admission would die after 30 days, versus 37.1% for those who didn’t receive it. The beneficial effect was most pronounced in patients who had a more rapid disease trajectory and were admitted to the ICU within three days of symptom onset, the study finds.

Dysregulated inflammation plays an important role in COVID-19 disease progression. As the body fights the coronavirus, it may release too many inflammatory agents that may lead to organ failure or death. IL-6, which Actemra targets, is among those molecules found to be elevated in this cytokine release syndrome.

However, controlling IL-6 with Actemra hasn’t consistently translated into clear clinical benefits as scientists had hoped.

In a randomized clinical trial of 126 severe COVID-19 patients in Italy, investigators found no evidence of an Actemra-related improvement in disease progression—namely, the lungs’ ability to exchange air, ICU admission or death, according to results also published Tuesday in JAMA Internal Medicine. Specifically, 17 patients (28.3%) in the Actemra arm and 17 (27.0%) in the standard care group showed clinical worsening in 14 days.

Then, to further complicate the situation, a randomized clinical trial, which enrolled hospitalized patients in France with moderate-to-severe COVID-19 pneumonia, also found mixed results for Actemra.

Patients on the Roche drug were 42% less likely to require ventilation or die by day 14, according to a third study that appeared Tuesday in JAMA Internal Medicine. However, on the study’s other co-primary endpoint, the drug didn’t cut the risk of disease progression to a prespecified WHO clinical status benchmark by day 4.

The three studies add to a growing body of evidence that has yet to reach a conclusion about Actemra’s role in COVID-19. They have their limitations, which makes interpreting their findings difficult. For example, there are potentially important differences in treatment groups at baseline in the U.S. observational study, Jonathan Parr of the University of North Carolina at Chapel Hill pointed out in an editorial that ran alongside the papers. Some of the patients in the Italian study who were not assigned to the experimental group actually got Actemra as their disease worsened, he noted.

He also questioned the significance of the French finding that Actemra may improve outcomes at 14 days, given mixed 28-day findings from two Roche-sponsored trials. The Covacta study showed Actemra couldn’t significantly improve clinical status or prevent death compared with placebo. But in the Empacta trial, which primarily enrolled patients from minority racial and ethnic groups, the drug led to a major reduction of mechanical ventilation or death by day 28, though the death rate difference was not statistically significant.

Parr said he would wait for detailed, peer-reviewed results from those two studies and others. The Actemra arm in the U.K.’s massive Recovery trial “will better define [Actemra’s] role in COVID-19 management,” he said. That study recently found low-cost steroid dexamethasone could reduce the death rate in hospitalized patients.

“For now, however, findings from the randomized trials described herein do not support routine [Actemra] use in COVID-19,” Parr said.

For months, Pfizer CEO Albert Bourla had maintained that the company would know this month whether its BioNTech-shared COVID-19 vaccine works. But top scientists pushed back, the FDA released detailed guidelines and critics grew increasingly louder.

Now, finding himself alone in the biopharma world with that bullish estimate, the Big Pharma chief is changing his tone.

Pfizer won’t apply for FDA emergency use authorization before the third week of November, Bourla wrote in an open letter on Friday.

What about October? That’s when the company might know whether the vaccine, dubbed BNT162, is effective, but the company still needs to gather enough safety data for an application, Bourla explained.

That’s a clear shift from Bourla’s previous comments, which constantly featured “October” as the key word—at a time when President Donald Trump was touting a vaccine before the Nov. 3 election, and mentioning Pfizer by name.

“Right now, our model, our best case, predicts that we will have an answer by the end of October,” Bourla previously said on the “Today” show. During a digital event in September, he also said the company expected initial results in late October and would seek FDA authorization as soon as possible. In October, “the truth will be revealed,” was what he told The Washington Post.

That October timeline sounded even more aggressive when Moderna CEO Stephane Bancel, known for touting ambitious goals, said his company’s shot, which was the first in the U.S. to move into clinical testing, likely wouldn’t have data until November.

Then, in late September, more than 60 researchers and bioethicists urged Pfizer to wait until late November at earliest to file its vaccine for FDA review, arguing a submission before accruing at least two months of safety data would “severely erode public trust and set back efforts to achieve widespread vaccination.”

For an emergency use application, the FDA is requiring at least two months of safety data on half of the trial participants after their final vaccine doses, according to a guidance document released last week.

To understand the vaccine’s efficacy—that is, whether it can protect individuals from COVID-19—a certain number of COVID-19 cases in the phase 3 trial need to be counted before investigators can compare the effectiveness of the vaccine with placebo. That means the data may come earlier—by October—if infections come quickly, Bourla explained in the open letter.

But effectiveness is only one of three metrics Pfizer will use for applying its vaccine for public use, he added. “Safety is, and will remain, our number one priority, and we will continue monitoring and reporting safety data for all trial participants for two years,” he said.

What’s more, the company will also gather manufacturing data to demonstrate “the quality and consistency of the vaccine that will be produced,” Bourla said. And that information will be ready before the safety readout, he said.

Despite his previous timeline falling in line with Trump’s, Bourla has said Pfizer is only “moving at the speed of science,” not politics. “In this hyper-partisan year, there are some who would like us to move more quickly and others who argue for delay,” he wrote in another open letter earlier this month. “Neither of those options are acceptable to me.”