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Now Eylea Not Down Asleep: Regeneron Up for 'Dogfight'

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By Randy Osborne
Staff Writer

SAN FRANCISCO – As Wall Street mulled fourth-quarter sales numbers for Regeneron Pharmaceuticals Inc.'s macular degeneration drug Eylea (aflibercept), which beat expectations but disappointed some investors, CEO Leonard Schliefer spoke to the J.P. Morgan Healthcare Conference, outlining the future of the drug as it faces competition on two fronts.

Fourth-quarter Eylea sales of $276 million topped the consensus forecast that ranged from $267 million to $274 million, but apparently not by enough, as the Street has grown accustomed to dancing to a bigger "beat." Tarrytown, N.Y.-based Regeneron (NASDAQ:REGN) shares dipped a little Tuesday to close at $176.63, down $5.90.

Eylea was approved in November 2011 with a less frequent dosing schedule for the ophthalmic solution and lower cost than Roche AG's market-dominating VEGF inhibitors, Lucentis (ranibizumab) and the cancer drug Avastin (bevacizumab), sold off-label as what Schliefer called the "cheaper, almost generic-type price alternative" to Lucentis. (See BioWorld Today, Nov. 22, 2011.)

Schliefer told attendees of the meeting that the Eylea launch "ranks up there in the top four or five launches in the history of our industry, but we expect [high sales] to keep going."

Regeneron, he said, achieved the fourth-quarter sales even though the holidays and storms intervened.

"Despite a lot of, if you will, headwinds, we think we were able to do a pretty strong quarter, and we think there is potential for a significant number of tailwinds behind us," he said.

Eylea could, like Lucentis, prove useful in more indications, such as diabetic macular edema. "All of our Phase III trials [with Eylea in that condition] are fully enrolled," he said.

What's more, Schliefer said, "the opportunity outside the U.S. is very substantial, very real. We know we're going to be in for a dogfight. Novartis is very tough, but I think Bayer [AG, of Leverkusen, Germany, Regeneron's partner outside the U.S.] is up to the task. The drug has been approved in Europe; it's launched in Japan; and we're rolling it out in the next year or so."

A flurry of analyst reports responded to the company's fourth-quarter income tally. Among them, Robyn Karnauskas, of Deutsche Bank, saw "room for upside" in guidance for 2013 sales of $1.2 billion to $1.3 billion, since many difficult-to-treat patients (about 50,000 of them) are still not on Eylea, and the market share in newly diagnosed patients could increase as doctors become more comfortable with the drug. Also, compounding pharmacy issues could make patients switch to Eylea from Avastin, Karnauskas wrote – a factor also mentioned by Schliefer.

After spending some time on blockbuster-to-be Eylea in his talk, Schliefer moved on to other potential stars in the pipeline. "We're not standing still scientifically," he said. "That's not Regeneron's style." Nor is the company "a Hollywood story, [in which] we got to the finish line, I mortgaged the house to pay for the last regulatory filing fee, and we got across, and here we are," he said.

"It's navigating and preparing for failure that distinguishes, I think, companies in this industry," Schliefer said.

"You don't want to be too distinguished. We've had lots of failures over the last several decades, but it really has taught us that no matter how smart we think we are, no matter how hard we work at something, you need to recognize that there are many different ways to lose your favorite product. When we got across the finish line with Eylea, we had a robust pipeline of more than 10 different molecules already in clinical development," he noted.

Of particular interest: the compound known as SAR236553/REGN727. It's a fully human antibody that targets proprotein convertase subtilisin/kexin type 9 (PCSK9), given subcutaneously. With Regeneron's partner Sanofi SA, of Paris, the global ODYSSEY program began this summer. The entire Phase III effort, with the start of the latest study, includes 11 trials and 20,000 patients. (See BioWorld Today, July 23, 2012, and Nov. 6, 2012.)

"We are plugging into the exact [right] pathway," Schliefer said, adding that "overwhelming" epidemiological, genetic and clinical data show that increasing LDL receptors works.

"When that mechanism is disrupted, such as in genetic diseases, you have heart disease," he said. "When that mechanism is working better, such as when you put statins in . . . you prevent heart disease."

PCSK9 is similar, Schliefer said. "The blocking of PCSK9, whether you do it genetically, if you're born that way, or you do it pharmacologically, allows more LDL receptors to be expressed on the surface of the liver cell and suck LDL out of the bloodstream. All ways of manipulating cholesterol are not the same, and ones that do it through the LDL receptors are ones you can have a lot of confidence in."

Sanofi is collaborating with Regeneron on the PCSK9 program.