Adding to its already formidable ophthalmology franchise, Novartis AG entered a deal with Genentech Inc. for rights outside North America to the latter's therapy for the wet form of age-related macular degeneration.
The drug, Lucentis (ranibizumab, formerly known as rhuFab V2), is an anti-vascular endothelial growth factor antibody fragment in Phase III trials for AMD, a leading cause of blindness that affects about 1.5 million adults in the U.S.
Basel, Switzerland-based Novartis is buying for an undisclosed sum the development and marketing rights outside the U.S., Canada and Mexico.
Under the terms, South San Francisco-based Genentech and Novartis will share certain global development costs. Along with an up-front fee, Genentech gets payments for achievement of clinical development milestones, plus royalties on sales of Lucentis products outside North America.
Novartis already has Visudyne (verteporfin) on the market for wet AMD, which is caused by growth of abnormal blood vessels under the central part of the retina or macula. The vessels leak fluid and blood, causing scar tissue that destroys the central retina. Visudyne sold $287 million in fiscal year 2002.
"It's a potentially huge market," said analyst Michael King, with Banc of America Securities in New York. Visudyne and Lucentis are "initially for different types of AMD, but they could theoretically at the outset be complementary," he said.
"There's a general belief that [Visudyne] is not really a great drug, so Genentech is in somewhat of a leadership position," King told BioWorld Today. "If something more effective and more convenient could come along, it could gain substantial market share eventually. But this is going to be a situation where the market grows" before drugs take share from each other, he said.
To estimate peak sales of about $500 million annually for Lucentis is "not unreasonable," King said, acknowledging that several other companies have AMD drugs in development.
The most recent public data on Lucentis were offered in October at the meetings of the Vitreous Society and the Retina Society in San Francisco. Early data from the randomized, single-agent Phase Ib/II study showed that, of 53 patients treated with rhuFab V2, 50 had stable or improved vision. Fourteen of them improved 15 letters or more on the Early Treatment of Diabetic Retinopathy Study chart (so named because of its first use), and 36 had stable vision at day 98.
On average, patients treated with rhuFab V2 gained nine letters on the ETDRS chart at day 98 compared to patients treated with standard of care, who lost 4.9 letters. The most common side effects were mild, transient, reversible inflammation.
Based on those findings, Genentech started a Phase III study in minimally classic and occult AMD in March, and this month began enrolling patients in a Phase III study in predominantly classic AMD.
Genentech's stock (NASDAQ:DNA) closed Wednesday at $71.70, up 5 cents.