Staff Writer

The FDA's approval Wednesday of Regeneron Pharmaceutical Inc.'s interleukin-1 blocker Arcalyst (rilonacept), for treating a pair of rare inflammatory diseases, is unlikely to pit the product against Amgen Inc.'s anti-IL-1 product, Kineret (anakinra), Joseph Pantginis, analyst at Canaccord Adams Inc., told BioWorld Today.

However, other IL-1 blockers in the pipeline, Xoma Ltd.'s XOMA-052 and Novartis AG's ACZ885, could pose potential competition for Arcalyst in the future, Pantginis said. The Tarrytown, N.Y.-based Regeneron does have opt-in rights in the U.S. and ex-U.S. royalties for the Novartis product from a past partnership, but the opt-in rights would be "pretty hefty," he added.

As it stands now, though, payers will not pay for Kineret if it is used off-label to treat the diseases that Arcalyst is approved for, Pantginis said, citing a company conference call. Kineret, the older IL-1 blocker made by Amgen, is approved for rheumatoid arthritis, while Regeneron's newly approved Arcalyst is for the treatment of a rare set of disorders known as cryopyrin-associated periodic syndromes (CAPS).

Xoma's product is in a Phase I study for Type II diabetes, with data expected in the third quarter of 2008. Based on the data from that study, the company may study three other indications: gout, rheumatoid arthritis and a juvenile form of RA, a company spokesman said.

The FDA approved Arcalyst late Wednesday for use in CAPS, inherited disorders that affect about 300 people in the U.S. The product launch is expected within 30 days of the approval. Even though Regeneron and Amgen's IL-1 blockers are approved for two different uses, doctors presumably would be more comfortable prescribing Kineret before trying Arcalyst, since the Amgen product has more than a decade of safety data supporting it, said Alan Solinger, former clinical leader of anti-IL-1 Kineret program at Amgen, who now serves as vice president of clinical immunology of Xoma.

But that scenario appears unlikely to play out, in Pantginis' view. "Payers will not pay for Kineret in CAPS because it has not been tested in that indication," he said. The wholesale cost for Arcalyst is $250,000 a year, while Kineret's costs would be in the range of Shire plc's Elaprase ($300,000) and Genzyme's Myozyme and Cerezyme ($200,000 each), according to Pantginis' figures.

Regeneron has initiated a Phase II study of Arcalyst in 80 gout patients. The study is half-way enrolled and could complete enrollment in the second half of the year, said Leonard S. Schleifer, president and CEO of Regeneron. Arcalyst is the first product to emerge from Regeneron's Trap program, which also includes two partnered VEGF Trap candidates targeting cancer and wet age-related macular degeneration. Noting the company's "broad pipeline," Schleifer said the company has enough cash to last "quite a long time." The Tarrytown, N.Y.-based company ended 2007 with $845 million in the bank and has a net cash burn rate of $75 million to $100 million, he said.

Touting Xoma's IL-1 beta blocker, XOMA-052, Solinger said the product candidate could have a potential advantage over the approved IL-blockers. He explained that the XOMA product candidate binds with IL-1 beta, blocking the interaction with the receptor and the formation of the complex triggers inflammatory cascade. In this way, the product could be dosed less frequently and at lower doses than Amgen and Regeneron IL-1 blockers, he said.