By Jennifer Van Brunt
One of the hottest biotech drugs on the market today is BioChem Pharma Inc.'s nucleoside analogue Epivir (3TC) for treating HIV infection and AIDS, which is licensed to London-based Glaxo Wellcome plc. Since its approval by the Food and Drug Administration in late 1995, the drug has become a cornerstone for all combination drug therapies for this devastating disease. And as the never-ending array of new potential therapies for AIDS make their way through the clinic, results so far have shown that most work best in combination with Epivir. A new combination tablet — named Combivir — which contains Epivir and Glaxo Wellcome's older AIDS drug Retrovir (AZT) — was approved for marketing in the European Union just last week. The tablet, which is intended to reduce the number of pills that HIV-infected individuals have to take on a daily basis, was also approved for marketing in the U.S. in late September.
According to Eric Schmidt, an analyst at New York-based UBS Securities LLC, the new approval of Combivir won't result in significant increases in overall sales of 3TC (as Epivir), since that market has continued to grow non-stop from the very beginning. But growth is more rapid in Europe at the present time, since the drug was approved there more recently than in the United States. Worldwide sales of Epivir have already more than doubled, from C$429 million (US$315 million) in 1996 to C$973 million (US$703 million) in 1997. This drug is clearly on its way to breaking the $1 billion barrier. And that's just for treating AIDS. The same product, under the trade name Lamivudine, is also in advanced development stages for treating chronic hepatitis B virus infection. In fact, Glaxo Wellcome is predicting market launch of 3TC (as Lamivudine) in the People's Republic of China in the second half of 1998. According to UBS' Schmidt, worldwide sales of Lamivudine could then reach $119 million by the end of 1998. This includes projected approvals not only in China but also in additional Pacific Rim countries. And even the currency crisis in Asia shouldn't affect drug sales, he said. So far, anyway, China has remained relatively immune to the crisis. As far as the other countries in the Pacific Rim are concerned, he continued, the prevalence of hepatitis B virus infection is so enormous that even a low market penetration of the drug — say, to treat very sick patients who have been hospitalized — could generate extremely significant sales. Moreover, pharmaceuticals — and their manufacturers — are generally recession-resistant.
Epivir is not the only biotech product that's still on a steep sales curve, however. Biogen Inc.'s (NASDAQ:BGEN) Avonex, recombinant interferon-beta 1 for treating multiple sclerosis, has also achieved remarkable success. The product was approved for sale in the U.S. in May 1996; for that year, Cambridge, Mass.-based Biogen recorded sales of $77 million. For 1997, worldwide sales came in at $240 million. According to Biogen, about 35, 000 patients worldwide are now on Avonex therapy and the product is on the market in every major European country.
And Centocor Inc.'s (NASDAQ:CNTO) platelet aggregation inhibitor ReoPro is also on a roll, racking up sales in 1997 of $254 million, up 70 percent from the previous year and growing. The Malvern, Pa. company's marketing partner for ReoPro, which is a chimeric monoclonal antibody fragment to the GPIIb/IIIa receptor on blood platelets, is Indianapolis, Ind.-based Eli Lilly & Co. ReoPro was approved by the FDA first in December 1994, for preventing blood clots in the setting of high-risk balloon angioplasty (PTCA). But in November 1997, the FDA granted an expanded label for the drug, so it can now be used to prevent cardiac ischemic complications in a broad range of patients, including those with unstable angina not responding to normal therapy. Use of the drug in this broader patient population should send sales soaring in 1998.
Biotech's "first-generation" drugs — Epogen, Neupogen and Activase, for instance — are all big sellers, dollar-wise, but their rate of growth and market penetration has slowed, plateaued or even started to fall off as competing products hit the market. Still, Epogen and Neupogen, marketed by Amgen Inc., are both billion-dollar drugs in their own right. And Genentech Inc.'s products — Activase, the growth hormones (Protropin, Neutropin and Neutropin AQ) and Pulmozyme — together reaped sales of close to $600 million in 1997. (See the chart on p. 3 for detailed sales figures, on a yearly basis, for these and other selected biotech drugs.)
The "third wave" of biotech-derived therapeutics — including Regranex Gel, Rituxan, Infergen and Zenapax — are still so new to the market that the recently reported sales figures are not so much an indication of market potential as they are a reflection of inventory build-up and pipeline-filling.
Newly launched Rituxan, for instance, reaped $5.5 million in U.S. sales in 1997. But that figure is misleading since its developers, Genentech of South San Francisco and Idec Pharmaceuticals Corp. of San Diego only launched the product in the U.S. on Dec. 16, 1997. Genentech (NYSE:GNE) reported 1997 sales to third parties of $5.5 million for those two weeks, driven in part by pent-up demand for the product. Rituxan, the first stand-alone monoclonal antibody therapy for non-Hodgkin's B cell lymphoma, was also approved in Switzerland in late November 1997; it will be marketed there and in the rest of Europe by Switzerland-based F. Hoffmann-La Roche Ltd.
Amgen, based in Thousand Oaks, Calif., also launched its new drug for treating chronic hepatitis C infection late last fall. Amgen (NASDAQ:AMGN) reported fourth quarter and full year 1997 sales of $3 million for the drug, Infergen, which is a consensus alpha interferon. Again, these figures no doubt represent shelf-stocking activities on the part of physicians and hospitals.
A third new product to hit the market at the end of 1997 was Regranex Gel, a recombinant platelet derived growth factor for treating diabetic foot ulcers. Regranex was developed by the R.W. Johnson Pharmaceutical Research Institute, part of the Raritan, N.J.-based Johnson & Johnson family of companies, is manufactured and supplied by Emeryville, Calif.-based Chiron Corp. FDA approved the product in late December; Chiron (NASDAQ:CHIR) reported that fourth quarter 1997 sales of Regranex reached $11 million; once again, these early figures probably represent pipeline filling and cannot be taken as an indication of what future sales levels are likely to be.
However, they do represent impressive market debuts for younger biotech companies just launching their first products into the ever-competitive marketplace. And they also represent new directions for old biotech companies that need to keep those pipelines full.