Novartis’s Multiple Sclerosis Pill Faces FDA Review

Novartis AG (NOVN)’s drug Gilenia has risks that may outweigh its benefit in treating multiple sclerosis, according to U.S. regulators reviewing whether to approve the first pill to slow progression of the disease.

Gilenia, while effective, causes a gradual decline in lung function and is linked to certain cancers, Food and Drug Administration staff said today in a review. Outside advisers to the FDA are scheduled to meet June 10 to recommend whether the drug, also called fingolimod, should be approved for sale.

Novartis, of Basel, Switzerland, is racing German drugmaker Merck KGaA (MRK) to sell the first pill to stall MS, competing with injected remedies led by Biogen Idec Inc. (BIIB)’s Avonex. The FDA has said it will complete its review by September. Gilenia may go on sale in 2010 and reap $1 billion a year, Novartis has said.

“The pivotal efficacy studies provide robust evidence of the efficacy of fingolimod to reduce the frequency of clinical exacerbations in patients with relapsing remitting MS,” FDA staff said in the report. “The clinical development program also uncovered a number of safety issues, which will be the primary focus for the advisory committee meeting.”

Skin cancer and heart risks will probably fuel a “vigorous debate” at the panel meeting, Yaron Werber, an analyst for Citibank in New York, said June 4 in a research note. Those risks were linked to the treatment in a study published in January in the New England Journal of Medicine, and also identified today as adverse events in the FDA review.

‘Pulmonary Flag’

“It’s clear that adverse effects were always something that Novartis wanted to minimize, so it’s not surprising that the FDA panel would focus on safety, though it wasn’t expected that a pulmonary flag would be raised,” said Carri Duncan, an analyst at Macquarie in Zurich.

Novartis fell 45 centimes, or 0.9 percent, to 51.95 Swiss francs in Zurich trading.

The FDA may ask for more information on Gilenia in September instead of clearing it, a move that would delay approval until the end of 2011, Werber said in the note.

“A positive recommendation is far from certain and, even if the panel does give a positive vote, the FDA’s recent track record has become somewhat less predictable,” Werber said. Global sales of Gilenia may reach $780 million in 2014, he said.

The FDA rejected Merck’s application for rival pill cladribine in November, saying it was incomplete. Merck, based in Darmstadt, Germany, said today it resubmitted the drug for U.S. approval.

Immune System Attack

Multiple sclerosis affects about 2.5 million people, according to the National Multiple Sclerosis Society in the U.S., causing the body to attack itself through the immune system.

Gilenia and cladribine blunt the immune system’s attack on nerve cells. The drugs target certain white blood cells that harm the protective coating of nerve cells during MS. Cladribine was approved more than a decade ago to fight leukemia.

Acorda Therapeutics Inc. (ACOR)’s pill to improve walking in multiple sclerosis patients was approved by U.S. regulators in January, the first therapy of its kind cleared for sale. The pill, which is co-promoted with Biogen, doesn’t treat the underlying disease.

Doctors also often prescribe oral corticosteroids to damp the immune system’s effects during acute attacks. These medicines also don’t affect the underlying disease.

Novartis and Mitsubishi Tanabe Pharma Corp. (4508) will develop and sell fingolimod in Japan, said Takayuki Ikeda, a spokesman for the Osaka-based drugmaker. Novartis bought overseas rights in September 1997 to the medicine, discovered in research involving Mitsubishi Tanabe’s predecessor company, Ikeda said.

To contact the reporters on this story: Elizabeth Lopatto in New York at elopatto@bloomberg.net; Molly Peterson in Washington at mpeterson9@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net.

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