ThromboGenics NV won the backing of European Union regulators for the Jetrea eye drug, moving the Belgian company closer to earning a payment of 90 million euros ($120 million) from its partner Novartis AG.
The European Medicines Agency’s Committee for Medicinal Products for Human Use recommended that Novartis be allowed to market Jetrea for use in people with vitreomacular adhesion, a condition which causes vision to become distorted or lost, the Basel, Switzerland-based company said in a statement today. The European Commission, which grants marketing approvals, usually follows the committee’s advice.
ThromboGenics sold marketing rights for Jetrea outside the U.S. to Novartis in March in a deal worth as much as 375 million euros. The drug is the first for a condition that afflicts as many as 300,000 people in Europe, and which was previously treated only by surgery.
“Within a couple of years we should probably see peak sales being achieved for this kind of product faster than on average,” Jan De Kerpel, an analyst at KBC Securities NV in Brussels, said in a telephone interview before today’s announcement. “There’s no competition. It can grow faster in terms of reaching its peak sales potential compared with other products where there’s competition.”
ThromboGenics fell 3.3 percent to 43.84 euros in Brussels, giving the company a market value of 1.57 billion euros. The stock has gained 137 percent in the past 12 months, making it the third-best performer on the Stoxx Europe 600 Index. Novartis fell 0.9 percent to 61.15 Swiss francs in Zurich, for a market value of 165 billion francs.
“Funds have waited for this news to sell after the massive rally,” De Kerpel said in an e-mail today. “Now it’s waiting until August to see how the product launch will go. The lack of intermediate news could create volatility.”
ThromboGenics received an upfront payment of 75 million euros from Novartis, will receive a further 45 million euros if the drug is approved in Europe, and another 45 million euros on the first sale of the product in any country outside the U.S., Wouter Piepers, a spokesman for ThromboGenics, said in an e-mail. The company may receive another 210 million euros in payments for meeting development goals, he said.
Novartis also will pay royalties to ThromboGenics on sales of Jetrea, which may reach 335 million euros a year outside the U.S., according to Peter Welford, an analyst at Jefferies International Ltd. in London. Novartis may pay a gross royalty of about 30 percent, he said.
ThromboGenics won approval in October for Jetrea in the U.S., where it started the selling the drug this week. Annual sales there may be as much as $500 million, Welford said.
Jetrea targets the vitreous, a jellylike substance between the eye’s lens and retina. With age, the vitreous liquefies and separates from the retina. In vitreomacular adhesion, the separation is not complete, creating a pulling force on the retina that can lead to loss of vision. Jetrea, which is injected into the eye, is designed to complete the separation, restoring vision.
In two trials of Jetrea involving 652 patients in Europe and the U.S., a single injection of Jetrea resolved vitreomacular adhesion and the visual symptoms associated with it in 30 percent of patients, compared with 7.7 percent of those receiving a placebo, ThromboGenics said in August 2011.
In a July 2012 report, staff from the U.S. Food and Drug Administration found side effects including eye pain, perceived flashes of light, blurred vision and impaired vision happened two to four times more often in patients receiving Jetrea than those getting a placebo in a trial. Still, the FDA’s advisers voted 6-3 that additional studies aren’t needed to evaluate the safety of Jetrea’s effect on the retina before the drug is approved.
While panel members raised concern that the medicine may not benefit a high proportion of patients, they said it was better than the alternative of surgery.