AstraZeneca Shares Fall Most Since 2008 on Brilinta
AstraZeneca Plc fell the most in more than two years in London trading after the U.K. drugmaker failed to win U.S. approval for a new blood thinner to rival Plavix, the world’s second-best selling drug.
The stock dropped 212 pence, or 6.7 percent, to 2,941 pence, the steepest decline since Nov. 21, 2008, and the worst performance today on the 18-company Bloomberg Europe Pharmaceutical Index.
The Food and Drug Administration asked for additional analysis of a study called Plato comparing Brilinta with Plavix in patients with severe chest pain or earlier heart attacks, London-based AstraZeneca said yesterday in a statement. The twice-daily pill won a 7-1 recommendation from an FDA advisory panel on July 28 although all committee members had expressed concern about study results in the U.S., where many patients were also receiving high-dose aspirin.
“This is bad news for AstraZeneca,” Eric Le Berrigaud, an analyst at Raymond James in Paris, who today lowered his recommendation on the stock to “fair-value” from “buy,” said in a telephone interview. “Brilinta is the biggest growth driver in AstraZeneca’s pipeline and it’s taking a hit.”
The FDA’s decision delays a product whose sales may have reached $2.7 billion by 2015, according to the average estimate of three analysts surveyed by Bloomberg. AstraZeneca, the U.K.’s second-biggest drugmaker, needs new products as patents expire in the next four years on the heartburn drug Nexium and the antipsychotic Seroquel, which generated a combined $9.83 billion in revenue last year.
“This delay will come as a disappointment to many and may also start to raise uncertainties about the potential scale of the product’s likely commercial success,” Jeffrey Holford, an analyst at Jefferies International Ltd. in London, wrote in a note to clients today. Holford rates the stock a “hold.”
Regulators didn’t ask for new clinical trials for the drug, known by its chemical name, ticagrelor, and “our highest priority is to provide the requested Plato analyses to the FDA,” Martin Mackay, AstraZeneca’s president of research and development, said in the company’s statement.
“The company remains confident in the submission for ticagrelor and in its ability to respond to the agency’s questions,” AstraZeneca said in the statement.
Before today, the drugmaker had gained 8.3 percent this year, compared with the 7.1 percent increase recorded in the period by the Bloomberg Europe Pharmaceuticals Index.
Brilinta would compete with Plavix from New York-based Bristol-Myers Squibb Co. and Paris-based Sanofi-Aventis SA, and Effient, sold by Eli Lilly & Co. All three are pills designed to prevent platelets in the blood from clumping together to form clots, which can cause heart attacks and strokes. Plavix and Effient are taken daily and remain effective for one week after treatment is halted. Brilinta wears off more quickly, so it may pose a lower risk of bleeding for surgery patients.
In Plato, AstraZeneca’s key study of 18,624 people, 9.8 percent of patients on Brilinta for a year had a heart attack, stroke or died from cardiovascular disease, compared with 11.7 percent of those on Plavix. A related study also showed AstraZeneca’s medicine was effective regardless of the patients’ genetic makeup, unlike Plavix, which doesn’t work in patients with a certain genetic variation.
Study participants in the U.S. and Canada did worse on Brilinta than people from other parts of the world. In backing the drug, the FDA’s advisers said in July the findings may be the result of chance and could be examined in a new trial after approval. FDA staff rejected AstraZeneca’s suggestion that higher U.S. aspirin use contributed to the outcome.
FDA approval of Brilinta already had been delayed once, in September. The exact reason for this additional delay is unclear, Tim Anderson and other analysts at Sanford C. Bernstein wrote in a note to clients today. They have a “market-perform” recommendation on AstraZeneca shares.
Brilinta was approved this month in Europe, where it is known as Brilique. AstraZeneca will likely begin marketing the drug in the second half of 2011 once prices are negotiated with member countries, Sarah Lindgreen, a company spokeswoman, said Dec. 6.
AstraZeneca will market the drug based on the results of the study that showed a benefit over Plavix, Lindgreen said.
Plavix, introduced in 1997, had sales of $9.8 billion last year. Effient, approved in July 2009 with a boxed warning on bleeding risk, made $27 million last year for Indianapolis-based Lilly and its marketing partner, Daiichi Sankyo Co. of Tokyo.
Lipitor, a cholesterol pill made by New York-based Pfizer Inc., is the world’s best-selling drug with 2009 revenue of $11.4 billion.