Expert Financial Analysis and Reporting

The FDA had apparently slammed the door shut on approval of Johnson & Johnson’s Xarelto (rivaroxaban) for stroke prevention in patients with non-valvular atrial fibrillation (SPAF). The FDA reviewer in his briefing papers to the committee had recommended that the product be given a Complete Response Letter (not approvable at this time). The reviewer did indicate that that there might be an argument for approval in second or third line usage after warfarin and the recently approved dabigatran have been tried and failed. Yesterday the FDA Cardiovascular and Renal Drugs Advisory Committee re-opened the door a bit when it voted 9 yes, 2 no and one abstention to recommend approval of Xarelto for SPAF.

The biggest concern of the FDA had been with the TTR (time in therapeutic range) of warfarin in the ROCKET AF trial that was the basis on the NDA for Xarelto. The FDA had felt that the TTR of 55% versus an expected 62% to 65% when warfarin is dosed by skilled hands indicated that warfarin was underdosed and hence exaggerated the relative efficacy of rivaroxaban when compared to warfarin. The advisory committee took a different view and felt that the trial was an accurate reflection of how warfarin is used in the real world and did not feel it was appropriate to hold rivaroxaban to a higher theoretical standard.

The PDUFA date for Xarelto for the SPAF indication is November 5, 2011. It was previously approved on July 1, 2011 for short-term, post-surgical use for prevention of venous thromboembolism (VTE) prevention. The FDA does not have to follow the recommendation of the committee and can still issue a Complete Response Letter. If the FDA does approve Xarelto for SPAF there is likely to be language that indicates that it should be used after warfarin and the recently approved dabigatran have been tried and failed. This is the second or third line setting mentioned by the FDA reviewer in the briefing documents. In addition to the warfarin dosing issue, there was also an issue for the FDA on a combined dosing regimen when patients are transitioned from rivaroxaban to warfarin or vice versa. This could be handled by a post-approval safety study.

Today, there appears to be a reasonable chance for approval whereas when the briefing documents came out, the chance of approval seemed almost zero. This is a major positive for Johnson & Johnson. Some key opinion leaders feel that Xarelto should have been given as a twice a day drug given its half-life. With a Complete Response Letter, JNJ might have had to conduct a huge 15,000 patient trial that might take four years to determine the effect of twice a day dosing. If it gets approved for second or third usage, the correct dosing can be determined as the drug is used by physicians in real life.

The advisory committee vote also significantly increases the chance of approval
for PFE/BMY's apixaban in SPAF. Given the ARISTOTLE trial design which resulted in higher warfarin TTRs than were seen in ROCKET, apixaban will likely be given superior labeling in regard to efficacy and bleeding. The label may also reflect that apixaban   showed statistically significant superiority over warfarin in the ARISTOTLE trial. In the marketing of apixaban versus rivaroxaban, BMY/PFE will likely hold a clear advantage over JNJ. However, just being on the playing field would be a huge positive for JNJ. In my note of yesterday, I stated that I would still buy JNJ even if rivaroxaban were not approved. I obviously continue with that recommendation. I also upgraded BMY to a buy based on the labeling advantages that apixaban will probably have over rivaroxaban. I think that this is still the case even if rivaroxaban is approved and I continue with my buy on Bristol-Myers Squibb.