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Ipilimumab’s March 26 PDUFA Date Is Looming (BMY, $26.00)

The PDUFA date for ipilimumab is coming up on March 26th. This is an important component of BMY's outstanding pipeline. I anticipate approval.


Ipilimumab is Up on the News Front- Will It Be Approved on Its March 26 PDUFA Date?

I wrote that I believe that Bristol-Myers Squibb has an outstanding pipeline in my report of February 24, 2011 called Bristol-Myers Squibb- Outstanding Pipeline Makes It Most Attractive among Large Pharmaceuticals. A very important component of that pipeline is the oncology drug ipilimumab which has a March 26 PDUFA date. It is a new immunotherapy following on the path of Provenge. If the product is approved at the upcoming PDUFA date, I am projecting sales of $40 million in 2011, $125 million in 2012 and $275 million in 2013. Over time, I believe that it has the potential to be a $1 + billion product.


As I wrote in my February 24 report, the pipeline for Bristol-Myers Squibb is simply outstanding and there are a number of potential product approvals and clinical trial information in 2011 that could overcome the concern with the patent cliff that is currently troubling investors. I am intrigued by Bristol-Myers Squibb, but haven’t bought the stock as of yet. There are still significant clinical, regulatory and commercialization risks with all of the new products and it is hard to imagine that there will not be some road bumps along the way for some or all of them. Hence, I am not actively recommending the stock at this time although of the major pharmaceutical firms, it would be my first choice for patient long term investors.


The FDA did not seek the advice of an advisory committee in evaluating ipilimumab’s regulatory filing. This indicates that the FDA is comfortable with the issues involved with approval to the point that it does not feel that it needs expert outside opinion. The FDA will be considering results from Bristol-Myers Squibb’s 020 study which was extensively reported on at the June 2010 ASCO meeting and which I will shortly discuss.


I think that the FDA will be impressed by the results of ipilimumab in metastatic melanoma as it is the first drug to show a survival benefit in this stage of the disease. At the same time there are serious safety issues including some deaths in the trial that were attributable to the drug. Also, the trial design was unconventional in the use of an unapproved cancer vaccine in the study. The agency has almost certainly peppered BMY with tough questions, but without an advisory committee, we don’t know much of what is going on in the FDA’s mind. It is my expectation that the drug will be approved and this will probably occur on March 26. However, there is no certainty as it has become routine for the agency to give complete response letters to drug sponsors that delay approval.


Ipilimumab- What Is It?

Ipilimumab is a monoclonal antibody that blocks the effect of CTLA-4, a down regulator of the activity of the T-cell component of the immune system. Ipilimumab’s mechanism of action results in a “shot gun”, non-specific effect that broadly enhances the activity of the immune system. This substantially improves the body’s response to cancer, but at the same time leads to a broad array of troubling side effects. Ipilimumab and the recently approved prostate cancer vaccine Provenge are both immunotherapies, but their modes of action are quite different. Provenge increases the immune system’s ability to recognize antigens that are located on the tumor and mount an immune response more specific to the tumor cells. One of my physician contacts illustrated this point when he said that ipilimumab is like weeding your garden with dynamite while Provenge is like using a trough.


Both ipilimumab and Provenge are perplexing for physicians and patients in trying to judge whether they are working. They are very different from traditional chemotherapy drugs, which if they are going to be effective, quickly show a reduction in tumor size and progression of the disease. Immunotherapies like ipilimumab and Provenge are much slower to show a visible effect on cancers. In fact, the tumors may continue to grow after the drugs are given to the patient unlike the more immediate response of chemotherapy. And yet, both of these immunotherapies have been shown to lead to durable responses and increased survival. This is confounding for both physicians and patients and is requiring the medical community to think differently about how to assess and measure the effectiveness of immunotherapies.


Ipilimumab Results in Metastatic Melanoma Show Impressive Efficacy

The company reported encouraging results in its study 020 of metastatic melanoma at the June 2010 ASCO meeting; a trial which was started in 2003. The study involved ipilimumab in combination with an experimental cancer vaccine targeted at gp 100, a protein present on melanoma cells. It was a double blinded 3 to1 to 1 randomization which means that for every five patients that went into the study, three went to the combination of ipilimumab and gp 100, one to ipilimumab alone and one to the gp 100 vaccine alone. There were 403 patients in the ipilimumab plus gp 100 group, 137 in the ipilimumab only group and 136 in the gp 100 group.


The study population in the 020 trial was called a second-line population, but in reality many patients had received multiple lines of therapy and were in fact third line or refractory. They were very sick patients with poor prognosis. This population is truly representative of patients who have received multiple drug treatments, have not responded and are at the terminal part of their disease.


After two years of treatment, 24% of patients treated with ipilimumab were still alive compared to 22% in the ipilimumab combined with gp 100 group and 14% in the gp 100 only group. These comparisons were highly statistically significant and provided robust evidence of effect. Basically, the vaccine did not add to the therapeutic effect of ipilimumab nor detract based on this data. Importantly, the number of deaths in the trial after two years seemed to plateau for the ipilimumab arms Optimists would say that this is suggestive that as many as 20% of patients may have benefited from something approximating a cure. As of the ASCO meeting there were 94 patients who had survived two years or more.


There are significant safety issues with ipilimumab and it caused deaths in the 020 trial. The mechanism by which this drug induces activity, the proliferation of T-cells, also leads to serious side effects. In terms of deaths related to the mode of action of the drug, the total number of deaths in the study was seven; five in the combination arm and two in the ipilimumab alone arm. As investigators learned how to detect the symptoms of immuno-related adverse reactions sooner, management could be introduced earlier, and there was a better chance of averting severe side effects. The incidence of toxicity diminished as more was learned about detecting adverse events at an early stage and preventing or managing them.


BMY will be addressing all aspects of melanoma. A second study, 024, is a being done in first-line treatment of metastatic disease. The study has already completed accrual and BMY is awaiting results based on events. The primary end point is overall survival. Results from this trial could come at any time. It was originally thought that the 024 study would report out in late 2010. However, the required number of deaths required to stop the trial and analyze the data has not yet occurred or at least has not been announced. This study compares the standard of care (decarbizine) in combination with ipilimumab to standard of care alone.


The Addressable Market for Ipilimumab in Metastatic Melanoma

Metastatic melanoma is estimated to affect 40,000 patients each year in the US and 60,000 in the rest of the world. Half of the patients are younger than 59 years of age and many die in less than a year. There is currently no effective therapy. Although ipilimumab will initially be approved in a second line setting, this disease progresses so rapidly that most metastatic cancer patients will see it during the course of their disease. As was just noted, a trial in first line metastatic melanoma should report results in the near term. I believe this trial will be successful and lead to approval of ipilimumab in the first line setting as well.


What will the price be for ipilimumab? Some have speculated that it might be priced at $93,000 per year like Provenge. I don’t think so. Provenge can get way with this price because it does not require supportive care which in the case of some therapies can be as much as the cost of the drug. Ipilimumab has some serious side effect issues that will require extensive supportive care and it will also be used in combination with other expensive treatments unlike Provenge which is used alone.


I am guessing that ipilimumab will be priced at $50,000 per course of therapy. This makes for an addressable market for metastatic melanoma of $2 billion in the US and $3 billion in the rest of the world. I think that ipilimumab will capture a very significant share of this market and see it as having $1 to $2 billion of peak sales potential in metastatic melanoma. These estimates assume acute use of the drug, but there may be a role in maintenance which would substantially increase sales potential. It may potentially also be used in other types of tumors and this could create additional sales potential


Ipilimumab in Other Tumors

Ipilimumab has also shown encouraging results in metastatic, non small cell lung cancer patients who had not received prior therapy. It is being studied as an add on to the standard chemotherapy regimen of carboplatin and Taxol. A phase III trial should start this year. Based on data in Phase II, it appears that ipilimumab will work across all non small cell lung cancer histologies, squamous and non-squamous. The initial thinking is that it can complement chemotherapy across the board and across all patients. There is reason to believe that the drug will be effective in the entire non small cell lung cancer population. This would be a multi-billion addressable market


BMY has also started a Phase III trial in prostate cancer in a population that is receiving radiation therapy on bone lesions. They will be randomized to placebo or ipilimumab. As with chemotherapy in the non small cell lung cancer setting, the necrotizing of the tumor by radiation may potentiate an immunological response with ipilimumab. BMY is also planning, a second Phase III trial in prostate cancer in a much earlier stage of the disease, hormone resistant patients. This is the same patient population targeted by Provenge. This would also be a multi-billion addressable market

Disclosure: The author of this article owned shares of Dendreon at the time this note was written. This should be taken into account as it may introduce bias into the conclusions and interpretations that are made. In reading this note, you acknowledge that you have not used it as the sole basis of your decision making and that all investment decisions are based on your own analysis. An investment in Dendreon carries substantial risk and investors could potentially lose much of their investment. The reader acknowledges that he/she has carefully read the Investment Approach, Terms/Conditions and Disclosures sections in the About Us section of the website. The reader acknowledges that he/she will not hold SmithOnStocks accountable for any investment loss that may be incurred if a decision is made to invest in Dendreon.





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