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Regeneron Dips on Safety Concern Over Gout Treatment [UPDATE]


FDA raises questions about whether Regeneron's drug Arcalyst's benefit to gout patients is worth the safety risk.


UPDATE May 9, 2012 Regeneron's (REGN) drug Arcalyst shouldn't be approved for the treatment of gout flares, a panel of expert advisers to the Food and Drug Administration agreed Tuesday afternoon. In a vote, the panel decided 11-0 that the company had not shown enough proof of the drug's safety and effectiveness to warrant an approval by the FDA. The agency will consider the recommendation and make a final decision by July 30. It's an embarrassing defeat for Regeneron, though a rejection would be a small setback for the company. Regeneron has a potential blockbuster drug in Eylea.

The early success of Regeneron's eye drug Eylea overshadowed the company's recent movement toward winning approval for a gout treatment. That is until today when some government folks questioned whether the company's drug, Arcalyst, may carry too many risks.

Shares fell more than 3% early Friday, and were down less than 2% to $131.74 in late-morning trading. The stock has more than doubled this year.

Regeneron is trying to win approval to sell its drug Arcalyst for the treatment of gout flares in patients already on a uric acid-lowering drug. (Arcalyst, with $20 million in sales last year, is only approved for a rare, genetic inflammatory disease that can lead to kidney failure.) The comments about safety were made in briefing documents ahead of a government panel Tuesday (May 8) to discuss the new use of the drug.

As Americans continue to get fatter, gout represents a decent market for drug makers. However, Regeneron is only aiming at a piece of that market. One analyst last year predicted the new use of the treatment would boost annual sales to about $170 million by 2014 (assuming Arcalyst won the gout indication this year). That's far less than the multi-billion dollar revenue opportunity with Eylea. (See Regeneron Shares Jump on Strong Sales of Eye Drug.)

In advance of a meeting next week in which government advisers will weigh in on the possible benefits of Arcalyst as a gout therapy, staff reviewers with the Food and Drug Administration raised some concern about the safety of the product. The drug presents a small risk of cancer as it suppresses the body's immune system, according to FDA documents. That has the agency's reviewers questioning whether the risk of side effects outweigh the benefit of the medicine.

"The benefit-risk evaluation must take into account the studied patient population," the reviewers wrote. "Gout patients enrolled in this development program were not a chronic, refractory population for which other measures of disease control and flare (treatment) had proven ineffective."

Regeneron is proposing a 16-week treatment and therefore didn't provide long-term safety evaluation of Arcalyst in gout patients, another weak spot in the company's application for market approval, according to the FDA staff.

"Safety data beyond 16 weeks has not been provided in this submission," the reviewers said. "The lack of long-term safety data for a biologic immunosuppressant is not typical."

Click here for a list of proposed questions for the panel meeting.

In 2009, Japan's Takeda became the first company in four decades to bring a new gout medicine to the US market by winning approval to sell Uloric. Other companies, including BioCryst Pharmaceuticals (BCRX) and Ardea Biosciences (RDEA) also are developing new gout drugs. (See Gout Drug Developer BioCryst Rises on Study.) Ardea's drug attracted AstraZeneca (AZN), which recently said it would acquire the biotech company for $1.26 billion.

According to BioCryst figures, there are more than 8 million Americans with gout, a number that's expected to rise 9.6 million by 2015. The drug companies also see Europe and Japan as key markets for new medicines.

Twitter: @brettchase

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