Biotech Week In Review: Valeant, Progenics, Relistor and Vesneo – Valeant Pharmaceuticals Intl Inc (VRX) Progenics Pharmaceuticals, Inc. (PGNX)

Last week, the FDA had two major decisions to make regarding troubled drug maker Valeant Pharmaceuticals Intl Inc (NYSE:VRX). The first was whether or not to approve Relistor, a combined effort between Valeant and Progenics Pharmaceuticals, Inc. (NASDAQ:PGNX). The second, the same decision for Vesneo, a glaucoma drug that Valeant has developed by way of its subsidiary Bausch + Lomb.

Here’s what happened, and what to do going forward.

DRUG: Relistor

COMPANIES: Valeant  Pharmaceuticals Intl Inc (NYSE:VRX)and Progenics Pharmaceuticals, Inc. (NASDAQ:PGNX) 

PDUFA: July 19 2016

OUTCOME: APPROVED

The drug

Relistor is an opioid induced constipation (OIC) target, a drug that basically counteracts the side effects of yet another drug. The version that Valeant was trying to get approved was an oral version of the currently available subcutaneous injection version. Opioids work by binding to opioid receptors in the central nervous system, and stimulating an analgesic response through the excitation of various neurotransmitters. However, they also bind to the comparable receptors outside of the CNS – many of which are in the gastrointestinal tract. This binding essentially paralyses the lining of the GI tract, meaning it doesn’t push stools through as it would in a normal transitory environment.

Relistor is a targeted opioid receptor inhibitor, which selectively binds to the receptors in the GI tract, without affecting those in the CNS. By binding to these receptors, it blocks the opioids from doing so, and they pass harmlessly through the system. In turn, the lining is able to perform its usual motor-promotion to get stools through effectively and relieve constipation.

As mentioned, the current version is a subcutaneous injection version. This is inconvenient, and can induce adverse events related to entry site irritation, etc. It also doesn’t really promote administration adherence. Valeant’s alternative is an oral administration version, which is far easier to administer for obvious reasons, and as such, far more convenient and easy to stick to from a dose regimen perspective.

The data

The data on which the NDA was based came from a randomized, double-blind, phase III trial that compared the oral Relistor formulation to placebo in a patient population of 201. All had chronic non-cancer pain, which is the group that the company is targeting. (Cancer related pain/constipation requires a different treatment). In a 450 mg treatment arm, the drug demonstrated statistically significant improvement in rescue-free bowel movement (RFBM) within 4 hours of administration, across a 28 day treatment period, when compared to placebo. An RFBM is when no laxatives were taken for 24 hours.

This was the primary endpoint of the trial, so it was a hit. The safety profile of the drug came in as comparable to the placebo arm, which was a bit of a bonus, as the subcutaneous version has a pretty severe adverse events profile. Chances are that the actual safety profile is more in line with the sub cut version than the trial suggested, but it didn’t do the NDA any harm.

The Market

In a recent report, analysts predicted that the global market for OIC treatments will reach $2.7 billion by 2022, with the US accounting for a little over $1.16 billion. The same report suggests that the primary contributing factor to the growth (it was a $1.9 billion market at the time the study was put together, 2014) would be the introduction of easier administration alternatives to the then current options, and lists Relistor as one of these alternatives. It’s reasonable to assume that the company will be able to achieve a relatively high level of penetration – 40-70% – and in turn, suggest that the potential peak US sales by 2022 come in at anywhere between $650 million to $1.1 billion.

The Response

Valeant Pharmaceuticals Intl Inc (NYSE:VRX) gained around 5% on the announcement that the agency had approved Relistor, but the momentum was tempered somewhat as markets looked to the drug we are going to discuss next as either having a compounding or a limiting effect on the upside potential. Progenics Pharmaceuticals, Inc. (NASDAQ:PGNX), as expected, was the big winner of the day, gaining close to 25% on the announcement.