Sales Halted in Biotech Drug Because of Link to a Death

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March 1, 2005

Sales Halted in Biotech Drug Because of Link to a Death

By ANDREW POLLACK

 

Sales of a new drug that had been hailed as a big advance in the

treatment of multiple sclerosis were abruptly suspended yesterday

after the product was linked to a rare but potentially fatal

neurological disease.

 

The drug, called Tysabri, had been approved by the Food and Drug

Administration only three months ago under a procedure designed to

speed the introduction of drugs for serious diseases. And many

analysts had predicted the drug would be a huge seller for Biogen Idec

and Elan, the companies that jointly marketed the drug.

 

But yesterday those companies' stocks collapsed after they announced

they were suspending sales and all clinical trials, having learned

that one patient died from a rare neurological infection and a second

patient was suspected of having the same condition, which is called

progressive multifocal leukoencephalopathy, or P.M.L.

 

Both patients had been participants in clinical trials in which they

had received Tysabri in combination with Avonex, another multiple

sclerosis drug, for more than two years. Avonex, which is also made by

Biogen, has been on the market since 1996 and has never been

associated with P.M.L. when used alone, so there is no need to stop

sales of that drug, Biogen executives said.

 

Executives at both companies said it was still not proved that

Tysabri, or the combination of Tysabria and Avonex, had caused the

condition. They expressed hope that the sales of the drug could

eventually resume. Still, they said, they decided to halt distribution

of the drug out of caution.

 

" We believe it's prudent to take a step back and evaluate the risk, "

James C. Mullen, the chief executive of Biogen, one of the nation's

largest biotechnology companies, said in a conference call to an

audience of more than 600 analysts, investors and reporters.

 

The F.D.A. said it agreed with the decision and advised patients

taking the drug to consult their physicians and stop using it.

 

Because the drug is new, only about 5,000 patients have taken it since

its introduction, and they have been getting it for a far shorter time

than the two patients who had the problems in the clinical trials. An

additional 3,000 people have received the drug in clinical trials.

 

The stock market reaction was swift, erasing billions of dollars in

shareholder value. Biogen, based in Cambridge, Mass., lost 43 percent

of its market value, with its stock plunging $28.63 to $38.65. Shares

of Elan, an Irish company, were hit even worse, with its American

depositary receipts falling 70 percent, or $18.90, to $8.

 

Tysabri had been expected to be the main driver of growth for Biogen,

the third-largest American biotechnology company after Amgen and

Genentech, and for Elan, which is still trying to recover from a

near-collapse precipitated by an accounting scandal. Many analysts had

predicted that Tysabri would become the leading drug for multiple

sclerosis and attain sales of $2 billion a year or more.

 

" One minute it's the holy grail, and the next it's one of the biggest

disappointments of the decade, " said Jennifer Chao, an analyst at

Deutsche Bank who changed her rating on Biogen to sell from buy yesterday.

 

The rapid emergence of problems with Tysabri, coming after reports of

problems with painkillers like Vioxx, made by Merck, is likely to

further raise public concern about the safety of pharmaceuticals and

about the F.D.A.'s oversight. And the agency's handling of Tysabri

might very well come up at a hearing today that Senator Michael B.

Enzi, Republican of Wyoming, had already planned to conduct on the

F.D.A.'s drug-approval process.

 

Tysabri was approved based on only the first year of data from two

trials that each lasted two years. Such accelerated approval is used

to speed the introduction of drugs for life-threatening or severe

diseases and is granted on the condition that the drug receives

further study after reaching the market.

 

Douglas Throckmorton, acting deputy director of the F.D.A.'s Center

for Drug Evaluation and Research, said yesterday that accelerated

approval had been appropriate for Tysabri.

 

" The product unequivocally has data that says it works on top of other

therapies, " Dr. Throckmorton said in an interview. " It makes

meaningful differences in people's lives. " He said the fact that the

potential problem was caught early shows " the process worked quite well. "

 

But Lawrence Steinman, a professor of neurology and head of immunology

at Stanford, said the F.D.A. should not have approved the drug on the

basis of only one year's data. He said the risk of serious infections

like P.M.L. was " unfortunately logical " given that Tysabri works by

interfering with the immune system.

 

" I'm shocked that it happened so soon, but I knew it was going to

happen sooner or later, " said Professor Steinman, who participated in

an early animal study that led to the development of Tysabri. Dr.

Steinman is a co-founder and director of Bayhill Therapeutics, a

company developing competing drugs for multiple sclerosis.

 

Dr. Steinman said he had expressed his apprehensions about the drug in

speeches and in an article in the journal Science in July and had been

asked by Biogen executives to tone down criticism of the drug.

 

Officials of Biogen, Elan and the F.D.A. said there was no evidence of

an increased risk of infections seen in the clinical trials until the

recent two cases arose.

 

Multiple sclerosis is an autoimmune disease in which the body's immune

system attacks its own tissues. In the case of multiple sclerosis, the

immune system attacks the myelin, the insulation around nerve cells.

The disease, which affects about 400,000 people in the United States,

is marked by symptoms including loss of muscle control, blurred vision

and fatigue.

 

Tysabri prevents immune system cells from leaving the bloodstream to

enter the brain, where they can attack nerve cell insulation. The drug

is also being tested as a treatment for two other autoimmune diseases

- the intestinal inflammation Crohn's disease, and rheumatoid arthritis.

 

P.M.L., the rare condition seen in the clinical trials, is caused by

the activation of the JC virus, which resides in latent form in about

80 percent of healthy adults. P.M.L. more typically arises in people

with compromised immune systems, particularly those with late-stage AIDS.

 

Activation of the virus results in removing the myelin from nerve

cells, making it somewhat similar to multiple sclerosis itself,

although far more deadly.

 

Burt A. Adelman, an executive vice president of Biogen, said the two

patients, a woman and a man in their late 40's, were from different

parts of the United States and, aside from their multiple sclerosis,

had been in generally good health. They were 2 of the 500 patients in

clinical trials who have taken Tysabri and Avonex together for more

than two years.

 

Mr. Mullen of Biogen said the company reported the first case of

P.M.L. to the Food and Drug Administration as soon as it had

information on it, on Feb. 18. The day before, Biogen had announced

new, favorable results from clinical trials of Tysabri. Executives

said they would review the medical records again of all the patients

in clinical trials. Those patients would get new magnetic resonance

imaging scans and physical examinations.

 

Dr. Adelman said the patients who had been treated with Tysabri for

the short time since it reached the market probably did not need

M.R.I.'s. Biogen executives said that they did not know how many of

those 5,000 people had been taking Tysabri along with Avonex but said

that surveys by Wall Street analysts suggested the figure might be

about a third.

 

Kelly Martin, president and chief executive of Elan, said that if no

further cases of P.M.L. were found, Tysabri sales could resume by the

fall. He said that while he could not speak for the F.D.A., " It is not

their intention to have this drug removed from the market. "

 

But Mr. Mullen of Biogen declined to speculate on when sales might resume.

 

Joel Sendek, an analyst with Lazard, predicted that Tysabri would not

come back until 2007 and that its label would contain a warning that

would dampen use of the drug. He also predicted the drug would be sold

for use alone, not with Avonex.

 

That would hurt Biogen because Tysabri might takes sales away from

Avonex. And while Biogen gets all the profits from Avonex, it splits

profits on Tysabri with Elan, which originally developed the drug.

 

The suspension of Tysabri sales is expected to bolster sales of rival

multiple sclerosis drugs. The main ones are Rebif, sold by Serono of

Switzerland and Pfizer; Copaxone, sold by Teva Pharmaceutical

Industries; and Betaseron, from Schering A.G. of Germany and Chiron.

 

Biogen Idec, formed in a 2003 merger, had $2.2 billion in revenues

last year led by Avonex and by Rituxan, a drug for non-Hodgkin's

lymphoma that is co-marketed with Genentech. But both those drugs have

been on the market a while and sales growth is slowing. Absent sales

of Tysabri, Biogen's next biggest opportunity for growth could come if

Rituxan succeeds in clinical trials as a treatment for rheumatoid

arthritis.

 

Copyright 2005 The New York Times Company