Biogen Inc.’s Tecfidera (dimethyl fumarate) stands as proof that the blockbuster drug is alive, if perhaps not exactly kicking in 2013. The drug was the break-out star among the new drugs that launched during the year and the only one to stand out from the group on sales metrics.

Tecfidera, an oral pill for multiple sclerosis, appears to have generated sales approaching $1 billion in 2013 after just nine months on the market (official annual sales tallies aren’t yet available).

The drug brought in $478.5 million for Biogen Idec from its launch in April through September, surpassing analyst expectations and Biogen’s own internal forecasts. Deutsche Bank analyst Robyn Karnauskas said in a Dec. 30 research alert that based on weekly sales data from the market research firm IMS Health, Tecfidera appears to be tracking at $359 million to $365 million in sales in the fourth quarter. Karnauskas forecasts sales of the product will be $835 million to $841 million in 2013.

If that is the case, Tecfidera will have outpaced first-year sales of Regeneron Pharmaceuticals Inc.’s Eylea (aflibercept) for age-related macular degeneration, regarded as one of the most successful recent drug launches. Eylea debuted in late 2011 and generated sales of $838 million in 2012, a full 12 months of sales. Tecfidera appears on track to surpass $1 billion in sales in its first 12 months on the market.

The early success of Tecfidera also harkens back to Vertex Pharmaceuticals Inc.’s hepatitis C drug Incivek (telaprevir), which generated $950.9 million in sales the year of its launch in mid-2011. Vertex hasn’t been able to sustain the sales momentum for Incivek, however, as warehoused patients were treated and as patients await the first all-oral regimens, the first of which was approved in December 2013, Gilead Sciences Inc.’s Sovaldi (sofosbuvir). Incivek generated only $447 million in the first nine months of 2013, less than half what it generated in the first nine months of 2012.

Nonetheless, these cases show the right drug, addressing a high unmet medical need and priced in a way that patients and payers perceive as offering fair value, can indeed be a commercial standout. Drugs like Tecfidera, Eylea and Incivek also demonstrate the growing influence of biotech in the commercial realm.

“Biogen Idec did a fantastic job here,” said Alan Gray, senior director-commercial development at the life sciences consulting firm Kantar Health. “They really hit a big market for MS patients that relapse. They packaged their MS franchise very well to address that, and more importantly, the pricing strategy offered a real value proposition.”

The company introduced Tecfidera at a price just below Novartis AG’s Gilenya (fingolimod), the first oral drug for the treatment of MS, which launched in 2010; the difference in price amounts to about $5,000 less a year for Tecfidera Also see "Biogen Idec Undercuts Gilenya With $55,000 Yearly Price For Tecfidera" - Pink Sheet, 1 April, 2013.. Regeneron did something similar with Eylea, pricing the drug on a per dose basis just below the market leading brand Lucentis (ranibizumab), despite the fact that Eylea offers a dosing advantage over its rival. As a result, the cost of Eylea is about $13,000 less than Lucentis during a patient’s first year for the treatment of wet-AMD Also see "Regeneron Plays It Safe With Eylea, Aims To Undercut Lucentis" - Pink Sheet, 28 November, 2011..

“That is the kind of approach you have to take nowadays to think about the right value proposition, thinking about the patient, thinking about the payers, addressing the barriers and then executing upon that,” Gray said.

Softer Launch Trajectories In 2013

Tecfidera was the exception in 2013, not the rule. No other new drugs flew out of the gates with as much speed, and only one other generated more than $100 million in sales in the first months of launch.

“2013 was not a year of blockbuster products,” said Campbell Alliance’s Michael Turner, senior VP. “2013 had fewer launches and overall, companies are taking a much more specialized approach.”

FDA approved 27 new molecular entities and novel biologics in 2013, down significantly from the 15-year high of 45 NMEs and NBEs approved in 2012 but more in line with historical averages ([A#00140106010]).

Drugs To Watch From 2013’s Launch Class

Drug/Manufacturer

Indication

Launch Month

U.S. Sales (Launch Through October)

Pomalyst (pomalidomide)/Celgene

Multiple myeloma

February

$91.5 million

Kadcyla (ado-trastuzumab emtansine)/Genentech

Metastatic breast cancer

February

$201.1 million

Tecfidera (dimethyl fumarate)/Biogen Idec

Multiple sclerosis

April

$595.4 million

Invokana (canagliflozin) Johnson & Johnson

Type 2 diabetes

April

$71.2 million

Xofigo (radium Ra 223 dichloride)

Bayer Healthcare/Algeta

Prostate cancer

June

$31.6 million

Mekinist (trametinib)

GlaxoSmithKline

Metastatic melanoma with BRAF mutations

June

$9.1 million

Tafinlar (dabrafenib)

GlaxoSmithKline

Metastatic melanoma with BRAF mutations

June

$9.8 million

Belviq (lorcaserin)

Eisai/Arena

Obesity

June

$12.2 million

Breo Ellipta

(vilanterol/fluticasone)

GlaxoSmithKline

COPD

October

N/A

Imbruvica (ibrutinib)

J&J/Pharmacyclics

Mantle cell lymphoma

November

N/A

Gazyva (obinutuzumab)

Genentech

Chronic lymphocytic leukemia

November

N/A

Sovaldi (sofosbuvir)

Gilead Sciences

Hepatitis C

December

N/A

Source: Sales data provided by IMS Health

Not every drug approved in 2013 launched during the year. For example, GlaxoSmithKline PLC’s Anoro Ellipta (umeclidinium/vilanterol), the first combination long-acting muscarinic antagonist (LAMA) and long-acting beta2-adrenergic agonist (LABA) approved in the U.S. for chronic obstructive pulmonary disease, was approved Dec. 18 and was the last drug of the year to clear FDA Also see "With Anoro, GSK Takes A Two-Step Toward Bolstering Respiratory" - Pink Sheet, 23 December, 2013.. Anoro is slated to launch in the first quarter of 2014.

Others like Gilead Sciences Inc.’s Sovaldi (sofosbuvir) for hepatitis C and Johnson & Johnson/Pharmacyclics Inc.’s Imbruvica (ibrutinib) for mantle cell lymphoma entered the market late in the year following FDA approval in December and November, respectively. Both were granted “breakthrough therapy” designation by FDA and are expected to be important new medicines and significant revenue generators. The launches are just under way, however, and so it is too early to draw any definitive conclusions about the drugs’ performance.

On the other hand, a few drugs approved in 2012 launched in 2013, including Bristol-Myers Squibb Co./Pfizer Inc.’s oral anticoagulant Eliquis (abixaban), NPS Pharmaceuticals Inc.’s Gattex (teduglutide) for the rare disease short bowel syndrome, and Eisai Co. Ltd./Arena Pharmaceuticals Inc.’s obesity pill Belviq (lorcaserin).

The year’s launches continue to reflect industry’s increased investment in specialty markets, with many of the new drugs launching into specialty categories like oncology and hepatitis C. In broader disease areas, the group did include two new drugs for type 2 diabetes, including the first SGLT-2 inhibitor Invokana (canagliflozin) from J&J and a fourth to market DPP-4 inhibitor Nesina (alogliptin) from Takeda Pharmaceutical Co. Ltd.

Some of the more successful launches based on sales and early on in the year were in oncology, namely Roche Genentech Inc.’s Kadcyla (ado-trastuzumab emtansine), an enhanced version of its blockbuster breast cancer drug Herceptin (trastuzumab) ([A#00130304002]). The drug generated U.S. sales of $200.1 million from its launch in February through October, according to IMS, making it the second top-selling launch behind Tecfidera in 2013.

Celgene Corp.’s Pomalyst (pomalidomide) generated $91.5 million in U.S. sales from its launch in February through October, according to IMS. The drug was approved in February for the treatment of multiple myeloma after two prior failures and surpassed analysts’ expectations in its first months on the market Also see "Celgene Has A Swift Start For Pomalyst Launch" - Pink Sheet, 25 April, 2013.. Along with Imbruvica, Gazyva (obinutuzumab), another oncologic from Genentech, was approved late in the year (November) and is expected to be a strong contender in the market. Gazyva is indicated for the treatment of chronic lymphocytic leukemia and is intended as a follow up to the blockbuster Rituxan (rituximab).

“Launch trajectories have definitely softened,” said IMS Health’s William McClellan, senior principal, lead-Center of Excellence for Launch. “We saw a little bit of a rebound in those trajectories in 2010, 2011 and 2012, driven by some pretty high-profile launches like Incivek....What we see in 2013 is that it is starting to soften again.” IMS measures launch trajectories based on average dollar sales of all new drugs, including branded generics, on a monthly basis. The database includes about 72 new products that are being tracked in the U.S.

“If we look at launch trajectories, [2013] is actually the third best in the last 13 years, but it is driven by one product,” McClellan said. “If you remove Tecfidera from that what you find is it is probably of the last seven years, the sixth weakest.”

Eliquis Sales Pick Up

Bristol/Pfizer’s Eliquis was expected to be a surefire hit when it launched in January, but its early sales lagged and it failed to meet the companies’ launch expectations. Bristol reported just $12 million in sales from Eliquis in the second quarter, its first full quarter on the market in the U.S. Also see "As Eliquis Sales Lag, Bristol/Pfizer Take Action" - Pink Sheet, 25 July, 2013..

The oral anticoagulant was approved by FDA in December 2012 for stroke prevention in patients with atrial fibrillation, but was the third new oral entrant to the market behind Boehringer Ingelheim GMBH’s Pradaxa (dabigatran) and J&J/Bayer AG’s Xarelto (rivaroxaban). The competition, which also includes generic warfarin, has proved challenging for Eliquis, a surprise mainly because the drug’s safety and efficacy profile appear to position it as potentially best in class.

More recently, however, the drug’s sales have quickened, likely helped by increased marketing initiatives by the two big pharmas, including the launch of a direct-to-consumer advertising campaign in September. The drug generated U.S. sales of $62.7 million from January through October, according to IMS, with a noticeable jump in sales occurring in September. In September and October, IMS data show that sales in the U.S. were $26.9 million.

Pfizer’s Xeljanz (tofacitinib) has also gotten off to a slower start than some investors expected. FDA approved the janus kinase inhibitor in November 2012 for rheumatoid arthritis as the first oral next-generation disease-modifying drug in a multi-billion therapeutic area dominated by injectable tumor necrosis factor inhibitors like AbbVie Inc’s Humira (adalimumab) and Amgen Inc.’s Enbrel (etanercept). The bulk of its launch took place in 2013, however. It generated $72.6 million in the U.S. from January through October, according to IMS.

But given the high level of patient and physician comfort with existing biologic drugs and the fact that Xeljanz comes with serious side effects, some industry observers say the launch may not be underperforming as much as investors think. The ultimate potential of Xeljanz may rest in how successfully Pfizer is able to switch patients to it over the long-term.

“Sometimes the expectations are more robust then what the reality is,” said Kantar’s Gray in reference to Xeljanz. “I think Pfizer was well aware of [the challenges]. They know what they are doing.”

McClellan agreed. “They are probably right in line to where they should be, based upon the level of competition in the market, the level of quality of the products in the market, [and] the nature of rheumatologists being conservative,” he said.

The obesity category also has failed to live up to expectations. Eisai/Arena’s Belviq, launched in June, did little to energize the category, which faces high reimbursement hurdles and requires significant physician and patient education. Belviq is the second new obesity drug to reach the market in the last 18 months, behind Vivus Inc.Qsymia (phentermine/topiramate ER), which went on the market in 2012. Belviq was similarly approved by FDA in 2012, but its launch was held up nearly a year due to scheduling by the Drug Enforcement Agency as a controlled substance ([A#14130508002]).

Given the slow take off of Qsymia, Belviq is not as far behind as Eisai and Arena may have feared. Any hopes Belviq would quickly recharge the category haven’t panned out, however; the drug generated $12.1 million in sales from June through October, according to IMS.

As industry moves deeper into niche specialty markets and faces more hurdles to patient access on the commercial front, the definition of launch success is changing. The historical benchmark to determine success was $200 million in first-year sales, a figure that generally meant the product was headed toward blockbuster status.

“If it takes a lot of effort to get to that $200 million and a lot of resources, and your margins aren’t that good, then you have to start wondering if that $200 million is the right metric,” said Kantar’s Gray. A more productive model might be a product like Imbruvica, he said, which if J&J successfully penetrates the relatively small mantle cell lymphoma patient population and expands the drug into new indications like chronic lymphocytic leukemia as it plans, could build into a blockbuster over time.

“It’s that whole picture you want to look at, not just $200 million,” he said. “That old metric may not be as valuable as it was.”

But first-year sales are a straightforward measure investors can count on. More nuanced metrics may not be as convincing. It’s Biogen Idec’s stock that ended 2013 up 88% after all.

Tecfidera Stands Out From The Pack Of 2013 Drug Launches

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