Friday, November 17, 2006

Novartis May Have News On US FDA Application

Dow Jones - Nov. 17, 2006

By Anita Greil


ZURICH (Dow Jones)--Swiss pharmaceutical Novartis AG (NVS) may tell a research and development presentation in London later this month that Tasigna - a possible successor to the company's successful leukemia drug Gleevec - has already been filed for its first approval by the U.S. Food and Drug Administration.

At the Nov. 28 London meeting Novartis will also showcase an oral multiple sclerosis drug and experimental asthma medicine. Including Tasigna, these three treatments are already in an advanced stage of development.

With a wealth of data on them already published on them, though, analysts will probably focus on the earlier stage pipeline.

"It has become difficult for healthcare companies to surprise at their R&D days," said Denise Anderson, pharmaceutical analyst in Zurich with brokerage Kepler Equities, who has a reduce rating on Novartis. "The strict disclosure rules of medical conferences and stock markets require the companies to publish important trial results as soon as they become known,"

As a result, analysts don't expect important new data on experimental multiple sclerosis capsule FTY720, which is in the third and usually last phase of clinical development. Novartis expects to file the drug for regulatory approval in 2009 at the earliest.

Meanwhile, Novartis has said it expects to submit Tasigna for regulatory approval this year after a study showed it worked well in patients who no longer responded to Gleevec, the company's second best-selling drug launched five years ago. If successful, Tasigna will compete with Bristol-Myers Squibb Co's (BMY) Sprycel, which has already been launched for the treatment of leukemia patients who don't respond to Gleevec.

All three drugs are so-called targeted cancer drugs, which work by killing cancer cells specifically, or by hindering their proliferation, while traditional chemotherapy often kills deranged and healthy cells alike, leading to troublesome side effects.

Novartis could also announce that it has moved the third of the advanced products, asthma drug QAB149, into phase three testing. QAB149, also known as Indacterol, is a long-acting beta-agonist which treats asthma by dilating airways and improving airflow. Novartis plans to file the drug for regulatory approval in 2008.

In August, Novartis and Schering-Plough Corp. (SGP) entered into a global agreement to develop and commercialize a fixed combination of QAB149 and the U.S. company's corticosteroid Asmanex for the treatment of asthma and smoker's lung. If successful the product would be the first once-daily fixed combination inhaler to compete with GlaxoSmithKline PLC's (GSK) Advair and AstraZeneca PLC's (AZN) Symbicort, both of which are twice-daily inhalers.

"At the R&D day, we expect Novartis will expand on the details of this collaboration," analysts at Lehman Brothers, who have an overweight rating on the stock told investors in a note. "Novartis could also announce the start of phase three trials of QAB149 monotherapy; however, we believe the focus of development for this product will be in combination."

Lesser known products likely to get some attention include osteoporosis drug balicatib and licarbazepine, or LIC477, for the treatment of bipolar disorder.

Balicatib, also known as AAE581, works by inhibiting a protein that is responsible for bone reabsorption and collagen breakdown. Given the size of the osteoporosis market, this experimental drug has the potential to become a blockbuster with annual revenue of more than $1 billion.

"Success or failure of this drug is likely to depend on the possibility of finding a dosing regimen which shows sufficient efficacy, but limited itching," said Lehman Brothers, referring to earlier trials that had shown itching to be a side effect.

Analysts are also mentioning LBH589 for solid tumors, OPC759 for dry eye, and NVA237 for smoker's lung, for which little data has been released so far.

"The late-stage assets are well known with material surprises unlikely, but the mid-to-late pipeline is less well characterized, and together with a review of the vaccine business and business development activities, could be a positive for the shares," said Citigroup analysts, who have a buy rating on the stock, in a note to investors.

Company Web Site:

-By Anita Greil, Dow Jones Newswires; +41 43 443 8044 ;

(END) Dow Jones Newswires

November 17, 2006 10:09 ET (15:09 GMT)