Amgen (AMGN) recently presented encouraging long-term data on Prolia. Results from a long-term study showed that postmenopausal women with osteoporosis continued to experience statistically significant, year-over-year increases in lumbar spine and total hip bone mineral density (BMD) during the fourth and fifth years of treatment with Prolia.
Detailed Data
Data from the FREEDOM (Fracture REduction Evaluation of Denosumab in Osteoporosis every 6 Months) study showed that women taking Prolia experienced an additional 1.9% and 1.7% increase in lumbar spine BMD and an additional 0.7% and 0.6% increase in total hip BMD, in the fourth and fifth years of treatment, respectively.
Meanwhile, patients who had shifted from placebo to Prolia in the study showed a significant increase in BMD in the first two years of treatment with Prolia. While lumber spine BMD increased 7.9%, total hip BMD increased 4.1%.
Amgen said that the overall adverse event profile remained similar in the fourth and fifth years of treatment. Amgen presented these long-term data at the annual European Congress Osteoporosis and Osteoarthritis.
Prolia/Xgeva Could be a Blockbuster
Amgen received a major boost in 2010 when it gained approval for Prolia/Xgeva (denosumab). While Prolia gained approval in the EU for the treatment of osteoporosis in postmenopausal women at increased risk of fractures and the treatment of bone loss associated with hormone ablation in men with prostate cancer at increased risk of fractures, the US Food and Drug Administration (FDA) approved the product for the treatment of osteoporosis in postmenopausal women at increased risk of fractures or patients who have failed or are intolerant to other osteoporosis treatments.
Based on encouraging phase III results, we believe Prolia has the potential to capture a major share of the osteoporosis market, which represents a huge commercial opportunity.
Denosumab gained US approval under the trade name, Xgeva, for the prevention of skeletal-related events (SREs) in patients with bone metastases from solid tumors. A response regarding Xgeva’s approval status in the EU is yet to come. The clinical results on Prolia/Xgeva so far are positive for the company, and reinforce our belief that the drug could be a blockbuster.
Amgen is currently working on gaining formulary coverage for the product. Improved formulary status would help drive Prolia/Xgeva sales. Meanwhile, Amgen launched and gained full reimbursement for Prolia in nine countries in 2010. Launches in additional countries throughout 2011 should help drive ex-US sales.
Amgen continues to pursue additional indications for denosumab. Xgeva sales should receive a major boost if Amgen succeeds in gaining approval for the prevention of bone metastases in prostate and breast cancer patients. Amgen intends to file for approval of this new indication in the first half of 2011.
Amgen has a collaboration agreement with GlaxoSmithKline (GSK) whereby both the companies will share commercialization of Prolia for osteoporosis indications in Europe, Australia, New Zealand and Mexico. Glaxo also has the right to commercialize denosumab for all indications in countries, excluding Japan, where Amgen does not have a commercial presence, including countries like China, Brazil, India, Taiwan and South Korea.
Neutral on Amgen
We currently have a Neutral recommendation on Amgen, which is supported by a Zacks #3 Rank (short-term “Hold” rating). Amgen has a lot riding on the successful commercialization of Prolia/ Xgeva.
We are bullish on Prolia/Xgeva, but any hiccup, either with respect to delays in gaining approval for additional indications, a miss in any of the ongoing phase III programs, delays in the reimbursement coverage process or safety concerns post-launch, will weigh heavily on the shares. We expect investor focus to remain on the successful launch and commercialization of Prolia/Xgeva.
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