Eli Lilly (LLY) is a step closer to gaining approval from the US Food and Drug Administration (FDA) for expanded use of one of its key drugs, Cymbalta. The FDA’s nesthetic and Life Support Drugs Advisory Committee recently voted 8-6 in favor of approving Cymbalta for expanded use.
Eli Lilly is seeking approval for the use of Cymbalta for the management of chronic low back pain and treatment of chronic pain due to osteoarthritis. The advisory panel was also asked to vote on whether sufficient data was available to support efficacy of the drug for both indications. While the panel voted that enough data was available in support of the chronic low back pain indication, the same was not so in the case of the osteoarthritis indication.
The panel also said that there was not enough evidence supporting the use of a 120 mg dose instead of the 60 mg dose.
Importantly, the panel voted in favor of Cymbalta’s overall safety profile which was a matter of concern. The panel had been asked to pay special attention to the incidence of hepatotoxicity (liver damage) associated with the use of Cymbalta.
FDA Approval will Boost Sales
Eli Lilly has been working on expanding Cymbalta’s label for the chronic pain indication though without much success. The company had initially filed for approval for this indication in May 2008. However, Eli Lilly had to withdraw the application in Nov 2008 as questions were raised regarding the efficacy results that were submitted by the company. The company, subsequently, resubmitted its application in June 2009 with additional data.
Cymbalta, approved for several indications, is a major contributor to Eli Lilly’s top-line. It is currently approved for the treatment of diabetic peripheral neuropathic pain (“DPNP”), fibromyalgia (“FM”), major depressive disorder (“MDD”), and generalized anxiety disorder (“GAD”) in adults. Cymbalta sales came in at $3.07 billion in 2009, accounting for 14% of total revenues. Additional indications should help drive sales further.
It is estimated that although more than 45 million Americans suffer from chronic pain, only one-fourth of the people suffering from chronic pain receive proper treatment. Currently used treatments include non-steroidal anti-inflammatory drugs (NSAIDs), opioids, and COX-II inhibitors. Cymbalta’s approval for the chronic pain indication would expand the patient base for the drug significantly.
The news about the advisory panel backing Cymbalta’s label expansion comes as a breath of fresh air for Eli Lilly which has been on the receiving end of a series of negative news over the last few weeks. In addition to receiving unfavorable rulings in patent infringement cases related to Gemzar and Strattera, Eli Lilly faced a major pipeline setback recently when it had to halt the development of its late-stage Alzheimer’s disease candidate, semagacestat, based on disappointing preliminary results from two ongoing phase III studies.
FDA approval for the expanded use of Cymbalta would be a major boost for Eli Lilly. Cymbalta should remain a significant contributor to revenues until it loses patent exclusivity in 2013.
Neutral on Eli Lilly
Several major products in Eli Lilly’s portfolio are scheduled to lose patent protection in the next few years and the company needs to bring new products to market so as to help make up for the loss of revenues that will take place once products like Zyprexa lose exclusivity.
Barring significant cost-cutting efforts or additional revenue catalysts, 2013 will be the beginning of a very challenging period with Cymbalta losing US patent protection during the year. On the flip side, strong performance of the diabetes business, the ramp of Effient and upside from the Incline deal should offer some downside support. We are also pleased to see Eli Lilly pursuing small acquisitions and in-licensing deals to boost its pipeline. We currently have a Neutral recommendation on Eli Lilly, which is supported by a Zacks #3 Rank (short-term “Hold” rating).
