Merck & Co., Inc. (MRK) recently presented encouraging results on its phase III lipid management candidate anacetrapib. Results from a phase III study, DEFINE (Determining the EFficacy and Tolerability of CETP INhibition with AnacEtrapib), showed that treatment with the candidate resulted in a significant reduction in “bad cholesterol” and an increase in “good cholesterol”.
Study Results
The 18-month study was conducted with approximately 1,623 patients suffering from coronary heart disease or at a high risk of developing the same. The patients in the study were already receiving statins. The trial was conducted to evaluate the lipid-modifying efficacy, safety, and tolerability of the candidate.
Merck reported that treatment with anacetrapib resulted in a 40% decline in low-density lipoprotein cholesterol (LDL-C), which is often referred to as “bad cholesterol”. At the same time, anacetrapib helped increase high-density lipoprotein cholesterol (HDL-C) or “good cholesterol” by 138%.
Importantly, Merck said that there wasn’t a significant difference in changes in blood pressure between the anacetrapib and placebo treatment arms. Moreover, there were no significant changes in serum electrolytes or aldosterone levels. An increase in aldosterone level could result in higher blood pressure.
Results showed that about 16 people in the anacetrapib arm died or had heart attacks or strokes versus 21 people in the placebo arm.
Merck said that it intends to move anacetrapib into a large cardiovascular clinical outcomes study.
We note that Pfizer (PFE), which was developing a similar candidate, torcetrapib, had to halt development in 2006 due to an increased risk of death and cardiovascular events in patients who took the medication. Torcetrapib was a CETP inhibitor like anacetrapib. Pfizer was looking to get torcetrapib approved before the genericization of its lead cholesterol product, Lipitor.
Competitors
The cholesterol market represents significant commercial opportunity. We note that Pfizer’s Lipitor delivered sales of $11.4 billion in 2009. The successful development and approval of anacetrapib would be a major boost for Merck. However, the candidate is still several years away from commercialization and has to first navigate successfully through a large cardiovascular outcomes study.
Moreover, a competitor product could reach the market ahead of Merck’s anacetrapib. Roche’s (RHHBY) CETP inhibitor, dalcetrapib, is currently in phase III studies. Roche is most likely a couple of years ahead of Merck in the development process. While Roche is planning to file for approval of dalcetrapib in 2013, Merck could be in a position to file for approval in 2015.
Neutral on Merck
We currently have a Neutral recommendation on Merck, which is supported by a Zacks #3 Rank (short-term “Hold” rating). Merck is currently facing issues such as patent expirations of key drugs and EU pricing pressure. However, the company has a deep pipeline which should act as a cushion when its key products lose patent expiry in the next few years. Moreover, some of the company’s recent launches should start contributing significantly to the top line in the forthcoming quarters. Besides, the restructuring initiatives undertaken by the company should also improve its bottom line.
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