With the dip in Celgene’s share price, we see this as an opportunity for investors. This year should be a strong year for Celgene with multiple catalysts, such as efficacy data at this year’s annual American Society of Clinical Oncology (ASCO) meeting from Revlimid’s E4A03 trial. This data could drive greater penetration and duration for Revlimid as a therapy in multiple myeloma (MM). Celgene will start Phase III programs in non-Hodgkins lymphoma (NHL) and chronic lymphocytic leukemia (CLL) later this year. Combined, these indications could double Revlimid’s peak sales potential. Celgene currently has two applications with the European Medicines Agency (EMEA) regarding Revlimid, one for the use of Revlimid in myelodysplastic syndrome (MDS) and the other in MM. For Celgene to grow as expected, Revlimid must receive approval for MDS and relapsed refractory MM in the EU. A decision on these two settings should come sometime in the first half of 2007, probably toward mid-2007. Even though the decision from the EU is likely to be positive, significant sales from Revlimid in Europe won’t happen until 2008.
Efficacy data from the key front-line MM ECOG study (Revlimid + low-dose dexamethasone vs. high-dose dexamethasone) should be presented at the upcoming ASCO meeting in June. Compelling safety data was presented in December 2006 at the American Society of Hematology (ASH) meeting, with the low-dose regimen showing a dramatic benefit in mortality rate, thrombosis and infection. A modestly lower response rate from the low-dose dexamethasone arm could accelerate
Revlimid into the front-line MM setting. Management has indicated they would pursue the shortest route to approval in this setting. However, the FDA may need to see some clinical benefit data, such as time to progression before handing out any approvals. In this case, a filing could be made mid-2008 with an approval coming no sooner than early 2009.Revlimid in CLL represents a key growth driver for Celgene. Revlimid is currently in a 310-patient Phase II/III trial, in CLL patients with prior alkylating agent who have failed fludarabine. Celgene expects initial data from the trial in 2008. Separately, Celgene expects to submit a Phase III protocol this month under the special protocol assessment process, to study Revlimid vs. placebo as maintenance therapy to delay patient progression following fludarabine-containing regimens. The company is also planning first-line trials testing Revlimid as monotherapy in symptomatic, untreated patients, as well as in elderly patients not suitable for fludarabine treatment. Celgene also plans to look at Revlimid in combination with Rituxan in untreated and relapsed patients. Based on the impressive preliminary data from two separate single-center studies, Revlimid has market potential as a treatment in CLL.
A pivotal Phase III trial for NHL could also begin in the first half of 2007 if the company can obtain a special protocol assessment from the FDA in the next few months. So far Phase II data on Revlimid are comparable, to Biogen-Idec’s Rituxan as a monotherapy in relapsed or refractory aggressive NHL. However, there was worse myelosuppression as compared to Rituxan’s could be an issue in a larger trial. When both Revlimid and Rituxan are used as monotherapies, they have shown only moderate efficacy in second-line treatment for aggressive NHL. Currently, the company is running a Phase II trial known as NHL-003. The trial, a single-arm study testing the 25 mg dose of Revlimid in relapsed/refractory, aggressive NHL patient, is expected to enroll 128 patients. The primary endpoint of the trial is response rate, with secondary endpoints of tumor control rate, duration of response, time to progression and progression-free survival. Data from this trial should be available later this year.
Celgene plans to initiate Revlimid trials in prostate and thyroid cancers in 2007. The company had previously announced that several Phase I and II studies are ongoing in several tumor types, including melanoma (Revlimid plus DTIC in chemo-naïve patients), ovarian (Revlimid plus doxorubicin in chemo-refractory patients), lung (Revlimid single-agent in third-line patients), and glioblastoma (Revlimid plus radiation in newly diagnosed patients).Celgene’s 2007 total revenue guidance is $1.3 billion and EPS around $1.00 which is beatable because of potential upside for Revlimid’s sales.
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