September 17, 2008 Denosumab data continues to improve Amgen's outlook Evaluate Vantage News that denosumab may be all its cracked up to be as a major new treatment for osteoporosis helped drive Amgen’s shares to an 18-month high yesterday of $65.89, suggesting that the biotech giant is emerging from a tough period in which the prospects for its all-important EPO franchise have been significantly reduced. In an increasingly competitive field, following the launch this year of generic versions to Merck & Co’s blockbuster bisphosphonate treatment Fosamax, denosumab is the primary reason the osteoporosis market is expected to grow 3% annually from $10.5bn last year to $13.4bn by 2014. If denosumab, with sales of $2.87bn forecast for 2014, does go on to dominate the market and the antibody-based approach to treating osteoporosis proves successful, Amgen may have stolen a march on its competitors, as there is little in the industry’s pipeline to challenge the drug over the next ten years. Positive confirmation The data on denosumab released at the 2008 American Society of Bone conference this week is a full read out of positive top-line results announced at the end of July (Amgen receives well-needed Denosumab boost, July 28, 2008). Denosumab, an antibody which targets the RANK ligand that is involved in breaking down bone, demonstrated a 68% reduction in spinal fractures and a 40% reduction in hip fractures, in postmenopausal women. The reduction in vertebral fractures with twice-yearly injections of denosumab is significantly higher than oral once-weekly Fosamax and similar to a once-yearly injection of Novartis’ bisphosphonate Reclast. However, the reduced rate of hip fractures of 40% is actually lower than Fosamax’s listed 50% rate and could be of concern when the FDA reviews denosumab next year. Amgen will therefore be keen to stress the positive outcomes of the DECIDE trial of 1,189 healthy postmenopausal women which revealed a significant preference for twice-yearly injection compared to a weekly oral tablet. Pipeline competitors Denosumab dominates the pipeline of bone calcium regulators and the company will be hoping the drug’s novel mode of action means it avoids the safety pitfalls that have already snared Wyeth’s Viviant, which belongs to another significant class of drug used to treat osteoporosis, selective oestrogen receptor modulators (SERMs). Annual Bone calcium regulators - R&D pipeline, top 5 candidates ranked by sales in 2014 sales ($m) Pharmacological Current Product Generic Name Company 2010 2014 Class Phase Denosumab 1 denosumab Anti-RANKL MAb Amgen Phase III 488 2,866 (AMG 162) Selective oestrogen 2 Arzoxifene arzoxifene receptor modulator Eli Lilly Phase III 40 431 (SERM) Selective oestrogen 3 Viviant bazedoxifene receptor modulator Wyeth Phase III 89 346 (SERM) becaplermin Augment Platelet-derived growth BioMimetic 4 & beta-tricalcium Phase III 22 323 OS1 factor (PDGF) Therapeutics phosphate 5 751689 ronacaleret Calcium antagonist GlaxoSmithKline Phase II - 234 Should monoclonal antibodies prove to be the success story for treating osteoporosis, denosumab appears a long way ahead of any potential antibody competitors within the market. In fact, Amgen looks to have ring- fenced this opportunity as the company also holds the rights to the only other candidate in clinical trials, the anti-sclerostin antibody AMG 785, licensed from Celltech in 2002. Monoclonal antibody bone calcium regulators in development Current Phase Product Pharmacological Class Originator Company (s) Phase III Denosumab (AMG 162) Anti-RANKL MAb Amgen Amgen Phase I AMG 785 (CDP7851) Anti-sclerostin MAb Celltech Amgen + UCB Pre-clinical TNX-717 Anti-SARP2 MAb Tanox Wyeth + Genentech Research project Bone disease program Anti-osteoporotic MAb Ablynx Ablynx Partnering opportunity? Amgen depends heavily on the future commercial success of denosumab, which is currently valued at $8.05bn, according to EvaluatePharma’s NPV Analyzer, representing at least 12% of the company’s latest share price and the group’s fourth most valuable drug overall. This valuation is based on the assumption that Amgen goes it alone in commercialising the drug in the US and Europe; the company has already licensed Japanese rights to Daiichi Sankyo. However, given that Amgen will have to build a new sales force to market denosumab to primary care doctors, virgin territory for the biotech giant, many have suggested that the company may be better off signing up a big pharma partner to help extract maximum value from this opportunity. So far Amgen’s senior management have tried to pour cold water on the chances of a deal materialising, particularly in the US, but a European partner remains a distinct possibility. More from Evaluate Vantage Evaluate HQ 44-(0)20-7377-0800 Evaluate Americas +1-617-573-9450 Evaluate APAC +81-(0)80-1164-4754 © Copyright 2021 Evaluate Ltd..