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Tuesday, July 2, 2019

Amarin Plans to Double Size of Sales Force to 800

Amarin Corporation, based in Bedminster, New Jersey and Dublin, Ireland, provided a mid-year update, noting that it is increasing revenue guidance for the year. It is also planning to dramatically expand its sales force for Vascepa (icosapent ethyl) because growth is faster than expected.
Vascepa is made up of a purified component of fish oil called eicosapentaenoic acid (EPA). The drug has been approved to treat patients with triglyceride levels higher than 500 milligrams per deciliter, triple normal levels.
Part of the company’s update was to remind everyone that it has a September 28 target action date with the U.S. Food and Drug Administration (FDA) for its supplemental New Drug Application (sNDA) for Vascepa for broader promotion of the drug. The sNDA is based on positive data from the REDUCE-IT cardiovascular outcomes trial. If approved, it will be the first drug to indicate it can decrease residual cardiovascular risk in patients with statin-managed LDL-cholesterol but persistently elevated triglyceride levels.

Amarin also reported record revenue levels. Net total revenue for the first quarter were $97 to $101 million and for the six-month mark, between $170 and $174 million. That’s an increase of about $44 to $48 million, or 84% to 92% for the second quarter 2019 over the same period of 2018 and an increase of $73 to $77 million, or 76% to 80% for the first half of 2019 over the same period last year. Those are mostly driven by Vascepa sales.
As a result, Amarin increased its net total revenue guidance for the year to $380 to $420 million.
And because of the growth of Vascepa, it plans to increase the size of its U.S. sales force to about 800 sales representatives. It hopes to have the expanded team hired, trained and in the field by October 2019. This will essentially double the size of its current sales force.
The company noted, “The size of the planned expansion reflects the result of evaluations involving multiple contributing factors. Previously Amarin had estimated the potential expansion of its sales force to reach between 600 and 800 sales representatives and for the expansion to potentially occur in phases. The decision to expand the sales to approximately 800 sales representatives by October 2019 was based on new information including the encouraging progress being made by sales representatives hired at the start of 2019, positive feedback from physicians with deep understanding of the REDUCE-IT data, additional data on the commercial opportunity that exists in detailing physicians who have not yet been educated about Vascepa and data suggesting that education of healthcare professionals regarding Vascepa will be improved if our sales representatives call on physicians with greater frequency.”
Last year, Amarin hired and deployed 265 new sales members within about three months after the REDUCE-IT trial data was reported. They received more than 20,000 applications for those open sales jobs. Based on that, as well as the Vascepa trial data, the company believes it can double its sales force to 800 by October.

In a crowded psoriasis field, who could nab Celgene’s Otezla—and at what price?

Antitrust regulators recently surprised industry watchers with the stipulation that Bristol-Myers Squibb sell Celgene’s Otezla to win U.S. clearance for its $74 billion merger. But since then, as there’s no way around it, analysts have pulled out their calculators trying to put a dollar figure on the drug.
Otezla could get Bristol about $5.4 billion, Bernstein analyst Ronny Gal said in a Monday note to clients. But his peers at Credit Suisse, Jefferies, RBC Capital and Wolfe Pharma are modeling around $8 billion to $10 billion.
As Gal put it: “This is primarily a question of IP.”
Most of the patents around Otezla expire in September 2023, Gal noted. There is one patent covering its use in psoriatic arthritis that expires in 2034, which Gal said could be bypassed because it’s a small carveout covered by what’s known as a “section VIII statement” under Hatch-Waxman, where a generic drugmaker can seek approval by carving out a protected indication.
The main controversy lies in a patent covering “optically pure” Otezla that expires in August 2028. While the other analysts based their calculations on Otezla exclusivity lasting at least into 2028, Gal argued the 2028 patent “has to be viewed as suspect given [composition of matter] expires earlier and ~20 generics challenged the patent.”
Gal figures a buyer could get away with paying the full price for the drug through the 2023 patent cliff and then for only 33% odds of it reaching 2028. Currently, consensus pegs Otezla’s 2020 sales at $2.06 billion, jumping to $2.42 billion in 2023 and then plateauing at $2.49 billion throughout 2028. After considering direct costs of $600 million—because psoriasis is a highly competitive market—and an acquirer tax rate of 20% and 7.5% discount rate, Gal arrived at $5.4 billion.

For RBC Capital Markets analyst Brian Abrahams’ team, annual revenue estimates for Otezla are largely in line with the Street’s average, though slightly higher. Abrahams applied a 9% discount rate that considers potential unfavorable IP developments and competition from TYk2 inhibitors, such as the BMS-986165 candidate that Bristol is keeping instead of the Celgene drug. Assuming exclusivity into 2028, “fair value would be $8B for the franchise, potentially as much as $10B with a modest premium in a competitive bidding situation,” he said in a June 25 investor’s note.
Jefferies analyst Michael Yee also put Otezla’s value at four to five times sales, or $8 billion to $10 billion, even though he acknowledged BMS may not fetch the high end given that buyers know the New York pharma has to sell the product.
Credit Suisse’s Vamil Divan expressed a similar opinion. “Given Bristol is a forced seller in this situation, we would be surprised if they obtain a significant premium for the asset, but the range of possible buyers suggests to us that they likely do not need to sell it at a significant discount either,” he noted recently. He said his shop’s database suggests Otezla is worth $9.3 billion.
Now, who could take Otezla over, especially given the U.S. Federal Trade Commission’s stricter stance on pharma M&A that caused the sale in the first place?

“[A] buyer presumably must not have too much direct overlap but yet is interested in immunology and dermatology,” Jefferies’ Yee said. “This seems to be threading a needle.” He figured some specialty pharma or European firms might pull it off, as most Big Biotech and Big Pharma companies already have direct competitors.
Novartis has Cosentyx, Amgen has Enbrel, AbbVie has Humira and Skyrizi, Eli Lilly has Taltz, and Johnson & Johnson has Tremfya, just to name a few. These companies might be interested, but the stress is on “assuming they do not see any regulatory concerns,” Credit Suisse’s Divan said. RBC’s Abrahams added Gilead to the list, saying that it could benefit from bolting on an immunology infrastructure ahead of the launch of its JAK1 inhibitor filgotinib.
For his part, Bernstein’s Gal argued “we can’t really see FTC limiting psoriasis companies with non-dominant share and only injectable (JNJ, BI, NVS, AMGN) or pipeline assets only (GILD).” He listed Gilead, J&J and Amgen as potential buyers.

Roth Capital Reiterates Buy Rating on Amarin

Roth Capital analyst Yasmeen Rahimi reiterated a Buy rating and $30.00 price target

Wright Medical down 7% on softer prospects for Cartiva implant

Wright Medical Group N.V. (WMGI -7.4%) slumps on more than double normal volume in response to “less positive” market feedback on its Cartiva synthetic cartilage implant designed to treat osteoarthritis in the big toe joint.
In a note, RBC Capital analyst Brandon Henry says some early adopting surgeons have reduced usage, adding that recent data appears to suggest that the device “may not be the panacea some initially hoped for.” He has lowered his fair value target to $34 from $36 while maintaining his Outperform rating.
Shares also sold off on June 20 after Wells Fargo said a number of doctors had temporarily stopped using Cartiva due to concerns with durability.

Medical Properties up 4% on bullish SunTrust call

Citing the potential for Medical Properties Trust (MPW +3.6%) to capitalize on its “large acquisition pipeline,” SunTrust’s Michael Lewis upgrades the stock to Buy with a $20 (11% upside) price target.
Mr. Lewis likes the upside from domestic deals considering the lower valuations.

Ritter up on advancement of RP-G28

Ritter Pharmaceuticals (NASDAQ:RTTRreports that the last participant in its Phase 3 Liberatus study evaluating RP-G28 for the treatment of lactose intolerance has completed the final visit.
Topline data should be available in Q4.
Shares were up 6% premarket on average volume.

Topical Probiotics for Atopic Dermatitis and Eczema

Atopic dermatitis is an inflammatory disease of the skin in which the normal barrier function of the skin is disrupted, so that immune function is impaired and susceptibility to infection with common bacteria like Staphylococcus aureus is increased.

This invasion by pathogenic microbes in turn leads to a disturbance in the numbers and relative proportions of various microbial species that live as commensal organisms on the skin, causing cutaneous dysbiosis.

Why is eczema treatment so urgent?

Atopic dermatitis is a common skin disorder, affecting about one in five children in developed nations. Moreover, it can profoundly disturb the individual’s quality of life and healthcare expenditures. Furthermore, atopic dermatitis is associated with development of asthmaallergic rhinitis, and food allergies. Children will often not cooperate with the multiple applications and oral medications that make up its treatment at present, and either way, their quality of life is decreased. More effective biologics are now available but the cost is still steep, putting it out of reach in many places.
Atopic dermatitis (AD), also known as atopic eczema. Image Credit:  LIAL / Shutterstock
Atopic dermatitis (AD), also known as atopic eczema. Image Credit: LIAL / Shutterstock
Its incidence is shooting up in more developed nations, but most affected people will experience a marked reduction in symptoms around the time of puberty.
The chronic risks do not stop here, however, for the long duration during which the skin fails to provide a proper barrier to the invasion of foreign microbes and the removal of moisture takes its toll in the subsequent development of a hypersensitive skin which reacts to many other antigens.

How does the skin microbiota affect eczema?

Theoretically, topical and preventive oral antibiotics against S. aureus should be effective in treating atopic dermatitis. However, many studies have shown the reverse, so antimicrobial treatment are not part of standard treatment. It may be that there are more microbes to consider than just S. aureus (a gram-positive bacterium) in the pathogenesis of this disorder. Gram-negative bacteria on the skin are lower in skin areas most commonly affected by eczema compared to healthy persons.
Earlier studies have shown how important the skin microbiome is in eczema. Mapping the locations of skin Gram-negative bacteria revealed a stunning overlap with the sites where eczema typically breaks out – the antecubital fossa (front of the elbow) and the back of the knees, for instance. This suggests that when the wrong strains of certain bacteria replace the beneficial ones, atopic dermatitis may result. This led to scientists trying to correct the skin microbiome to treat eczema.

Spraying skin with bacteria successfully treats eczema

A recent experimental study used a Gram-negative commensal bacterium, Roseomonas mucosa, taken from the skin of healthy volunteers as well as from people with the condition. This microbe was studied on cell cultures and in mice.
Interestingly, in cell cultures R. mucosa killed S. aureus, while in mice it enhanced the skin’s barrier function, keeping it hydrated and preventing the entry of pathogens. Moreover, it also improved atopic dermatitis rashes in mice.
In a small human trial, the treatment improved the immune status of skin cells. However, the R. mucosa cultured from the skin of people with atopic dermatitis had a negative or no impact on the rashes.
During the first part of the trial, designed to look at the effectiveness and safety of the therapy, a mix of three live R. mucosa strains collected from healthy volunteers, dispersed in 10% -15% sucrose solution (sugar water), was sprayed on two skin sites, one in the front of the elbow and the other site chosen by the patient) by the adult subjects in preset increasing doses, from 103 to 105 colony-forming units (CFU) at each treatment site, twice a week for 6 weeks.
In the second part of the trial, five children were enrolled and treated with the same dose regimen for 12 weeks. From weeks 13-16, the treatment was escalated to once every alternate day.

Important findings

The findings of this trial, early though it is, were remarkable in some ways. For one, the administration of R. mucosa in mice was not associated with any toxicity, and there were no reported problems or adverse effects in humans either. The investigators found that both patient symptoms like itching and objective signs of the disease were significantly reduced. Steroid applications were decreased.
Secondly, the present trial achieved a treatment response beyond the minimum required effect level that is statistically significant for treatment effect, that is, >50% improvement in the SCORAD. This is in comparison to the historical placebo effect of 5% to 30%.
In children treated with topical probiotics, this level of improvement was seen in almost 80% of patients; 85% of treated adults also improved.
The overall number of patients who showed clinical improvement (68%) was greater than the 27% who would normally be expected to improve in accordance with the natural history of the disease.
All responders showed continued benefit even after the washout phase, with some manifesting additional improvement.
Strain-specific R. mucosal metabolites can promote dysbiosis in atopic dermatitis by decreased production of phospholipids which damage the epithelial barrier, compounds like histidinol, and monomethylgluterate, which irritate the epithelium, and reduce skin immunity. Thus providing topical “good” strains of R. mucosa could be of benefit to humans with atopic dermatitis in all these aspects.
The growth of beneficial R. mucosa is also affected by skin exposure to compounds like parabens which are commonly used as preservatives in soaps and skin products, but not that of S. aureus or R. mucosa from diseased skin. On the other hand, dilute bleach selectively inhibited S. aureus and R. mucosa from diseased individuals, but not from healthy volunteers.

Which patients are less likely to respond?

Responders were less likely than non-responders to have a family history of adult atopic dermatitis or at least three generations affected by atopic dermatitis.

Conclusion

This small preliminary study suggests several implications.
Different strains of R. mucosa produce different effects on the skin in patients with atopic dermatitis. When taken from normal volunteers with healthy skin, these organisms may produce clinically significant benefit in terms of improvement of skin rashes and itching, which is not seen when the organisms is isolated from the unaffected patches of skin in individuals with eczema.
The topical application of the bacteria may help restore the epithelial barrier function, correct the imbalance between innate and adaptive immunity, and restrict the growth of S. aureus leading to a lower population of this organism.
Genetic factors may also affect the response to treatment using R. mucosa.
Certain skin products may worsen atopic dermatitis by affecting the colonization of beneficial R. mucosa strains but not of pathogenic strains of S. aureus.
The next step will be to conduct a placebo-controlled trial for patients with atopic dermatitis to confirm or disprove these findings.

Sources