I’ve been thinking about the potential for competition between Depomed’s (DEPO) Gralise (gabapentin extended release) and XenoPort’s (XNPT) Horizant (gabapentin enacarbil). The U.S. PDUFA for Horizant is April 6, 2011. I do not see the two competing head-to-head, at least not for post-herpetic neuralgia (PHN). The approval (if it happens) and launch of Horizant should have minimal impact on Depomed’s plans with Gralise, at least for the near-term.
First, Depomed is planning on targeting neurologist and pain specialists with Gralise. These 12,000 or so Docs make up 60%-70% of the PHN market. Restless leg syndrome (RLS) is a psychatric and primary care indication. Even if Horizant gets approved, you will not see any Glaxo (GSK) reps calling on pain docs with Horizant. There may be some slgiht overlap between neurologists and psychiatrists, but I see this as minimal. RLS and PHN are too distinctive. There’s minimal overlap on detailing between the two drugs.
Of course, if Depomed signs a new primary care co-promotional agreement with a pharmaceutical partner on Gralise, then you will see two reps going head-to-head with Gralise vs. Horizant. And this brings us to our second issue, coverage.
Depomed will have an approved label for PHN. They may even eventually get marketing exclusivity for seven years if they can finalize the orphan drug designation with the U.S. FDA. But the label for PHN is key. The market is already dominated by generic gabapentin. Insurance providers aren’t going to pay for the use of Horizant off-label. There is already significant pushback from payors on Lyrica (pregabalin) with reimbursement step edits. We do not see a provider approving reimbursement for Horizant for PHN, not as long as gabapentin, Lyrica and Gralise are around.
Xenoport has discussed potentially filing a supplemental new drug application (sNDA) for Horizant in PHN later in 2011. I say this is a long-shot. This would have to come after approval in RLS, and the phase 3 trial has yet to begin.
But let’s say I’m wrong on the market and the label. Let’s say that, somehow, a pain doc decides that Horizant is the way to go over generic gabapentin, Lyrica, and Gralise, and that the insurance company agrees to pay for whatever prescription the doc writes. It comes down to patient preference. XenoPort and its partners have been unable to show Horizant has significant utility in other indications, at least in a randomized well-controled phase 3 program.
In September 2009, XenoPort and Glaxo released top-line data from a phase 2b program showing a statistically significant improvement versus placebo for all doses of XP-512 (now called Horizant for RLS). But the incidence of dizziness was high at 24% and 30% (vs. 15% for the placebo) in the 2400mg/day and 3600mg/day dose, and the incidence of somnolence was equally high at 11% and 14% for the same doses.
Click here for the data from that phase 2b program.
When compared to Gralise, with dizziness and somnolence at 11% and 5%, respectively, we question why any patient or physician would choose Horizant, especially considering Horizant is dosed twice daily, whereas Gralise is dosed once daily. Twice daily Horizant, with a higher incidence of dizziness and somnolence, does not compare well to Gralise, and seems to offer only a slim advantage over generic gabapentin for PHN. Then again, I felt the same about Pfizer somehow posting $3.1 billion in Lyrica sales in 2010.
The use of Horizant outside of RLS will be limited in my opinion. Phase 2 trials with Horizant in diabetic peripheral neuropathy (DPN) and a phase 2 trial migraine headache did not meet statistical significance. The data from both these phase 2 programs can be found here: DPN Data and here with Migrain Data.
At this point, if you are a XenoPort shareholder, I’d be worried more about approval on April 6 than market share. But if you are a Depomed shareholder, I wouldn’t worry either way. And if Depomed’s stock sells off on Horizant’s approval, I’d use that as an entry point into the stock, because Horizant sales in PHN (or hot flash for that matter) will be tiny.
For more information on Depo, check out this excellent article written by Tro Kalayjian here.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.