Merck KGaA Leaves Multiple Sclerosis Field Wide Open for Novartis

| About: Novartis AG (NVS)

Multiple sclerosis therapy has been changing a lot in recent years, and one of the biggest events was the introduction of Gilenya (fingolimod). That's the first non-injectable for MS, and it's quite a story (as well as being quite a weird compound from a chemistry perspective).

Novartis (NYSE:NVS) has been racing ahead in selling that one, because they knew the Merck KGaA (Merck-Darmstadt) had another oral compound in the works, cladribine. That's a nucleoside analog with a different mechanism (targeting some lymphoctye subtypes and thus changing immune response), and it was already used in the treatment of some forms of leukemia. It did show promising results in the clinic for relapsing MS, and there were high hopes.

Not now. Word has come from the company that they're withdrawing their application in Europe and the US, and taking the drug off the market in the only two countries (Russia and Australia) where it had been approved. The FDA had already said that it would not approve cladribine without more safety information, and Merck KgGa has decided that (1) the ongoing trials won't do the job, and (2) it's not worth it (risk/reward) to try new ones.

So that leaves the field open for Novartis, and German Merck (who have had several disappointments in recent years) in some trouble..