Shire Looks to Grab Market Share From Genzyme

Includes: PLX, SHPG, SNY
by: EP Vantage

FDA approval of Shire’s (SHPGY) drug for Gaucher’s disease comes as little surprise given that velaglucerase, now known as Vpriv, was already being administered to patients on an approved treatment protocol basis. That treatment protocol followed the well publicised manufacturing problems with the only other approved Gaucher’s product on the market, Cerezyme, which had interrupted supplies to patients (Event – Shire hoping to take market share with Gaucher drug PDUFA, February 12, 2010).

As expected, the group is intending to agressively take market share from Genzyme (GENZ) and, as such, has come out fighting, pricing its drug at a 15% discount to Cerezyme, and has also set out plans to help cap prices for the drug for co-payers next year to just $500. This is a sensible strategy given that Cerezyme is one of the most expensive drugs in the world and in 2008 racked up sales of over $1 billion, thanks to its average price of $200,000 a year.

However, even with this discounting analysts are still estimating that the Shire drug will only take between 20-25% of market share from Genzyme, given the drug's entrenched status in the market. But even this figure now leaves very little room for Protalix's (NYSEMKT:PLX) Uplyso, which will now be third to market, to capture sales, unless Protalix decides to do much heavier discounting than the 15% that Shire has proffered up to patients and insurers (Protalix's woes continue with Uplyso setback, February 2, 2010).

Doctors will also want to see full clinical data for the drug if only to allay any fears about possible production of antibodies to plant proteins, due to the carrot-cell-based production technique that the group uses in Uplyso, compared with the fully human cell manufacturing process that Shire employs.

Carving out a big niche

So while sales of Vpriv are expected to be respectable at $205m by 2014, according to estimates from EvaluatePharma, what approval of Vpriv does is advance the group's other step to it establishing itself as an even bigger player in the enzyme replacement therapy (ERT) market.

What will further cement the group’s position in the ERT space is gaining approval for Replagal for Fabry disease.

The drug is currently approved for the treatment of Fabry disease in 45 countries, including Europe, and has been available to US patients since December 2009 under an FDA-approved treatment protocol, following Genzyme stopping production of its drug Fabrazyme because of the same manufacturing problems that led to the cessation of Cerezyme manufacture.

But the group’s plans to get the drug onto the market quickly were hampered by being forced to withdraw its BLA in December after the regulator asked for further pharmacokinetic data to ensure comparability between Replagal made in roller bottles and Replagal made in bioreactors. As a result of this request the group withdrew its BLA, but requested fast track designation following a suggestion from the FDA.

The group now has a rolling submission for the drug planned and is expected to submit the pharmacokinetic data requested by the FDA by the middle of this year. As such, it could see approval later this year or early 2011.

Continuing momentum

As well as a clear lack of alternatives to Genzyme’s Fabrazyme, what might give Replagal’s chances of approval a boost is three-year data presented in the middle of February by the Canadian Fabry Disease Initiative, which compared Fabrazyme and Replagal and showed no differences between the two drugs when cardiac and renal function were taken into account.

Another edge that the drug has is that it appears to show a lower antibody response, something that is important with Fabry disease, which like Gauchers is a lysomal storage disorder, interfering with the body’s ability to break down fatty substances. The disorder causes both cardiovascular and renal dysfunction, intense pain and substantially reduces the life expectancy of the 8,000-10,000 patients worldwide, who usually die of renal or heart failure or stroke.

So if Shire pulls of approval of Replagal, shares in the group, which have already risen by 72% over the last 12 months to today’s nine-year high, could climb even higher as investors start to take on board the group’s full potential in these niche indications.