Incyte’s topical formulation of its JAK inhibitor, INCB18424, doesn’t seem to get much respect from analysts. Even after showing robust activity and safety in a placebo-controlled multi-dose Phase IIb trial in mild to moderate psoriasis patients, most believe it has limited market potential. Management hasn’t given any guidance on revenues for topical 424, but is currently seeking a partner to take the program forward.
The current top selling drugs for psoriasis, as with RA, are anti-TNF biologics. First line treatments include methotrexate, cyclosporin, and steroidal creams. None of these drugs have been entirely satisfactory for psoriasis patients. Creams are the most convenient, but are less effective than injectables; overuse may lead to thinning of the skin. All the rest require injections, are immunosuppressive and may lead to an increased risk of infections. Methotrexate and cyclosporin may also cause organ damage.
Of this selection, anti-TNF drugs appear to have the greatest efficacy, but are also by far the most expensive, priced at over $10,000/yr. Few patients can afford such drugs for a disease some health care organizations deem to be more of a cosmetic than medical issue. As a doctor in a January 24, 2007 New York Times article said, “Have drug, need patients.”
Approximately 2-3% of the population suffer from psoriasis, the most common autoimmune disease in the world. While greater then 90% of patients have mild to moderate disease and are typically treated with topical creams, a significant number of patients with severe disease are treated with anti-TNF therapies. Sales of creams in 2008 were approximately $850 million- in contrast, sales of the far more expensive biologics were close to $2.5 billion.
Okay, so topical 424 will have no chance of being priced close to $10,000/yr. What it has going for it are advantages over current topical medicines. At least in an exploratory study, it has been shown to be as effective as currently available creams, does this without any thinning of the skin and with the convenience of once daily application.
Dermatologists are also more comfortable prescribing creams over other treatment options. In their target group of psoriasis patients, many who are unsatisfied with their current treatment options, topical 424 certainly has the potential for significant usage.
But what really excites me, is that topical 424 appears to be the perfect candidate for a dual-status Rx and OTC drug. In the 300 patient Phase IIb trial, it has been shown to be quite safe, and I believe a Phase III will confirm this. Incyte has already tested three doses: 0.5, 1, and 1.5 %, all of which met their primary endpoints. This means a lower dose can be offered for OTC while the higher dose will remain a prescription. OTC sales may cannibalize some prescription sales, but studies have shown that taken together, having both channels leads to increased combined sales.
J&J would make a nice partner. It has recently gained experience calling on dermatologists with its launch of Stelera for moderate to severe psoriasis, and of course, it has its vaunted OTC division. Whoever the partner ends up being, I hope they maximize the value of this product.
Disclosure: Long INCY