Amgen 3Q17 – PCSK9 inhibitor Repatha sales >double YOY to $89 million; FDA decision on CV label update expected by December 2; Commentary on ODYSSEY Outcomes for Sanofi/Regeneron’s Praluent – November 6, 2017

Amgen recently provided its 3Q17 update in a call led by CEO Mr. Bob Bradway. Revenue from PCSK9 inhibitor Repatha (evolocumab) more than doubled year-over-year (YOY) to $89 million from a base of $40 million in 3Q16. Sequentially, sales grew 7% from $83 million in 2Q17. This is low sequential growth for a product so early in its launch cycle, and we suspect this modest financial performance is largely driven by poor reimbursement and access – to this end, Repatha experienced a 16% sequential decline in 1Q17. We hope and expect that an update of Repatha’s label to reflect the positive FOURIER CVOT results can change this narrative – more on this below. As has been the case since Repatha’s launch in 1Q16, a majority of the product’s revenue (59%) and share of revenue growth (63%) came from the US market. By geography, US sales totaled $62 million (doubling YOY from $31 million in 3Q16) and ex-US sales totaled $27 million (tripling YOY from a lower base of $9 million in 3Q16). Management expressed confidence that Repatha will become a “significant product” for the company’s long-term growth prospects, highlighting the continued upward trajectory in new-to-brand prescription (NBRx) share, which currently stands at 74% (steadily climbing from 70% in 2Q17, 64% in 1Q17, and 56% in 4Q16). Likewise, Repatha holds a majority of total prescription (TRx) share for the PCSK9 inhibitor market in both the US (60%, up from 58% in 2Q17) and the EU (57%), the remaining prescription volume going to Sanofi/Regeneron’s Praluent (alirocumab). For context, Praluent posted $49 million in 3Q17, up 20% YOY. This puts pooled sales for the PCSK9 class at $138 million (up 59% YOY from a base of $49 million in 3Q16 and up less than 10% sequentially), and it puts Amgen’s share of the market by value at 64% (vs. Sanofi’s 36%). Sanofi management mentioned on the company’s recent earnings call that Praluent’s sales trajectory is trending below expectations for such a new product, and we’d say the same is true for Repatha and for the class.

Notably, the US Court of Appeals has ordered a new trial in Amgen’s patent infringement lawsuit against Sanofi/Regeneron, which means Praluent will remain on the market for the time being. We do see profound benefits in a two-product PCSK9 inhibitor class, and we hope these manufacturers can work collaboratively to improve payer coverage of their highly-effective therapies – so many patients need this!

• An FDA decision on Amgen’s Supplemental Biologics License Application (sBLA) for the inclusion of positive FOURIER data on the Repatha label is expected by December 2. The sBLA was granted FDA priority review in July, shortly after its June 2017 submission. Management expressed high confidence that the label update will be approved, suggesting that the company will begin promoting Repatha’s cardioprotective effects to both patients and HCPs “in a matter of weeks” following approval. We’re eager to see what rollout of the new label will entail, and to see how it affects prescription habits. Most importantly, our fingers are crossed that it will improve Repatha’s value proposition from the payer perspective.
  
  • To be sure, access remains a major hurdle for this pricey product, and Amgen reiterated that negotiation with payers to improve Repatha reimbursement remains a “top priority.” Additional leverage in these discussions could come from the recent 2017 update to the ACC Expert Consensus Decision Pathway document, which encourages the use of PCSK9 inhibitors and highlights the FOURIER results. Management explained in Amgen’s 2Q17 update that this revision could signal equally favorable positioning for Repatha in the ACC’s 2018 hyperlipidemia treatment guidelines (the “grand-daddy of guidelines” in terms of their relative influence among cardiologists). We are cautiously optimistic that this combination of strong standing among CV professional societies and a label update reflecting Repatha’s cardioprotective effects could be influential in improving reimbursement. That said, there is a long road ahead to getting Repatha and Praluent into the hands of patients who could most benefit. With a prior authorization denial rate of 96%, as found in a National Lipid Association survey presented at ACC 2017, reimbursement status is the defining barrier slowing uptake for this class.
  • During Q&A, management asserted that the ODYSSEY Outcomes CVOT for Praluent (expected to complete December 2017) will “reinforce the value of the PCSK9 inhibitor class.” We agree that having two positive CVOTs will make an even more compelling case to payers and to guideline-writing committees. See our Sanofi 3Q17 report for more on ODYSSEY Outcomes.
• Management announced positive topline results from a phase 3 study of Repatha on top of maximally-tolerated statin therapy in people with type 2 diabetes (n=424). The study met its co-primary endpoints of mean percent change from baseline LDL and percent change from baseline LDL over 12 weeks. Completed in September 2017, full results for the study are expected at an “upcoming medical meeting.” This adds further validity to results from a pre-specified sub-analysis of people with diabetes within the FOURIER trial recently unveiled at EASD, in which Repatha was associated with an impressive 57% mean reduction in LDL (plunging from a baseline of 89 mg/dl to 31 mg/dl vs. 85 mg/dl with placebo, p<0.0001), 17% risk reduction for the primary composite endpoint (CV death, non-fatal MI, non-fatal stroke, hospitalization for unstable angina, or coronary revascularization, HR=0.83, 95% CI: 0.75-0.93, p<0.0008), and 18% risk reduction for the secondary endpoint of three-point MACE (HR=0.82, 95% CI: 0.72-0.93, p<0.0021). We’re glad to be seeing more applications and clinical investigations of PCSK9 inhibitors in people with diabetes (this recent study from Amgen and the FOURIER sub-analysis also join Sanofi/Regeneron’s ODYSSEY DM program of alirocumab in people with type 1 and type 2). CV risk reduction in diabetes is particularly important because of this population’s elevated baseline risk for CV morbidity and mortality.

Questions and Answers

Q: What your view on the market share for Repatha going forward? You pointed to an NBRx share that is quite high, though your competitor products may remain on the market longer than you originally thought. Furthermore, do you have any comments on how formularies for Repatha are shaping up into 2018?

A: The market share we've achieved to date has been in the presence of a competitor, so I think we will continue to be competitive going forward. Getting more and more patients on Repatha is our objective, and we've been quite successful with that. We are working extensively with payers at the moment in terms of improving the utilization management criteria and working to reduce the onerous bureaucracy that is so frustrating for physicians trying to prescribe Repatha. We look forward to being able to pull some of these things through potentially in 2018.

Q: The ODYSSEY outcomes data for Praluent are expected in early 2018. How would you view things if we get a scenario where the ODYSSEY data looks optically better than the FOURIER data (because of the longer duration trial)? Is this good because it grows the market, or a bad because that's the competitor’s data?

A: Is it good for the science and for the field to have another outcomes result? Sure – after all, the reason there's so much confidence in statins, for example, is because we have a couple dozen outcomes trials that all more or less show the same thing. From a scientific perspective, I think the ODYSSEY trial will reinforce the value of the PCSK9 inhibitor class. In that way, I look forward to seeing the additional data.

A: At ESC, we presented some of the sub-analyses of the FOURIER data. For patients who entered at LDLs below 70 mg/dl and drove levels down to way below this, we actually saw a higher reduction in myocardial infarction and reduction in stroke – up to about a 33% reduction in MI. I can't understand why you wouldn't want to do anything other than drive LDL down as low as you can. Our drug does that, other drugs don't.

-- by Abigail Dove, Payal Marathe, and Kelly Close