That’s what Regeneron (REGN) and partner Sanofi (SNY) paid for a FDA Priority Review Voucher (PRV) last year that will shorten the review time for its new cholesterol drug, the PCSK9 inhibitor alirocumab, to 6 months instead of 10. This puts the expected approval of alirocumab (to be marketed as Praluent) one month ahead of rival Amgen’s (AMGN) evolocumab.
The FDA’s Priority Review Voucher program has been somewhat overlooked since its inception in 2007, but this should begin to change as drug developers (and investors) note its impact on emerging therapeutics. The PCSK9 class is the program’s first real-world test in the market.
Early Monday morning, Regeneron announced that the FDA has accepted for priority review the Biologics License Application (BLA) for alirocumab. A priority review reduces the FDA’s standard 10-month review time to 6 months. The FDA set a target action date of July 24, 2015 for alirocumab.
Amgen, meanwhile, submitted its own New Drug Application in August of 2014. Two months later, the NDA was accepted for standard review, and the FDA set a target action date of August 27, 2015. Assuming the drugs are approved, Regeneron/Sanofi will have a little more than 30 days of lead-time on Amgen.
Both drugs are monoclonal antibodies targeting PCSK9 (proprotein convertase subtilisin/kexin type 9) and are intended for the treatment of hypercholesterolemia. As new treatments for high cholesterol, the injectable drugs are expected to bring in a combined $10 billion at peak for their developers, which also includes Pfizer Inc. (PFE).
Regeneron jumped ahead of the competition with the strategic use of its Priority Review Voucher, a relatively new program at the FDA that rewards drug developers who go after small or overlooked disease indications like rare pediatric indications or tropical diseases. The transferable voucher – which is awarded at the time a drug is approved in one of these two neglected areas – allows the holder to ask the FDA for priority review of another drug application that would otherwise get a standard review. The PRV does not have to be applied to a rare indication.
Priorityreviewvoucher.org explains the program and tracks existing vouchers, of which four have been issued and two used since 2007. The program is based on a 2006 paper from Professors at Duke University (Ridley et al. 2006) and was signed into law late in 2007.
Regeneron and Sanofi bought the voucher from BMRN in July of last year for $67.5 million. (Worth noting, the paper’s authors see the PRV’s value at closer to $300 million). BioMarin received the voucher when the FDA approved Vimizim, the company’s treatment for Morquio A syndrome, in February 2014.The Vimizim voucher was not the first PRV issued under the program (it was the first rare pediatric voucher) – but it was the first to be re-sold.
It remains to be seen whether Regeneron’s extra month is worth $70 million, but our suspicion is “yes” given REGN/SNY’s first-mover advantage. 30 extra days in front of physicians who are just getting familiar with this new class of drugs will go a long way in the market.
This past November Gilead Sciences (GILD) made headlines when it purchased a PRV from Knight Therapeutics for $125 million. Knight obtained the voucher 6 months earlier with the approval of Impavido, a medication for leishmaniasis. Gilead has yet to say where they’ll put the PRV to use.
The PRV program will be particularly interesting in 2015 and 2016 due to a pipeline of new drugs directed at Ebola and similar filoviruses. In 2014, President Barack Obma signed into law the “Adding Ebola to the FDA Priority Review Voucher Program Act”, which adds filoviruses to the list of eligible diseases and allows for multiple transfers of the voucher. The change also reduces the required notification period for the FDA to 90 days (previously, drug developers had to notify the FDA that they planned to use the PRV 365 days in advance of its use). Healthcare investor Emory Redd ran some back-of-the-envelope numbers on the value of a PRV after these changes at his blog, HedgeRoll.
Gilead shelling out $125 million for a PRV has big implications for small drugmakers, who are currently at the fore of developing an Ebola therapeutic. We’ve written about Tekmira Pharmaceuticals’ (TKMR) potential to receive a PRV, but a number of publicly traded drug developers are also in the race. Chimerix (CMRX), GlaxoSmithKline (GSK), NewLink Genetics (NLNK), and BioCryst Pharmaceuticals (BCRX) are all developing therapies or vaccines for Ebola. Poignantly, I met with a small drug company while at the JP Morgan Healthcare Conference two weeks ago that may also have a shot at a rare pediatric PRV. Fennec Pharmaceuticals (FENCF) is developing sodium thiosulfate as a protectant against ototoxicity associated with platinum-based chemotherapies in pediatric cancers. STS has its hurdles, but for the $30 million Fennec a PRV valued at $125 million has serious implications.
Our view is that the PRV program will increasingly become a strategic component of pharmacuetical life cycle management. And, it may have big implications for small drug developers now that larger pharmaceutical companies are putting a dollar value on the vouchers – Regeneron/Sanofi at $67.5 million and Gilead at $125 million. It will be interesting to see how REGN/SNY’s one-month lead on AGMN plays out in the PCSK9 market.
One or more of PropThink’s contributors are long REGN, GILD, TKMR, BCRX, or FENCF.
