Ironwood Eyes Large Market For Linaclotide, Will Tread Carefully On Price
Executive Summary
Ironwood Pharmaceuticals Inc. is confident about the large market potential for its constipation drug linaclotide, but as the market now is dominated by over-the-counter laxatives, it knows it has to be "smart" when it comes to price in order to win over payers.
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Ironwood Pharmaceuticals Inc. is confident about the large market potential for its constipation drug linaclotide, but as the market now is dominated by over-the-counter laxatives, it knows it has to be "smart" when it comes to price in order to win over payers. Partnered 50/50 with Forest Laboratories in the U.S. and out-licensed to Almirall S.A. in Europe, linaclotide is a once-daily agonist of guanylate cyclase type-C (GC-C), a receptor found on the lining of the intestine. It is thought that activation of GC-C inhibits nerve firing, reduces abdominal pain and accelerates intestinal transit, according to the company website. And importantly, unlike Novartis’ centrally acting 5-HT4 antagonist Zelnorm, a popular therapy for constipation-predominant irritable bowel syndrome that was pulled from the market in 2007 over cardiovascular safety concerns, linaclotide acts locally on the intestinal wall with minimal absorption into the bloodstream at doses tested in trials. Today the constipation market is largely served by over-the-counter laxatives. The market potential for a safe, efficacious branded drug that can steal away laxative share is about $6 billion, according to company estimates. This projection assumes a price somewhere between $5.50 and $8.50 a day, per company guidance. At the Digestive Disease Week meeting held from May 7-10 in Chicago, Ironwood released full positive results for two Phase III trials in irritable bowel syndrome with constipation-predominant symptoms – the 26-week MCP-103-302 and the 12-week LIN-MD-31 studies. In these trials, linaclotide met all primary and secondary endpoints, demonstrating the ability to reduce pain as well as increase the number of complete spontaneous bowel movements. And the data suggest clinical response within one to three days, with effects lasting throughout for the duration of research, Ironwood reported. Linaclotide also proved to have a good safety and tolerability profile, with diarrhea being the most commonly reported side effect. The formal presentation at the DDW meeting followed the release of top-line results from the IBS-C trials in fall/winter 2010 (Also see "Strong Phase III Data Have Linaclotide On Track For Filing In 2011" - Pink Sheet, 20 Sep, 2010.). The Phase III program also includes two previously released pivotal trials in chronic constipation. During a May 12 investor briefing, Ironwood executives said they were on track to file one NDA for the two indications in the U.S. in the third quarter of 2011 with a European submission in IBS-C set for the second half of the year.
Market In Waiting About 15 million patients with IBS-C and chronic constipation actively seek treatment from their doctors, and of these some 10 million are dissatisfied with the results of therapy. The plan for linaclotide is to target these 10 million. Currently, doctors advise patients to take laxatives – either branded or OTC – which may work to increase bowel movements, but many patients still suffer from abdominal pain and bloating and typically do not want to take them on a regular basis, explained Ironwood Chief Commercial Officer Thomas McCourt. The vast majority of gastroenterologists and primary care doctors say that laxatives are not very effective or are only somewhat effective, the company reports. Some analysts are reporting that, following the DDW presentations, the Phase III data have been well-received by doctors. “The feedback has been consistently positive, with physicians particularly impressed with the rapid/sustained efficacy and clean safety profile of the agent,” wrote J.P. Morgan’s Geoff Meacham in a May 12 note. Getting Payers On Board But during the May 12 investor call, Ironwood execs addressed one question mark in linaclotide’s future: payer acceptance. In a May 10 note, Credit Suisse analyst Catherine Arnold observed that it’s not a matter of if linaclotide will become a blockbuster but when, and that it could take time to win widespread payer acceptance. During the call, execs indicated that if they are smart about their pricing, payers will be more likely to reimburse the drug. In a follow-up interview, McCourt elaborated that in blinded market research, payers responded favorably to the drug’s profile, but also indicated that the overall value proposition needs to be strong to justify coverage. He said Ironwood wants to ensure good access with payers and will be working closely with its partner Forest to determine the right price. “The last thing we want is a highly restricted product,” McCourt said. “The initial reaction is favorable. But it’s really going to come down to price as far as what kind of access we can get.” Prior to joining Ironwood, McCourt directed the launch of Zelnorm at Novartis and was brand manager for the proton pump inhibitor Prilosec (omeprazole) at AstraZeneca. One guide is the price of other branded GI drugs. Prescription proton pump inhibitors cost from $5.00 to $5.70 per day. Sucampo Pharmaceuticals Amitiza (lubiprostone) – cleared for chronic constipation and IBS-C– has a WAC unit price of $3.66, according to GoldStandard's ProspectRx pricing database (an Elsevier company), which, considering twice-daily dosing, amounts to more than $7 a day. When Zelnorm was on the market, it had a WAC unit price of about $5.90 a day and had good placement on formularies, McCourt pointed out. Ironwood hasn’t determined its price yet, but believes there is some flexibility above the $6 mark but below $9.50. The firm's blinded market research indicated that payers would balk at such a price. Learning From Zelnorm The rise and fall of Novartis’ Zelnorm provides positive and negative examples for developers of drugs for constipation. Zelnorm was approved for short-term treatment of women with IBS-C in 2002 and then cleared in 2004 for chronic constipation. It went on to become a market leader in the space, with $566 million in worldwide sales in 2006, including $488 million in the U.S. – illustrating the market potential in constipation. But after cardiovascular safety effects emerged, the drug was suspended in early 2007 (Also see "Door Open For Zelnorm Return Despite Marketing “Suspension,” Novartis Says" - Pink Sheet, 2 Apr, 2007.). Ironwood estimates that in terms of 30-day packages of product, its target market in the U.S. currently consumes 23 million over-the-counter units and 7 million prescription drug units per year. Experience with Zelnorm also indicates that drugs targeting this non-life-threatening disease must be very safe. The fact that there is minimal absorption of the drug in the bloodstream hopefully will minimize risk to the patient, McCourt said. Diarrhea Not A Deal-breaker Data released to date do not reveal any unusual safety issues, and the most prominent one – diarrhea – is to be expected and most likely manageable. In the 12-week IBS-C study of 800 patients reported at DDW, there were 210 reports of adverse events in the placebo arm (53%), including 14 cases of diarrhea (3.5%). That compares to 228 adverse events for patients on linaclotide (56.2%), including 79 with diarrhea (19.5%). Other adverse events reported to a lesser degree in the study were abdominal pain, headache and flatulence. In the placebo arm, 11 patients (2.8%) dropped out due to adverse events, compared to 32 (7.9%) in the linaclotide arm. Of these, drop-out rates related to diarrhea were 1 (0.3%) for the placebo group and 23 (5.7%) for linaclotide. In the 26-week IBS-C study of about 800 patients, the adverse event rates were 228 (57%) for placebo versus 263 for linaclotide (65%). Rates of diarrhea in this trial were 10 (2%) compared to 79 (20%) for the test drug. Dropout rates overall were 10 (2%) for placebo, including 1 (0.2%) due to diarrhea, and 41 (10%) for linaclotide, including 18 (4%) due to diarrhea. Other side effects reported in this study included nausea, abdominal pain, flatulence and headache. The most notable side effect of diarrhea would be expected given the drug’s mechanism of action, wrote Credit Suisse’s Arnold. “The thought leaders we spoke to are not concerned, however, given that only about 4-6% of patients discontinued the studies due to diarrhea and in the real world, doctors will be able to reduce the dose of the drug (giving it only once every 2 or 3 days for example) to help manage this side effect,” Arnold concluded. By Emily Hayes |