Pharma’s Cutting Edge

As regular readers will no doubt notice, I’ve changed everything at Pharma’s Cutting Edge, from the layout, to the blogging tool (from Blogger to WordPress), to the feeds (I’ll try to get Feedburner’s feed on the site again soon).  It’s like I’m starting out all over again, and man does it feel good.  We have categories now!  I’ll also be able to reach a larger fraction of the interested audience with better tools for search engine optimization, tracking, and feeds.  So, that means more exposure for me and more exposure for you when you provide your thoughtful comments on my posts.  I’ll also be regularly featuring guest bloggers on the site, so expect more content variety as well.  I look forward to hearing from you soon.

Best,

Fred Cohen (fred@pharmagrowth.com)

Nothing particularly revelatory in this post–just a couple quick reminders if you will. I don’t follow Corcept, and I hadn’t heard of Corlux until I’d read this press release. On the other hand, I have heard of (and prescribed) the active ingredient in Corlux, mifepristone (aka RU-486). Most people are familiar with this drug as an abortifacient, but clinical endocrinologists know it primarily as a treatment for Cushing Syndrome (i.e. cortisol excess syndrome). Mifepristone is an antagonist of glucocorticoid receptors and the structurally progesterone receptor (thus its abortifiacient utility). In any case, Corcept apparently has some methods of use patent(s) protecting use of the drug in certain types of depression and other conditions. The Phase 3 program is for psychotic major depression, and they have three studies underway. They reported on one study Friday, which was negative (i.e. placebo and Corlux apparently equally and rather dramatically efficacious) and which sent the stock to an all-time low (market cap just $35M), dropping 56% on the day.

So, just another startup specialty pharma fizzing out. No surpirses there…right? Well, not exactly. You see, without knowing the specifics of the Phase 3 studies (which have not been made public) there is no way to determine with reliability whether Corcept and its first product are going to make it to market. What we do know is that the Phase 3 studies are similarly designed and are also similar in design to the successful Phase 2 study. Psychiatry is the “squirreliest” of therapeutic areas. Many of the drugs that are now mainstays of treatment for depression and anxiety, reaping their manufacturers billions of dollars a year, had a failed study in Phase 3 that looked not altogether disimilar from the failed study Corcept just reported. Sure, it’s not looking so great for Corcept at this point and the market is reflecting that reality, but I think that the market might be overreacting a bit too. Part of the lack of confidence might be wariness of the management team. The CEO, a former academic and founder of the company, doesn’t exactly instill confidence to investors that he knows what he’s doing (check out the conf call by going to the Corcept homepage and see if you agree). But if you’re thinking of taking a shot at this one, look beyond the novice CEO and you’ll see some pretty impressive scientific minds on the ad. board, and this is a company whose success to the market depends almost solely on good science.

This is the press release from Merck describing the MEDAL study results. You’ll recall that MEDAL is the prospective, comparative trial of Arcoxia (a COX-2 inhibitor) and diclofenac (an NSAID) with the primary outcome of cardiovascular events. Before the results were release, the study design had been criticized on a couple of key grounds. In particular, Curt Furberg, an outspoken, influential critic of Merck’s handling of Vioxx, writing in the August issue of the American Heart Journal, was critical of the use of diclofenac as the comparator. Now that the unpublished results of MEDAL apparently demonstrate no difference in cardiovascular outcomes with the two drugs, Furberg’s criticism will become the real challenge for Merck. In an interview published in today’s WSJ, Furberg was quoted as saying that: “Most people didn’t expect a difference” …. The take-home message is stay away from diclofenac. The Cox-2 drugs have harmful effects and this study documented that diclofenac is no safer.” Probably not the reaction Merck was hoping for.

But surely Merck knew that diclofenac would be criticized as a comparator when it designed the MEDAL study. So, why didn’t Merck choose Naproxen as the comparator? I suspect we’ll know the answer to this question in short order. In the meantime, what should Merck do to proactively address this crucial criticism? There’s a few things they can do, none of which will be definitive. First, they need to scour the published literature on diclofenac (I’m assuming they already have) and provide support for an independent case-control study or two of diclofenac using data from prescription-event monitoring databases. Both of the efforts have the goal of establishing the relative safety of diclofenac in the “real-world” setting. Merck should also explore preclinical experimentation to determine how/if diclofenac differentiates itself from Vioxx with regards to proposed mechanisms of increased thrombotic risk. Finally, it will be useful for Merck to compare the rates of cardiovascular events in MEDAL with those from a body of recent cardiovascular outcomes studies, using primary data when possible. In particular, it will be important to match MEDAL subjects taking diclofenac with subjects from contemporaneous studies on key factors that would be likely to influence absolute event rates (e.g. age, geographical region, smoking status, concomitant meds, etc.). If MEDAL event rates appear to be the same as those from other studies in which subjects didn’t use diclofenac, it will be harder to argue that diclofenac itself is dangerous.

I’m not sure I’ve commented on this issue previously, so I thought now would be a good time, as legislation has now been proposed, and presumably there will be some debate in Congress.

The issue of bringing US inventorship criteria more in line with the rest of the world has been around for some time. In most of the world, inventorship is determined in part by first-to-file status. In the US, by contrast, inventors do not have to be first to file a patent application, but they must be first to conceive of the invention and they must be diligent in reducing the invention to practice. Practically speaking, the US system places a substantial burden on inventors to document their inventions (i.e. the ideas) and their reduction to practice (i.e. activities and observations supporting the ideas) prior to filing an application. This burden is shared by anyone that desires US patent protection, which is to say nearly everyone in our industry, because the US is the largest single market for drugs and devices. If you work in drug discovery you know this burden first-hand all too well. Switching to a first-to-file system would not eliminate the need to document experimental details and new ideas, but it would reduce the burden on scientists by eliminating some administrative tasks that serve only to meet current US patent requirements (e.g. the need to have lab notebooks signed on a regular basis).

The article suggests that the pharmaceutical industry is against this change to the US system, but it doesn’t explain why. At first blush, it seems that everyone would be well served by a European-like inventorship determination, because it would reduce work that doesn’t contribute directly to innovation (i.e. it would boost innovation productivity). But remember that patent life is a fixed period that begins with filing of the final patent application. Effective patent life (i.e. actual time for patent protection of a marketed product) is determined by the date of patent filing, the time between filing and product launch, and the time of generic entry into the market. As we all know, there is a relatively long time between initial discovery of a potential therapeutic and its realization as a product, often a decade or more. Under the U.S. patent system, companies are now able to maximize effective patent life by waiting to file their first patent applications, while protecting themselves by documenting the inventions and their reduction to practice internally.

In a first-to-file system this type of strategic patent filing isn’t possible. Companies practically cannot wait to file in a first-to-file system, since the filing itself represents the only acceptable way to assert inventor status. All else being equal, the result is that effective patent life for drugs in the US would be reduced relative to the current system. Exactly how much it would be reduced in an individual firm can be estimated by using internal data. Calculate the time interval between the dates of first filings for successfully marketed products and the dates the inventions were first documented in the lab (in the lab notebook). This interval is the maximum reduction in effective patent life that would be expected from a change in inventorship criteria. Actual effective patent life reduction would be less than this, and may be estimated subtrating the amount equal to administrative tasks (i.e. preparation of the filing) plus the time interval between the idea and the filing filing (approximated as the time between the provisional and final patent applications). The calculation looks like this: Effective Patent Life Reduction = (Date of actual first final patent filing-Date invention first conceived)-(Time to prepare patent applications+(Date of final patent application-Date of provisional patent application)).

The life science industry won’t be alone in opposing this legislation, but they will be in the minority. Few industries use patents to appropriate their inventions as much as the innovative life science industry, and fewer still have the long development times “enjoyed” by the drug industry. In particular, industries such as software and consumer electronics strongly favor the first-to-file criterion. Look for spirited debate in Congress–assuming legislation reaches the point of debate–fueled by intensive lobbying activity behind the scenes.

I haven’t yet read the appraisals of these two drugs by NICE. I’ve just read the reactions to the decisions of NICE to recommend that NHS not reimburse for either drug in colon cancer based on cost-effectiveness arguments. If this article is accurate the bases for the decisions were the lack of ICE (incremental cost-effectiveness) data based on head to head studies against exisiting (read chaper) therapies. The reason for this note is simply to point you to the blog entry I posted on the main page in May describing NICE’s preliminary appraisal of Exubera, which was given a similar decision. Pharmaceutical innovators are in a difficult position from a development risk:reward perspective when it comes to NICE and other agencies that use strict ICE criteria for reimbursement decisions. Until/unless U.S. and other key EU purchasers adopt these strict criteria, the risk:reward balance will continue to favor conservative development testing for ICE, meaning avoidance of head to head studies against cheap existing therapies whenever possible. More on this later.