Delays by FDA, Battle With Ortho Put Amgen’s Drug EPO to the Test
Jeanne Marcus remembers lying in a hospital bed in August, 1987, when she was stricken with kidney failure. Her life was changing and it wasn’t going to be easy.
She would need kidney dialysis treatments three times a week for the rest of her life. She would need regular blood transfusions because her kidneys don’t produce enough red blood cells, which leave her chronically anemic. Doing a day’s worth of errands would become a major accomplishment.
But Marcus has taken strength from something her doctor told her then about a promising drug called erythropoietin, or EPO, that was being tested by Amgen, a Thousand Oaks biotechnology company.
“My doctor said when EPO comes out it will be a tremendous step for you,” Marcus recalled. The doctor said she could expect to regain much of her old energy and resume a more or less normal life.
Her regular doctor promised her EPO treatments as soon as the drug was approved for sale by the Food and Drug Administration. Marcus expected the drug to be for sale last month, but she’s still waiting. “This delay has been a hardship,” she said.
In many ways the story of EPO is reflective of the great potential and the great frustrations facing biotechnology firms. In biotechnology, scientists are medical detectives who by resplicing genes, which carry the blueprints of life, can trigger production of rare hormones and proteins so they can be used as therapeutic drugs.
But getting a biotechnology drug approved by the FDA is an exhausting process; Amgen has already submitted more than 40,000 pages of documents. And the fact that EPO figures to become a best-selling drug appears to have triggered a nasty legal dispute that has slowed the delivery of EPO to patients who dearly need it.
May Delay Approval
Two weeks ago, a federal judge ordered Amgen to amend its complicated EPO application with the FDA and, as a result, there will be a delay before the drug is approved for sale. No one, not the FDA, Amgen’s executives, the stock market and certainly not Marcus, knows how long that delay will be.
“It could affect the approval time, it may not,” FDA spokeswoman Faye Peterson said.
“The best case is weeks,” Amgen Chief Executive Gordon Binder said. “The worst case is many, many months.”
Any delay is too long for Marcus. “Medically, there is absolutely no reason for the drug not to be approved. This delay is just a matter of money,” said Marcus, 63, a Granada Hills resident.
In many respects she is right.
The court order came about after Ortho Pharmaceutical Corp., a division of Johnson & Johnson, filed suit against Amgen claiming it broke their 1985 EPO marketing deal.
According to that contract, Amgen owns the rights to sell EPO to kidney dialysis patients, Ortho owns the rights to sell EPO for any other use. But Ortho claimed that Amgen never kept its promise to file Ortho’s clinical data with the FDA. As a result, Amgen alone was about to get FDA approval to sell EPO.
Ortho worried that doctors would start prescribing Amgen’s EPO for other than kidney dialysis patients and it would lose sales. Ortho wants the FDA to approve the drug’s sale simultaneously.
Why so much squabbling? EPO looks like a promising anti-anemia drug that can help more than just kidney dialysis patients and may prove beneficial to those undergoing chemotherapy or suffering from liver disease.
Guarding Interests
Indeed, within a few years the annual domestic market for EPO will be $450 million a year; $200 million of that coming from sales to the 25,000 kidney dialysis patients who need frequent blood transfusions, according to Denise Gilbert, a biotechnology analyst with Montgomery Securities. Other analysts peg the annual domestic EPO market as high as $2 billion.
With so much money to be made, Amgen and Ortho are trying to protect their interests. Amgen wants the drug out as soon as possible, while Ortho wants the FDA to hold up approval until the drug can be made available to a wider group of patients.
Now that Amgen has followed the court order and filed thousands of pages of Ortho data with the FDA, it is up to the government to decide whether to quickly approve Amgen’s EPO application as planned, or to start the review procedure anew as it considers Amgen and Ortho’s request in tandem.
Jim McCamant, editor of Medical Technology Stock Letter, said there is a 50% chance the FDA will go the slow route and hold up approval of EPO for another six months.
All of which dismays the medical community. “The medical side of EPO is so beautiful and has been easily the most rewarding drug I’ve worked with. But the commercialization process is so difficult and complex,” said Joseph Sobota, executive vice president of Chugai-Upjohn Inc., an Amgen rival that has submitted its own EPO application to the FDA. Even with the recent court delays, analysts expect Amgen to win approval to sell EPO well before Chugai-Upjohn.
One of the reasons for the excitement is that EPO occurs naturally only in tiny amounts in the body, and until biotechnology came along, it was impossible to get hold of enough EPO to use as a therapeutic drug. EPO is a hormone that is found in the kidneys and triggers production of red blood cells that carry oxygen throughout the body. Patients suffering from kidney disease don’t have enough red blood cells, and so need blood transfusions.
Has Other Uses
But in clinical tests, patients given EPO regained much of their lost energy and no longer needed the blood transfusions. They still need kidney dialysis, but their life is immeasurably improved. The drug has begun to go on sale in several countries in Europe.
EPO also appears be a versatile drug. It is now being tested with AIDS patients who receive AZT, a drug that seems to inhibit the HIV virus but also has serious side effects.
But no one is more interested in the potential of the drug than would-be EPO patients, such as Jeanne Marcus. She became a student of EPO and learned as much as she could. She heard about patients in Amgen’s clinical tests who were able to exercise again, and others who went back to riding bicycles.
For Marcus, having enough energy to ride a bike is a dream, and the EPO stories, she said, got her “very excited.” But the latest court-triggered delay has left her and her fellow patients “very discouraged.”
In his 17-page decision, U.S. District Judge Joseph J. Farnan leveled most of his blame at Amgen for violating the 1985 marketing agreement. Among other things, the arrangement called for Amgen to manufacture EPO and sell it at a wholesale price to Ortho, which would then sell it under its own label. But Judge Farnan said Amgen did not file Ortho’s records with the FDA in part because it couldn’t reach an agreement on what price Ortho would pay for EPO and that “Amgen had unrealistic ideas about the price it would charge.”
Analyst Gilbert said of the two companies: “It’s like two little kids fighting. Each saying, ‘It’s not me who started it.’ ”
Still, Gilbert noted that with 25,000 kidney dialysis patients who need EPO now, it’s “extremely unlikely” that the FDA will delay approval for longer than a few weeks.
But the delay has already stung Amgen’s finances. The tiny company doesn’t have any other drug on the market and it anticipated being able to sell EPO in March, so it spent heavily to hire salespeople and to build up its production line.
With no drug to sell, however, Binder said Amgen will lose from $8 million to $10 million for the year that ended March 31.
Amgen’s stock, meanwhile, closed Monday at $42 a share, down from $44.25 before the court order two weeks ago.
Some analysts find it odd that Amgen has not reached a settlement with Johnson & Johnson over the domestic sale of the drug, particularly because another J&J; group and Amgen have a European marketing arrangement for EPO that is working well. “Amgen’s inability to work well with somebody else, it’s almost like arrogance or impatience” said McCamant of the American lawsuit.
Binder says he remains convinced that Amgen is “going to be able to sell EPO to dialysis patients.” But exactly when that happens is something else. “There are other things I’d like to bet on better than this,” Binder said.
