A Food and Drug Administration panel dealt a sharp blow to biotech giant Genentech Inc. on Wednesday by refusing to recommend approval for the company’s high-profile drug Avastin as a treatment for breast cancer.
The news signaled to industry experts that federal regulators appear to be adopting stricter standards for drug approvals. It also sent the company’s shares into free fall -- down more than 8% before trading was stopped in the afternoon.
Avastin is one of the highest profile of a new generation of cancer therapies that work like Trojan horses, slipping inside cancer cells and attacking them without killing lots of nearby healthy cells. It has been taken by more than 200,000 patients since coming on the market in 2004 as an approved treatment for colon cancer. Two years later it was approved for lung cancer.
Genentech had hoped to expand Avastin’s use among the estimated 215,000 women diagnosed with breast cancer each year, a market analysts estimate could reap $1 billion or more in additional sales.
The cancer drugs are controversial: They extend patients’ lives in some cases only by several months, and they can cost as much as $100,000 per patient per year.
In recent years, federal regulators have been willing to approve drugs even if the benefits were only marginal. But that may be changing.
As recently as a few years ago, it was enough for a cancer drug to slow the progression of the disease, regardless of whether it extended patients’ lives.
The FDA has taken a harsher view of other biotech top sellers, Aranesp and Epogen, made by Thousand Oaks-based Amgen Inc.
Earlier this year, the agency slapped a black-box warning on the drugs, its most severe, after research showed the anemia drugs used by more than a million people last year might increase the risk of death in some patients. The move led to a vast drop in the drugs’ sales, and Amgen announced large layoffs last summer.
Swiss drug maker Roche Holdings Inc., which owns the majority share of Genentech, received approval to market Avastin to breast cancer patients in Europe based on the same data the FDA considered in its rejection Wednesday.
“Regulators are obviously responding to pressure to make sure drugs are both highly safe and effective,” said Dr. John Glaspy, director of the Outpatient Oncology Center at UCLA’s Jonsson Cancer Center. “There is a real sea change going on.”
Wednesday’s 5-4 vote on Avastin came at a meeting of an FDA advisory committee made up of outside doctors, scientists and others. The agency does not have to follow the panel’s recommendation but typically does.
Before the vote, the panel reviewed a key study showing that the drug when used along with chemotherapy delayed the time before tumors grew but didn’t increase patients’ life span.
The panel decided that the results were insufficient to warrant approval of the drug given it also had been shown to cause a small number of heart attacks, blood clots and deaths.
South San Francisco-based Genentech said it hoped to persuade the FDA to approve the drug for breast cancer early next year, although such approvals are rare if they fail to obtain the backing of an FDA advisory panel.
“We appreciate the consideration that FDA panel made but are disappointed with their decision,” said Genentech spokesman Edward Lang. “We hope to work with the agency in the coming weeks.”
UCLA’s Glaspy said Wednesday’s surprise decision would have an immediate effect on patients.
Many doctors have been prescribing Avastin to breast cancer patients off label, or for unapproved uses, and some insurers have been reimbursing for the drugs.
The FDA panel’s decision means doctors probably will back off from prescribing the drugs until further research is done, Glaspy said.
The vote was a rare dose of bad news for Genentech, which up until now has appeared immune to the growing ills facing the broader drug industry, as well as its chief biotech rival Amgen.
“There is no other way to say it: This was a surprise,” said Christopher Raymond, a biotech analyst for broker Robert W. Baird & Co. “Regulators are starting to tightening the screws a bit.”
Shares of Genentech fell $6.14, or 8.4%, to $66.64 before trading in the stock was halted for the day. The stock is down from a peak of $80 in September.