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Sanofi MS drug nears green light after pass-the-parcel marathon

By Ben Hirschler

LONDON (Reuters) - One of the world's longest running drug development sagas may draw to a close this month as French firm Sanofi hopes for a European green light for its new multiple sclerosis medicine Lemtrada.

The drug's quarter-century journey from a laboratory in Cambridge, England, to a possible $1 billion-a-year seller has involved a string of pass-the-parcel deals that serve as an object lesson in complex "drug dealing" between rival companies.

While Sanofi may end up with a new product to plug a hole in its medicine cabinet, the drug's slow evolution is a mixed blessing in the eyes of some doctors worried about pricing.

But for the original scientists behind the antibody treatment, it has been a frustrating wait.

"It's been painful," said Herman Waldmann, emeritus professor of pathology at the University of Oxford, who co-invented the drug while at the University of Cambridge.

"We had to make the running to keep on convincing the pharmaceutical industry at every step that there was something interesting there."

After studying Lemtrada, also known as alemtuzumab, in multiple sclerosis (MS) since the early 1990s, he believes the drug's infrequent infusions have a lot to offer patients.

Sanofi, too, is optimistic about a medicine that would mark its second victory in MS, following last year's U.S. approval of Aubagio, a pill. It expects an EMA verdict by mid-year, implying a decision at the agency's next expert meeting on June 24-27.

EMA decisions are usually endorsed by the European Commission within a couple of months.

Over the years, enthusiasm for Lemtrada, which works by knocking out immune system cells called lymphocytes, has ebbed and flowed and there is still no guarantee it will be approved.

Wellcome, now GlaxoSmithKline, took an early stab at developing the medicine in the 1990s - after acquiring rights via British Technology Group - but gave up.

The drug went back on the market, passing through the hands of U.S. biotech firms Leukosite and then Ilex Oncology, which struck a partnership deal with Schering, now Bayer, in 1999.

In 2001, it was approved as a treatment for B-cell chronic lymphocytic leukaemia (B-CLL) and marketed under the brand name Campath - a reference to the department of pathology in Cambridge where it was created. Sales, however, never took off.

It changed hands again after U.S.-based Genzyme bought Ilex in 2004 - paving the way for a final ownership switch in 2011, when Sanofi bought Genzyme for $20.1 billion.

CROWDED MARKET

Lemtrada's prospects were at centre-stage in that drawn-out takeover battle, leading to an eventual deal that included listed contingent value rights linked to Lemtrada's future success.

Handicapped partly by its late arrival, analysts predict the drug will not be the first choice in a market where competition has exploded with the launch of Novartis's Gilenya and Biogen Idec's Tecfidera, both pills.

"In Europe, there's little doubt it will be kept for fairly advanced stages of MS and I would expect it to be positioned similar to (Biogen's) Tysabri," said Eric Le Berrigaud, an analyst at Bryan Garnier & Co in Paris.

A U.S. regulatory decision on its use is still pending.

Like Tysabri, Lemtrada has a potent effect on MS, which is caused by abnormal immune attacks on the protective sheath surrounding nerve cells. But its potency also raises safety issues and the fact it is given through two cycles of infusions, 12 months apart, means any side effects are not easily reversed.

The consensus for annual Lemtrada sales is some $700 million by 2017, according to forecasts compiled by Thomson Reuters Pharma - a number that could rise "by a few hundred million" if the drug gets a European green light, according to Le Berrigaud.

After all the delays, the drug has patent protection until only 2017 in the United States and 2014 in Europe, although Sanofi says it is "actively pursuing" additional patent cover.

PRICING CONTROVERSY

The drug's long history and existing use in leukaemia poses a pricing dilemma for Sanofi, prompting the French firm to take the unusual step last year of pulling Campath off the market to stop its unauthorized use in MS.

It will, however, still be available free of charge to established B-CLL patients through a special access scheme.

The move gives Sanofi freedom to relaunch Lemtrada at higher price, potentially putting it on a par with other new MS drugs that, in the United States, cost $55,000-$60,000 a year.

In terms of protecting shareholders' interest, it is a smart decision - but some doctors are not impressed. The Lancet medical journal expressed concern in an editorial last year and there is also worry among transplant surgeons who have been using Campath off-label - for other than its designated use - to help prevent rejection after operations.

Roy Calne, a British organ transplantation pioneer, said using Campath slashed the need for costly maintenance drugs and the alternative was 10 times more expensive.

Sanofi CEO Chris Viehbacher, though, needs a decent return from Lemtrada to help offset sales lost as older products face generic competition. He knows the drug better than many: he was working at Wellcome back in the 1990s when the decision was made to discontinue its development.

(Editing by Patrick Graham)

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