Eli Lilly: Hope To Talk To FDA On Arxxant

Drug Pipeline report

Eli Lilly & Co. (LLY) hopes to meet with the U.S. Food and Drug Administration in the next few weeks to clarify what new data is necessary to gain approval for Arxxant, a medication to treat a diabetic eye disease, the drug maker's chief executive said Thursday.

"We do not have a meeting scheduled but I am hoping for (a meeting)" in the next few weeks, Chairman and Chief Executive Sidney Taurel told Dow Jones Newswires in an interview.

The FDA said that there was "very good initial data to make the product approvable" but that the regulatory agency needed more, he said.

It's unclear whether that means more mining of the data from existing trials, waiting for data from existing trials or totally new trials, Taurel said. "They have not yet asked for specific extra information," he said.

As the first oral treatment for diabetic retinopathy, Arxxant has the potential to be a big seller for Eli Lilly. The disorder can cause blindness and affects at least a third of the world's estimated 230 million diabetics.

Arxxant is the only drug the company currently has in the FDA approval process. Others are in late-stage clinical trials, including prasugrel, which the firm expects to submit for approval in the second half of next year.

The company, maker of the popular antidepressant drug Prozac, had almost $15 billion in sales last year.

Taurel later said, according to an executive, it's uncertain what, if any, impact the additional data requirement will have on the commercial launch of Arxxant, known scientifically as ruboxistaurin mesylate. When Eli Lilly applied for FDA approval in February, the start was originally set for 2007. Then in April, the agency put it on a fast track vetting process that could have seen the drug hit the market as early as this year.

The Indianapolis-based drug maker received the additional requests from the FDA in an approvable letter Aug. 18, indicating the agency might authorize the drug.

Developing Blood Thinner With Daiichi-Sankyo

Taurel said trials indicate that a blood thinner to prevent heart attacks, being developed with Japanese pharmaceutical maker Daiichi-Sankyo Co. (4568.TO), will be more effective than rival drug Plavix, as well as its generic version.

Plavix, the second-biggest selling drug in the world last year, generated global sales of about $5.9 billion.

The two companies have been jointly studying a compound called prasugrel since 2000. They're in the midst of a late-stage trial to determine whether prasugrel is more effective than Plavix in treating certain heart patients. The trial should be completed in 2007, with a submission for regulatory approval by the end of the year.

"We have a lot of data in early development which shows that prasugrel is superior to Plavix," he said. "We are very optimistic that we will have a better product."

Other pharmaceutical companies such as AstraZeneca PLC (AZN) and Medicines Co. (MDCO) are also studying so-called anti-platelet medications as potential rivals to Plavix, which is co-marketed by Sanofi-Aventis (SNY) and Bristol-Myers Squibb Co. (BMY). The experimental drugs, which like Plavix are designed to prevent heart attacks and strokes in at-risk patients, are still a couple of years from reaching the market.

Apotex Inc., a Canadian generic-drug maker, began selling a copycat version of Plavix Aug. 8 amid a patent-infringement dispute with Sanofi of France and New York-based Bristol. If generic Plavix remains on the market, its price could fall substantially below that of branded Plavix, hurting the overall value of the anti-platelet market.

A hearing in federal court in New York could help determine whether generic Plavix stays on the market. A two-day hearing on an injunction request by Sanofi and Bristol ended last week.

Taurel said the legal situation on generic Plavix is unclear, but that prasugrel still ought to be able to compete well because of its apparent higher effectiveness.

"The bar has definitely been raised (by prasugrel) because you need to show real superiority when you compare with a lower priced product - generics come at much lower price. But we are optimistic that the data will enable us to compete very effectively against generic," Taurel said.

However, Prudential analyst Tim Anderson wrote in a recent note to clients that he would probably cut by half his forecast of 2010 prasugrel sales of $2 billion if generic Plavix stays on the market. That could hurt Lilly's earnings growth in 2008 and beyond.

The chief executive also said that the company will mainly stick to its strategy of organic growth and partnering with other drug firms in developing new medications. However, he said that the company is always on the lookout for promising small and mid-cap companies to acquire, especially those specializing in diabetes care, cancer, neuroscience and osteoporosis.

Taurel is on a four day trip to Japan to meet with corporate partners, regulatory officials and lawmakers.

A member of a U.S. trade advisory panel, the President's Export Council, Taurel also gave a speech Thursday to business executives on a possible U.S.-Japan free trade agreement and discussed the issue with Japanese officials including, trade minister Toshihiro Nikai and Foreign Minister Taro Aso.