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Novartis MS Drug Reduces Relapses

Stocks in this article: NVS BIIB

Novartis (NVS) announced Friday late-stage results from a clinical study that showed its experimental daily pill for multiple sclerosis was more effective than a currently approved injectable drug sold by Biogen Idec (BIIB).

The Swiss-based drug maker said it intends to seek regulatory approval for the drug, FTY720, in the U.S. and Europe by the end of 2009. If approved, FTY720 would offer patients with relapsing-remitting multiple sclerosis, the most common form of the disease, the convenience of an oral treatment for the first time.

However, serious safety concerns have dogged FTY720, including reports of fatal infections and increased risks for heart and liver problems. While all existing multiple sclerosis drugs carry side-effect risks, FTY720's safety profile is likely to be scrutinized very closely by regulators.

The global market for MS drugs is expected to reach $5.8 billion in 2008, according to a recent report from JPMorgan.

Biogen Idec's Avonex is the market leader with 2007 sales $1.9 billion, followed closely by Sanofi-Aventis' (SNY) Copaxone, Merck Serono's Rebif and Betaseron from Bayer. The most recently approved MS drug was Tysabri, marketed by Biogen Idec and Elan (ELN).

All these drugs are administered by injections, which leaves them commercially vulnerable to an oral MS drug, if one can be approved that is equally or more effective with an acceptable safety profile.

The "Transforms" study reported by Novartis Friday was the first head-to-head comparison of FTY720, taken as a daily pill, against Biogen Idec's leading multiple sclerosis drug Avonex, which is administered via a weekly injection.

The results showed that MS patients treated with FTY720 experienced significantly fewer disease relapses than patients taking Avonex. The annualized relapse rate after one year of treatment with FTY720 was reduced by 52% at the low dose and 38% at the high dose compared with Avonex patients, according to Novartis. The results from both doses of FTY720 compared with Avonex were statistically significant.

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