How to Prepare for BioMarin's (and Biotech's) Biggest Event of 2015
Game on, BioMarin Pharmaceuticals (BMRN) - Get Report .
On Nov. 24, a panel of outside experts convened by the U.S. Food and Drug Administration is set to review drisapersen, BioMarin's experimental drug for Duchenne muscular dystrophy (DMD).
Investors have been debating the future of drisapersen for years, so it's exciting to be finally on the cusp of a definitive outcome for the drug. Obviously, the people suffering from DMD and their families have even more at stake.
I'm not over-selling when I say the BioMarin drisapersen FDA panel is a really big deal. To get you prepared, let's dig into the hot issues and burning questions.
Are investors optimistic or pessimistic about drisapersen's chances at the FDA advisory panel?
Investor sentiment skews positive. The drisapersen clinical data are a mess (for reasons I'll discuss below) and the questioning may get heated at times, but Wall Street does expect BioMarin to exit the FDA panel with a recommendation favoring approval.
And what about the impact on BioMarin's stock price?
There's probably more downside risk than upside in BioMarin's current stock price given the positive sentiment. One investor source who spends a lot of time using options to play big biotech catalyst events like the drisapersen FDA panel says there's probably $25-ish in downside versus $15-$20 upside.
At BioMarin's current stock price of $108, that means a move to $125-$130 (round numbers) on a positive panel vote or down to $85 on a negative vote.
RBC Capital analyst Michael Yee predicts a similar range for BioMarin -- a 15% move higher to $123 on a positive vote or a fall to $80-$85 on a negative vote.
Big events can exaggerate the already-high volatility seen in biotech stocks, so don't be surprised if BioMarin shares shoot past these forecasts, at least initially.
Can we trade BioMarin on Nov. 24?
Biotech stocks are usually halted for FDA advisory panels. The drisapersen panel will start around 8 a.m. ET and runs all day, so if BioMarin is halted, it won't open for trading until well after the 4 p.m. close.
And what about Nov. 20? Won't that be a crazy day for BioMarin's stock price?
Ah! You're getting ahead of me. The FDA will post briefing documents for the drisapersen panel on Friday. Importantly, these briefing documents will include the FDA's medical and statistical review of the drisapersen efficacy and safety data. In other words, we'll get an early view Friday of how the FDA feels about drisapersen. This view -- positive or negative -- will have an impact on BioMarin's stock price.
Where can I find these drisapersen briefing documents on Friday?
Bookmark this link to the FDA's advisory committee documents web page. Start refreshing the page around 7 a.m. ET on Friday morning. The documents will probably be posted closer to 8 a.m. but you can never be sure. Alternatively, watch Twitter on Friday morning. You'll find live links to the drisapersen briefing documents within seconds of their availability.
Are you live-blogging the drisapersen FDA advisory panel on Nov. 24?
Why, yes, I am. Thank you for allowing me to plug that live blog. Stay tuned for more details but count on me live-blogging the Biomarin drisapersen panel in its entirety.
Can you explain Duchenne muscular dystrophy and how drisapersen treats it?
Yes, let's dig into the meat of the disease and the issues facing drisapersen on Nov. 24.
Duchenne muscular dystrophy is a rare, genetic disease caused by a mutation on the X chromosome. This mutation, in turn, results in malfunctioning or missing dystrophin, a protein necessary for proper muscle function. Boys with DMD (the disease almost always strikes boys) suffer from progressive weakening of their muscles. By around 12, they can no longer walk. The disease also affects breathing and heart function. Few DMD patients live beyond 30.
Since DMD is caused by a mutation in the gene encoded to make dystrophin, one approach to treating the disease is to design a drug capable of removing or "skipping over" the damaged section, or exon, of the gene. Doing this allows the gene to produce dystrophin that is partially functional and stabilize muscle function.
Drisapersen is an "exon-skipping" drug designed to target the defect at exon 51 on the dystrophin-producing gene. Approximately 13% of the 30,000 DMD patients in the U.S. have a defect at exon 51 which could be treated with drisapersen.
If drisapersen works. Does it?
That's the billion-dollar question! I expect a lot of the debate at the Nov. 24 panel will focus on the phase III study. Conducted by GlaxoSmithKline (GSK) - Get Report and Prosensa (before BioMarin acquired Prosensa), the phase III study enrolled 186 DMD patients, randomized to treatment with drisapersen or a placebo. The study's primary endpoint, measured at 48 weeks, was the distance walked by patients in six minutes, known as the six-minute walk test (6MWT).
Over 48 weeks, the performance on the 6MWT decreased by 42.3 meters for the drisapersen-treated patients compared to a 52.7-meter drop in placebo patients. The treatment difference, 10.3 meters, favored drisapersen but missed statistical significance by a wide margin. The phase III study failed badly.
If the drisapersen phase III study failed, why is there any optimism for BioMarin securing FDA approval?
Because the "totality of the data" suggest DMD patients benefit from treatment with drisapersen, according to BioMarin.
What does "totality of the data" mean?
It means the drisapersen data are complicated. So FDA, please look beyond the failed study and consider all the studies and data, which paint a nicer picture.
I assume BioMarin has more data on drisapersen and an alternative explanation of the phase III study to woo the FDA and the experts on the advisory panel?
Yes. BioMarin argues the DMD boys enrolled in the phase III study were, on average, more severely disabled at baseline. This made it more difficult for drisapersen to have a beneficial effect, which explains the failure to demonstrate a statistically significant improvement in the 6MWT compared to placebo.
At the panel, BioMarin will offer an alternative analysis of the phase III study showing subsets of younger DMD patients and patients with stronger walk performance at baseline benefited more from drisapersen. BioMarin also believes that an imbalance in the baseline characteristics of the DMD patients in the study skewed the study in favor of placebo. When the imbalances are corrected, the benefit of drisapersen is more apparent.
Is all that enough to convince the expert panel to recommend drisapersen's approval?
Probably not, which is why BioMarin will also emphasize smaller, phase II studies in which drisapersen demonstrated larger improvements in the 6MWT compared to placebo. When these two phase II studies are pooled together, drisapersen-treated DMD patients walked 31 meters further in six minutes than the placebo patients. The difference was statistically significant.
There will be a lot more efficacy data hashed over at the FDA panel, but you get what I mean by "totality of the data." No single piece of scientific evidence is likely to convince FDA to approve drisapersen, but when all the evidence is assessed together, combined with the severity of the disease, the argument favoring drisapersen's approval becomes more persuasive.
That's what BioMarin hopes, at least. The collective data are still a mess, which is why I expect the FDA panel debate on Nov. 24 to be contentious at times.
I'm also curious to see if FDA is displeased with BioMarin's decision to hold off on conducting a confirmatory study of drisapersen until after the advisory panel. This has been a controversial strategy which I've written about previously.
What about the safety of drisapersen? Isn't safety an important element in the approval decision?
Absolutely. Drisapersen is not an easy drug for DMD patients to tolerate. The drisapersen injection, just under the skin, is painful and causes welts and skin ulcers. More concerning, drisapersen has been linked to kidney problems like abnormal quantities of protein in urine. Adverse events and safety concerns caused a significant number of patients to skip drisapersen injections during the clinical trials.
I expect concerns about drisapersen's safety and tolerability will be aired during the Nov. 24 FDA panel, but DMD is a fatal disease, so nothing is likely to rise to the level of disqualifying the drug's approval.
BioMarin will lobbying hard to convince the FDA panel to vote for an approval recommendation, obviously, but will the company benefit from any outside help?
Hmmm... I think you actually know more about this drisapersen panel than you let on. Smack dab in the middle of the FDA panel, right after the lunch break, the FDA will invite DMD patients, their families, DMD advocates and any interested member of the public to address the experts on the panel. Typically, the FDA sets aside one hour during advisory panels for the open public hearing. On Nov. 24, FDA set aside two hours because it expects an unusually large large number of people to speak.
Aren't these patient testimonials predictably supportive of the drug's approval and therefore not very influential on the outcome of the advisory panel? I mean, do you really expect anything interesting to emerge from the two hours of public testimony?
Wow, you're so cynical. I totally disagree. The open public hearing at the drisapersen panel is going to be fascinating and important to the final vote.
For instance, you're going to hear from Denise Taborski of Pittsburgh. Her son received drisapersen as part of a phase II study in 2012. Today, Taborski's son is being treated with eteplirsen, the DMD drug being developed by Sarepta Therapeutics (SRPT) - Get Report, as part of another clinical trial. This makes Taborski's perspective unique because few DMD patients have been treated with both drugs.
I spoke to Taborski last week as she prepared for the Nov. 24 panel. "I'm nervous, I'm not a public speaker," she told me. Taborski plans to tell the invited experts to approve drisapersen but will also talk about the drug's adverse side effects. She believes her son benefitted from drisapersen. On trips to a local park, for instance, she and her husband noticed that he could walk up steps he couldn't handle before taking the drug, she says.
However, drisapersen was also tough on her son's kidneys. He was forced to miss drisapersen injections several times during the trial and required constant monitoring.
Sarepta's eteplirsen is not part of the Nov. 24 FDA panel, but Taborski wants it to win FDA approval, too. Three years passed between her son stopping drisapersen and starting on eteplirsen. In that interval, his DMD progressed to the point that a " family walk" at the mall meant being pulled in a wagon by Mom or Dad. Seven months later, Taborski's son walks the mall unassisted and the eteplirsen injections aren't causing any side effects.
"There should be choices," said Taborski, of her belief that both drisapersen and eteplirsen receive FDA approval. "It's good that there are two drugs."
I'm glad you brought up Sarepta. I know the Nov. 24 panel is about BioMarin and drisapersen, but how can Sarepta and eteplirsen not play a role?
It's a good question. I hate to sound cliched but eteplirsen is going to be the proverbial pink elephant in that room on Nov. 24 given the competitive and sometimes nasty rivalry between BioMarin and Sarepta. [A separate FDA advisory panel for eteplirsen is scheduled tentatively for Jan. 26.]
If eteplirsen comes up on Nov. 24, it will be during the two-hour public hearing as parents of DMD kids and advocates urge the FDA to approve both drugs so patients and their doctors have a choice, says Debra Miller, founder and president of CureDuchenne, an advocacy group.
"We've supported both companies and we're hopeful and cautiously optimistic that both of these drugs will be approved and we'll have options for our boys," Miller told me.
Jenn McNary, a vocal proponent of Sarepta's eteplirsen, is also attending the drisapersen panel and will speak during the public hearing. Her son Max was a patient in Sarepta's phase II study and continues on the drug successfully for more than three years. He's still able to walk, McNary's other son, Austin, is in a wheelchair but also recently started treatment with eteplirsen.
"No one is going to be bashing drisapersen," said McNary. "I'm a mom who came into this because I believe I saw a drug changing my kid's life. But I'm also an advocate in this situation, so I'm advocating for what people seem to want -- the choice to be on whatever drug they and their doctor want them to be on."
Nicely said.
Agreed.
Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.