Transkaryotic Therapies



Genzyme General


have been fierce rivals in developing a new treatment for Fabry disease, a rare genetic disorder. Now the lengthy competitive battle will finally get an airing at the Food and Drug Administration.

Monday afternoon, both companies said they will present data on their respective drugs at a two-day FDA advisory committee meeting set to start on Sept. 26.

The FDA's Endocrinologic and Metabolic Drugs Advisory Committee will meet to rule on the efficacy and safety of Genzyme's drug, Fabrazyme, on Sept. 26. The same committee will review Transkaryotic's drug, Replagal, on Sept. 27.

Fabry is a rare, painful and fatal genetic disorder that affects only about 5,000 people in North America and Europe. But at an estimated treatment price of as much as $175,000 per person annually, Fabry represents an $875 million market, according to some Wall Street analysts.

The stakes here are high, which was illustrated Monday in the way investors reacted to the respective announcements of an FDA advisory panel hearing. Transkaryotic issued its press release first, at 1:38 pm EDT. In the minutes that followed, the company's stock rose 8%, while Genzyme's stock fell 8%.

Genzyme finally issued its press release at 2:16 pm EDT, prompting relieved investors to flood back in and pushing the stock back into positive territory.

Transkaryotic is up $2.38, or 7%, to $36.30 per share, while Genzyme is up $1.10, or 5%, to $20.97 per share in recent trading.

Genzyme's Fabrazyme was approved for sale in Europe last August. Sales totaled $4 million in the first quarter and the company has said it expects 2002 sales to reach a range of $25 million to $40 million based on European sales alone.

Transkaryotic's Replagal was also approved in Europe last August, with first-quarter sales totaling just over $6 million. The company forecasts 2002 sales of $35 million to $42 million, also based solely on European sales. Demand for Replagal has been higher in Europe because the drug is proving to be

more effective and easier to administer, according to a physician's survey conducted last fall by analysts at SG Cowen. SG Cowen has done banking for Transkaryotic.

Both companies submitted their respective drugs to the FDA for approval in 2000, and both have been asked by regulators to submit additional data. The FDA is supposed to render its decision under "orphan drug" status rules, which means that one drug will be given exclusive rights to the U.S. market for seven years. The FDA, could, however, disregard the orphan drug laws if it finds both drugs approvable but one more effective than the other.

The FDA advisory panel will issue an opinion on the approvability of both drugs during its Sept. 26-27 meeting. Those recommendations will then be passed onto the full FDA for a final decision.