Sanofi: Kynamro not strongly supported by FDA briefing documents

Fair Value EUR80 (+15%)       BUY

News published on October Wednesday 17, 2012
Share on

ANALYSIS

  • Yesterday the FDA posted the briefing documents that will form the basis for discussions during the Advisory Committee scheduled on October 18th about mipomersen (Kynamro), inherited from Genzyme. The drug has been developed in collaboration with Isis Pharmaceuticals as a treatment for patients with homozygous familial hypercholesterolemia (HoFH), a genetic disorder found in around 300 people in the United States.
  • Whatever the outcome from the Adcom, the sales target for Kynamro in this indication will be limited whatever the price. First concern is the overall incidence of discontinuation which, in the pooled phase 3 population, was as high as 55% (77 of the 141 individuals) of which 79% (61/77) dropped out for adverse events or severe adverse events. Should Sanofi capture 100% of the available market then more than one out of two people would discontinue treatment. Second concern is that briefing documents are calling for strict REMS (risk evaluation and mitigation strategy) to educate prescribers about the drug and its potential risk of hepatotoxicity and “to limit access to therapy to patients in whom it is medically appropriate”. It is fair to expect strong limitations to use and a black box warning in the label should it be approved. Last element that could also put the approval at-risk despite a clear unmet medical need is that the day before the same AdCom will review another drug in the same indication, namely lomitapide from Aegerion which could appear as a safer alternative.
VALUATION
  • Kynamro is a risky asset today. On the other hand its weight is limited when future sales are considered. We have a 50% probability of success translating into EUR192m peak sales worldwide in 2016. Although it is important for sentiment to get it approved, Kynamro is not relevant to the Sanofi story.
Eric Le Berrigaud, eleberrigaud@bryangarnier.com

The Essentials

Everything you need to know about investment banking dedicated to growth
Stay Informed
Get our news
Join our Team
Bryan, Garnier & Co is always looking for talent in all our divisions, at all levels
Explore our opportunities