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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Introduction
Asthma is a pervasive and serious disease. An estimated 12MM Americans have
the disease and more than 5000 die annually from it. 1,2 Asthma is also an expensive
disease, direct costs related to asthma amounted to $8.1 B in 2002 and indirect costs
totaled $12.7 B.3 Many pharmaceutical companies have recognized the potential of this
market and have created many drugs to treat the disease. However, while the asthma
market can certainly be described as crowded, there exists a niche of chronic, severe, and
persistent asthma patients that lack an effective treatment.
Protein Design Labs (PDL) is a company seeking to pursue this niche segment
with a therapeutic called Daclizumab, trade name Zenapax®. The drug has just finished
phase II trials and the results have spurred the company onto phase III. This paper will
use secondary and primary data (claims information) to assess and estimate the size of the
asthma market with a particular interest in the segment PDL will be addressing. It will
also address market growth, competition, and regulatory hurdles to get a sense of the
opportunity PDL faces.
Company Overview
Protein Design Labs (PDL) is a Delaware-based corporation with stock publicly
traded on the Nasdaq Exchange under the symbol PDLI. It specializes in developing
therapeutic humanized monoclonal antibodies and in out-licensing patented techniques
and technology integral to the humanization of monoclonal antibodies (mabs).
Typically, PDL out-licenses on a non-exclusive basis, and the company reports
over 40 antibodies in development, through PDL licensing, by pharmaceutical and
biotechnology companies worldwide. Innovator firms utilizing PDL intellectual property
include Biogen, Genentech, GlaxoSmithKline, MedImmune, Millennium, and Wyeth
(PDL company website, May 2004). In addition, PDL has therapeutic antibodies for its
own clinical development for asthma, cancer, autoimmune diseases and antiinflammatory conditions.
PDL also humanizes promising antibodies on behalf of other companies and has
17 agreements to do so. Companies collaborating with PDL for antibody humanization
services include Eli Lilly, Fujisawa, and Novartis.
There are six marketed humanized antibodies as therapeutics and PDL receives
royalties on sales for these products (see table below):
1
"Asthma Prevalence, Health Care Use, and Mortality, 2000-2001," National Center for Health Statistics, Centers for
Disease Control and Prevention.
2
American Lung Association. Epidemiology and Statistics Unit, Best Practices and Program Services. Trends in Asthma
Morbidity and Mortality, February 2002.
3
Cisternas, MG, et al.: "A comprehensive study of the direct and indirect costs of adult asthma," The Journal of Allergy
and Clinical Immunology. 2003, 111:1212.
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Brand Name
Zenapax
Active Ingredient
Daclizumab
Firm
PDL & Hoffman La Roche
Indication
Acute kidney transplant
rejection (immunosuppressive)
Synagis
palivizumab
MedImmune
Anti-viral for lower
respiratory tract disease in
infants
Herceptin
trastuzumab
Genentech
Metastatic breast cancer
(HER2-positive population
only)
RaptivaTM
efalizumab
Genentech
Moderate to severe plaque
psoriasis (immunosuppressive)
AvastinTM
bevacizumab
Genentech
Anti-angiogensis treatment
for metastatic carcinoma of
colon or rectum
Mylotarg
gemtuzumab and
ozogamicin
Wyeth
Relapsed acute myeloid
leukemia (antibody-targeted
chemotherarpy)
PDL’s antibody humanization intellectual property estate consists of four patents
granted to Cary Queen (co-founder) between 1996 and 2001. These patents cover a
method for humanizing an antibody from a non-human counterpart so that antibody
immunogenicity is reduced without interfering with its efficacy (Werber, 2003). These
patents are tabulated below:
Patent #
5,585,089
5,693,761
Issued
Dec. 17, 1996
Dec. 2, 1997
# Claims
11
37
5,693,762
6,180,370 B1
Dec. 2, 1997
Jan. 30, 2001
20
30
Title
Humanized Immunoglobulins
Polynucleotides encoding humanized
immunoglobulins
Humanized immunoglobulins
Humanized immunoglobulins and
methods of making the same
Technology- Zenapax
The table below summarizes the therapeutic mabs PDL has in development and
the specific indications included in the clinical study program (Protein Design Labs
company website, May 2004).
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Monoclonal Antibody
Indication(s)
Zenapax
Asthma
Multiple sclerosis
Type 1 diabetes
Ulcerative colitis
Nuvion
Ulcerative colitis
HuZAF
(anti-gamma interferon)
Anti-51 Integrin
Crohn’s Disease
Anti-51 Integrin Fab
Age-related macular degeneration
Solid tumors
In 1997, the FDA approved Daclizumab for use as an immune suppressant for
acute immune rejection in kidney transplantation. Daclizumab was the first therapeutic
humanized antibody to gain marketing clearance in the United States. Daclizumab is
marketed as Zenapax by Hoffmann-La Roche and PDL receives a royalty on sales. In
2003, PDL re-acquired from Hoffmann-La Roche the rights to develop and market
Zenapax in indications other than acute immune rejection in kidney transplantation. PDL
is pursuing a phase II clinical trial testing Zenapax on a population with moderate-tosevere ulcerative colitis. PDL is preparing a clinical trial to test Zenapax as a potential
treatment for multiple sclerosis.
PDL has completed a phase II clinical study testing Zenapax in a patient
population suffering from chronic persistent asthma poorly controlled by inhaled
corticosteriods. The phase II randomized, double blind, placebo-controlled multi-center
clinical trial treated 114 patients. The clinical study demonstrated a statistically
significant improvement in the forced expired air volume in one second (FEV1). Other
spirometric measures also showed statistically significant improvement. It is proposed
that the humanized monoclonal antibody binds with the IL-2 receptor found primarily on
activated T lymphocyte cells. The mab, by blocking the IL-2 receptor activity on the
activated T lymphocytes, down regulates the immune cascade and thereby averts airway
inflammation and other acute symptoms. Zenapax is classified as an IL-2 receptor
antagonist. The product’s efficacy will be discussed later in comparison to the reference
technology’s efficacy.
Asthma
Asthma is a chronic inflammatory disorder of the airways. Symptoms include
coughing, wheezing, and airway constriction. Asthma is a multi-factor disease.
Typically, environmental and genetic factors contribute to the presence and severity of
the disease state (McFadden ER, 1992). Asthma can occur, regress, and recur at any age.
Typically, asthma is due to a hypersensitivity to allergens.
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Two general classes of therapy exist for the treatment of asthma: reliever therapy
and controller therapy. Controller therapy (also called maintenance therapy) includes
inhaled corticosteroids, long-acting beta2 agonists, leukotriene antagonists, sustainedrelease theophylline, and oral corticosteroids. Reliever therapy, which is intended for the
short-term relief of acute symptoms, consists of short-acting beta2 antagonists. Since
there is no cure for asthma, the primary treatment objective is the long-term, maximum
control of disease so that patients can comfortably lead normal lives. This overarching
treatment objective can be broken down into three related components: increasing lung
function to near normal levels; minimizing symptoms such as coughing, wheezing, and
airway constriction; and controlling the underlying inflammation to decrease the
frequency and severity of acute episodes.
Asthma Epidemiology
No systematic or standardized methods exist to diagnose or to classify asthma
cases (Pearce N, 1998). Because of the absence of clinical and epidemiological methods
of classification, the identification of asthma cases is not consistent. Typically, to
determine the size of the patient population, epidemiologists rely on self-reporting of
asthma symptoms or on physician diagnosis (Decision Resources, 2003).
From a market analysis standpoint, the potential pharmaceutical market for a
novel asthma therapy would comprise those that have been diagnosed with asthma at
some point in their lives (diagnosed population) reduced by the number of asthmatics that
are asymptomatic and therefore no longer seeking relief with therapeutic agents. (Since
asthma can occur, regress, and recur throughout the human life span, the potential market
should exclude those that have been diagnosed at one time but are not currently suffering
from asthma).
For the United States epidemiological estimate, the National Health Interview
Survey data from 1999 were evaluated. Those that self-reported as ever having been
diagnosed with asthma and having had at least one asthma symptom or attack in the past
12 months were counted (Decision Resources, 22). The U.S. estimate does not include
those that have been diagnosed as having asthma and are currently medicated and have
not had an asthma symptom within the last twelve months. Therefore, the reported
numbers are slightly under-estimated (Decision Resources, 22).
United
States
Major
Grouping
Total
2001
11,145,400
2006
11,565,700
2011
11,925,700
Mild Intermittent
4,636,500
4,811,300
4,961,100
Mild Persistent
2,117,600
2,197,500
2,265,900
Moderate Persistent
2,273,700
2,359,400
2,432,800
Severe Persistent
2,117,600
2,197,500
2,265,900
30,623,500
30,962,200
31,140,000
Total
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Global
Mild Intermittent
Markets*
Mild Persistent
12,739,400
12,880,200
12,954,300
5,818,400
5,882,900
5,916,600
Moderate Persistent
6,247,300
6,316,200
6,352,500
Severe Persistent
5,818,400
5,882,900
5,916,600
* Major global markets include U.S., France, Germany, Italy, Spain, United Kingdom,
Japan.
The asthma population can be further divided into four subpopulations, including
mild intermittent, mild persistent, moderate persistent, and severe persistent. These are
defined in the following table:
Subpopulation
Partial Definition
Mild Intermittent
Daytime episodes less than two times per week;
severe episodes one time or less per week.
Mild Persistent
Daytime symptoms at least two times per week;
severe episodes at least two times per week for the
past 12 months
Daytime symptoms two or fewer times every day;
severe episodes every day for the past 12 months
Moderate
Persistent
Severe Persistent
*
Daytime symptoms at least three times every day; 21
or more episodes of symptoms during a typical week
Percent of US
population*
41.6 %
19 %
20.4 %
19 %
(Rabe KF, 2000)
This index of subpopulations, divided by frequency and severity of asthma
episodes, has been used in the Asthma Insights and Reality in Europe (AIRE) study and
the American Thoracic Society (Decision Resources, 25).
Patient advocacy groups and key opinion leaders in asthma have identified several
unmet needs. One of the most pressing unmet needs is therapeutic agents for chronic,
severe, persistent asthma in patients refractory to corticosteroids. Since corticosteroids
are the chief line of defense, these patients have a diminished quality of life.
Furthermore, these patients have high medical costs due to frequent hospitalization. Keyopinion leaders also identified the need for anti-inflammatory controller agents as
effective as corticosteroids without side effects. Lastly, more convenient dosage forms
are likely to improve compliance. These include semi-annual depot injections, once daily
inhalers, once daily or weekly tablets, etc.
The chronic, severe, persistent asthma population that is refractory to, or poorly
controlled by, inhaled corticosteroids has been estimated to be 2 to 3 % of the 2.12
million Americans diagnosed with severe persistent asthma, or 223,000 to 334,000
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Americans (Decision Resources, page 61). This market segment is most likely to adopt
alternative therapies, such as Zenapax. Furthermore, these early adopters are most likely
to receive reimbursement for alternative therapies (since accepted clinical practice
guidelines have not improved their health outcomes). The market size can be roughly
estimated using the price of the reference technology. This technology will be discussed
in more detail later, but Genentech’s Xolair is considered to be the reference technology
and costs about $10,000 annually. This price multiplied by the prevalence of patients
with severe persistent asthma yields a market of $2.2-$3.3B annually.
Medical Practice
Four severity groupings (mild intermittent, mild persistent, moderate persistent,
and severe persistent) have been endorsed by the NIH and the WHO. Pharmacotherapy
recommendations for each severity grouping have been developed by the Global
Initiative for Asthma (GINA). The current stepwise approach to therapy is depicted
below (Decision Resources, 45).
Severity
Grouping
Severe
Persistent
Controller Therapy


Higher-dose inhaled corticosteroid
Long-acting beta2 agonist or sustained-release
theophylline
Long-term oral corticosteroid

Short-acting
beta2 agonist
Higher-dose inhaled corticosteroid
Long-acting beta2 agonist or sustained-release
theophylline
Leukotriene antagonist

Short-acting
beta2 agonist

Short-acting
beta2 agonist


Low-dose inhaled corticosteroid or sustained-release
theophylline
Increase steroid dose or add long-acting beta2 agonist
Consider use of leukotriene antagonist

None

Short-acting
beta2 agonist

Moderate
Persistent



Mild
Persistent
Mild
Intermittent
Reliever Therapy

When a patient first consults a specialist or primary care physician for the
treatment of asthma, the physician is likely to take one of two approaches. For mild
intermittent and mild persistent cases of asthma, the specialist or primary care physician
(PCP) would typically use the “step-up” approach in which therapy is escalated (lowdose ICS before high-dose ICS) until control is achieved.
For moderate and severe cases, the “step-down” approach would be in used. In
the step-down approach, aggressive pharmacotherapy is utilized to gain control over the
disease state. For extreme cases, an oral corticosteroid such as prednisone may be used
as a controller therapy. Once control is gained, the oral corticosteroid would be replaced
with a high-dose inhaled corticosteroid. The high-dose inhaled corticosteroid could then
be further reduced while being complemented with steroid-sparing agents such as
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
leukotriene antagonists and long-acting beta2 agonists. The regimen is moderated and
reduced until no further decrease in dosage or frequency is appropriate.
Therapeutic Trends
In the United States there are three major treatment trends or deviations. First, the
leukotriene antagonist Singulair, manufactured by Merck, is highly prescribed (possibly
over-prescribed) and highly popular. Singulair, a twice-daily tablet treatment, is a
convenient and popular dosage form. It is not considered sufficiently potent to replace
higher dose inhaled corticosteroids (ICS) but it may be an ICS-sparing agent. Second,
primary care physicians tend to under-prescribe corticosteroids, particularly in children,
for fear of side effects. And lastly, combination therapies that combine a long-acting
beta2 agonist with an inhaled corticosteroid are immensely popular with patients because
fewer inhalers need to be carried and used within the course of a day. There is evidence
that this ease of use contributes to greater patient compliance and therefore improved
management of asthma symptoms. GSK’s Advair (salmeterol plus fluticasone) and
AstraZeneca’s Symbicort (formoterol plus budesonide) are both popular combination
therapies.
Reference Technology and Product Efficacies
With the introduction of Xolair, physicians have an entirely new approach to
treating asthma. Xolair (omalizumab) is the first biotechnology product for the asthma
market. Omalizumab is a recombinant DNA-derived humanized IgG1k monoclonal
antibody developed by Genentech and Novartis. It inhibits the binding of IgE to the
high-affinity IgE receptor on the surface of mast cells and basophils, thereby reducing the
release of mediators to the allergic response. Omalizumab reduces the incidence of
asthma exacerbations in adults and adolescents. It received FDA approval in June 2003
for the treatment of moderate-to-severe persistent asthma when the symptoms of asthma
are poorly controlled by inhaled corticosteroids. Omalizumab is received by the
pharmacist as a lypholized powder which is reconstituted prior to subcutaneous injection
(up to three injections per visit may be required). It is administered every two to four
weeks and the doses and dosing frequency are determined by body weight and blood
serum total IgE level (blood sample is taken at the start of treatment). The 150 mg vial of
Xolair has an average wholesale price of $541.25 (Thomson PDR Red Book UPDATE,
March 2004). The estimated typical annualized cost of treatment on a per patient basis
ranges from $8,000 to $12,000.
IMS Health online data for total prescriptions (TRx) and new prescriptions (NRx)
on a per month basis is tabulated below. Total prescriptions (TRx) is the total treated
population in a single month. The new prescriptions (NRx) are treatments for individuals
that have not been treated with Xolair previously.
Xolair (omalizumab), 150 mg vial, NDC 50242-0040-62, IMS Health data:
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Month
July 2003
August 2003
September 2003
October 2003
November 2003
December 2003
January 2004
February 2004
March 2004
TRx
(Prescriptions)
14
135
429
644
768
1034
923
1090
1462
NRx
(New prescriptions)
14
128
342
401
356
396
355
334
472
Sales ($)
$108,963
$224,321
$904,780
$1,188,207
$1,544,898
$2,087,921
$1,819,621
$2,079,655
Not available
Since the product was launched in June 2003, the low number of prescriptions and
total sales does not indicate the size of the potential market. However, the steady state or
“plateau” performance of Xolair (omalizumab) may be an important indicator of total
market size for PDL’s Zenapax.
Xolair (omalizumab) and Zenapax could be direct competitors (after Zenapax
receives regulatory approval). Both therapies are targeted for moderate-to-severe
persistent asthma. Both therapies are broadly classified as immunosuppressive agents.
Both therapies require preparation and administration (injection) by trained health
professionals. The clinical study populations for both therapies consist of those that are
poorly controlled by inhaled corticosteroids. Zenapax is likely to be as expensive as
omalizumab because of the costs inherent in the manufacture and development of
humanized monoclonal antibodies.
Asthma product efficacies are measured using two indicators; a reduction in the
number of disease episodes and a change in FEV1. FEV1 values measure how much air
volume can be expired in one second. Xolair’s clinical trials were run using Xolair in
addition to inhaled corticosteroids. A change in both disease episodes and in FEV1
levels was then measured. PDL’s clinical trials mirrored this format, but only measured
changes in FEV1. Xolair was administered every two or four weeks and Zenapax was
administered every two weeks. Xolair is dosed based upon patient weight and serum
levels of IgE. However, patients generally receive between 1.5 to 5 mg/kg. Zenapax was
dosed solely upon patient weight patients received an initial dose of 2 mg/kg and
subsequent doses of 1mg/kg.
Clinical trial’s indicated that using Xolair in addition to inhaled corticosteroids
improved FEV1 measurements by 3% over using only inhaled corticosteroids. This
translated into a change in disease exacerbations of minus one over the course of the trial.
Zenapax’s phase II trials also indicated a 3% change (2.9% to be exact) in FEV1 and this
will be interpreted to also have a decrease in exacerbations of one per trial period (12
weeks). Hence, Zenapax can be thought of as a me-too drug with an almost identical
efficacy to Xolair.
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
While Xolair may remain a niche therapy for severe allergic asthma, Zenapax still
has opportunities for developing value prior to market launch. For instance, if Zenapax
could be reformulated such that the treatment could be self-administered, then the
increased convenience may result in more scripts. A sub-lingual (beneath the tongue)
lozenge would bypass the acids of the digestive system (just as an injectable does) and
would not have the inconvenience and expense of an injectable administered by a health
professional. Alternatively, Zenapax could be reformulated and repackaged into a unitdose subcutaneous injectable (one use pre-filled syringe for a single treatment). This type
of injectable can be self-administered (this is the dosage form used for most insulin
treatments). Finally, if Zenapax were longer acting (one injection every six months) than
Xolair it could have greater market potential.
Claims Data Analysis
Search Criteria:
A series of queries was run to identify qualifying members of a non-medicare
patient population who received treatment and filed claims with their providers during
2002. The following ICD9 codes were used to identify patients in our interest group—
those diagnosed with asthma at least once during the calendar year 2002:
ICD9 Code
Description
49393
Asthma, unspecified
49391
Asthma w Status Asthmaticus
49392
Asthma w Acute Exacerbation
49394
Asthma
Results:
The results of the claims data search are summarized in the table below. Notice
that the qualifying sample size is 1,402 patients. This represents less than 0.17% of the
entire 850,000 member database. By far, the bulk of the paid claims are for inpatient
expenditures. This is not surprising given the costs associated with hospitalization and
emergency care as they compare with physician and pharmaceutical costs.
Claims Data Results (Non-Medicare population)
N = 1402
Age
Mean
Median (50 %-ile)
Range
Std. Deviation
25
19
88
20.6
Total Inpatient
Claims paid for
Patient
$ 7,275
$0
$ 553,000
$ 27,000
Total Physician
Claims paid for
Patient
$ 2,040
$ 863
$ 178,000
$ 5,800
Total Pharmacy
Claims paid for
Patient
$ 856
$ 323
$ 21,000
$ 1,600
Total Costs/
Patient (could
include nonasthma costs)
$ 10,200
$ 2,500
$ 569,000
$ 28,800
Source: HSI Network, LLC
Fifty patient profiles were selected randomly from the 1,402 member sample and
reviewed. The average hospitalization and pharmacy costs were higher in this group than
the larger sample, whereas the physician claims values were lower. However, these
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
values are not outside of what can be expected from the population, overall. The
following table illustrates the average costs for these patients.
Patient
#
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
Male
Female
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
ER
Visits*
Hospitalization
Physician
Pharmacy
Total
2
1
0
1
0
0
0
0
0
1
0
0
1
3
2
0
0
0
1
3
1
7
0
0
2
0
0
1
0
0
0
0
2
0
1
0
6
0
0
0
0
0
1
1
$0
$18,928
$1,316
$277,022
$0
$2,068
$0
$0
$1,270
$0
$0
$0
$15,193
$68,916
$15,434
$13,653
$0
$0
$0
$0
$1,135
$37,587
$0
$0
$0
$5,006
$13,886
$0
$0
$0
$0
$0
$0
$0
$0
$0
$11,060
$0
$5,006
$470
$1,431
$0
$6,837
$0
$992
$1,010
$1,644
$261
$77
$259
$4,392
$1,626
$90
$287
$166
$1,589
$816
$1,499
$3,138
$268
$739
$3,584
$6,554
$1,631
$5,507
$5,861
$76
$57
$5,811
$5,187
$548
$154
$998
$0
$38
$1,054
$1,126
$553
$2,679
$3,629
$9,357
$33
$15
$32
$70
$230
$1,373
$780
$215
$999
$254
$272
$0
$651
$140
$0
$1,170
$0
$1,146
$1,164
$0
$303
$0
$335
$676
$1,873
$2,399
$239
$0
$1,668
$487
$106
$1,634
$824
$10,115
$702
$700
$225
$380
$973
$0
$231
$3,545
$0
$12,461
$672
$0
$0
$0
$115
$33
$159
$1,207
$20,937
$3,214
$277,555
$77
$2,978
$4,532
$1,626
$2,530
$287
$1,312
$2,753
$16,009
$70,718
$18,572
$14,256
$1,415
$5,457
$8,953
$1,870
$6,642
$45,116
$563
$163
$7,445
$11,017
$24,549
$856
$1,698
$225
$418
$2,027
$1,126
$784
$6,224
$3,629
$32,878
$705
$5,021
$502
$1,501
$345
$8,243
$939
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
45
46
47
48
49
50
Total:
1
1
23
4
1
0
0
0
0
42
1
1
1
1
27
Avg:
$408
$10,531
$8,404
$0
$0
$1,774
$517,335
$1,867
$1,618
$557
$578
$527
$251
$81,188
$24
$331
$952
$58
$494
$2,120
$50,845
$2,299
$12,480
$9,913
$636
$1,021
$4,145
$649,368
$10,347
$1,624
$1,017
$12,987
When considering the number of emergency room visits, the following criteria
were employed:
A Patient must have presented at the ER with at least one of the following
diagnoses as either the primary or secondary diagnosis.
ICD9 Code
Description
4939
Asthma, NOS
5191
Trachea/Bronchus Dis NEC
7862
Cough
7931
Abn Findings-Lung Field
46611
Acu Broncholitis d/t Rsv
49300
Ext Asthma w/o Stat Asth
49302
Ext Asthma w Acute Exac
49310
Int Asthma w/o Stat Asth
49391
Asthma w Status Asthmat
49392
Asthma w Acute Exacerbtn
78605
Shortness of Breath
78607
Wheezing
78609
Respiratory Abnorm NEC
78650
Chest Pain NOS
78652
Painful Respiration
78659
Chest Pain NEC
For those patients who did visit the ER once or more under these conditions (20
patients out of 50), the average number of visits was 2.1 per year. For the fifty-person
sample as a whole, the average number of visits was less than once a year (See Table
below).
Claims Data Results—Fifty Patient Cases, calendar year 2002
N = 50
Age Range
Sex
Avg. Number of Asthma-Related ER visits
Avg. Number of Asthma-Related ER visits for patients visiting at least once
Avg. Hospitalization Claims paid
Avg. Physician Claims paid
Avg. Pharmacy Claims paid
1 year-58 years
23 M, 27 F
0.84
2.10
$ 10,347
$ 1,624
$ 1,017
Source: HSI Network, LLC
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Cost-Effectiveness Analysis
The best reference case to compare Zenapax® with is Genentech’s therapeutic,
Xolair®. Given the lack of claims data for this therapy, we have decided to describe the
methods by which we might arrive at a reasonable cost-effectiveness ratio using the logic
that if long-term treatments with Zenapax reduced the number of episodes of severe,
acute respiratory difficulty, then a cost effectiveness ratio can be calculated.
The Cost-Effectivenes is defined as the ratio of the change in costs divided by the
change in quality-adjusted life years (QALYs):
CE =
=
(Change in Costs)
(Change in QALYs)
(Costs of new therapy – costs of replaced therapy)
(QALYs with new therapy-QALYS with replaced therapy)
In order to analyze the cost effectiveness of Zenapax, the following assumptions were
made:
1. The costs of treating patients long-term with Zenapax® are known.
2. The costs of treating patients long-term with combinations of therapeutics
(excluding costs of Zenapax) to control episodes of acute respiratory difficulties
are known.
3. The rehabilitative costs associated with caring for patients with such episodes
(including hospitalization, physician care and pharmaceuticals) are known.
4. Long term treatment with Zenapax® in combination with other therapeutics can
significantly reduce the number of acute exacerbations in asthma sufferers.
5. The QALYs of both current treatment regimens and treatments adding Zenapax are
known.
Therefore, we consider the QALYs of a patient with fewer episodes to be higher
than those with more. Provided that the actual administration of Zenapax does not
significantly reduce a patient’s QALY score, and the costs associated with treating
patients long term with Zenapax are less than the systematic savings realized by a
reduction in episodes of acute respiratory exacerbation, the following holds:
1. (Costs of therapy including Zenapax – costs of reference treatment) < 0
2. And (QALYs calculated with Zenapax treatment – reference treatment
QALYs) is not large and negative.
Therefore, treatment with Zenapax is cost-effective.
Regulatory Factors Affecting Development and Commercialization
PDL spent $91 million on capital expenditures to build a state-of-the-art
biopharmaceutical manufacturing facility in Brooklyn Park, Minnesota. Manufacturing
compliance is particularly problematic for biologics due to the high degree of inherent
variability in production inputs. Modern bio-manufacturing process control systems and
methodologies are critical to achieving FDA prior-approval inspection authorization.
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
Furthermore, cutting edge bio-manufacturing is critical to achieving consistent batch
release during the commercial phase. PDL’s new bio-manufacturing facility reduces
regulatory risk.
The existence of a predicate product (Xolair) greatly simplifies the product
development and regulatory approval process. PDL can rely on the regulatory precedent
(and the internal FDA consensus) to reduce project-related risk. PDL, if it chooses, can
adopt many of the clinical study designs and clinical endpoints that the manufacturer of
Xolair has already negotiated with the agency. Therefore, the existence of a predicate
product reduces regulatory risk.
Zenapax is already marketed for the treatment of acute kidney transplant
rejection. Therefore, marketing Zenapax for the treatment of a new indication (asthma)
would only require filing a supplement to the original biologics license application (BLA)
with the agency. There are a number of safety studies in animals and in humans that
would not need to be performed in order to market Zenapax for asthma because these
studies were completed as part of the original biologics license application. Therefore,
the existence of a biologics license application reduces the regulatory risk of approval.
The FDA has recently been re-organized. Certain application reviewing divisions
within the Center for Biologics Evaluation and Research (CBER) have been transferred
to the Center for Drug Evaluation and Research (CDER). Historically, most biologics
were reviewed by CBER and most synthetically-derived therapeutics were reviewed by
CDER. The agency has transferred the biologics license application review process to
CDER in order to provided greater speed and consistency in reviews. CDER is perceived
internally and externally to have a more operational emphasis compared to CBER’s
greater research emphasis. It is not yet known whether this re-organization will lead to a
more efficient, consistent, and transparent review process.
In conclusion, based on the factors listed, the overall regulatory risk is moderated
by a number of favorable factors.
Conclusion
PDL is pursuing a segment of the asthma market that represents roughly $2-3B
annually. However, this segment is not unoccupied and many drugs are formulated to be
used in concert with inhaled corticosteroids. In direct competition there is also
Genentech’s Xolair. Unfortunately, due to its similar efficacy with Xolair, Zenapax will
likely be viewed as a me-too drug. This has positive and negative implications. It may
be easier to get reimbursement since a drug already exists in the market and has proven
cost effective enough for insurers to cover it. PDL will be able to piggy-back on the CE
data since their drug has almost identical effectiveness. Additionally, PBM’s will want to
promote price competition and a me-too drug will allow this. On the other hand, this has
negative implications for Zenapax’s margins as it will likely have to compete on price.
One option PDL has that would allow it not to compete on price is to make the drug’s
delivery easier. For example, it could make the drug self-administrable or longer lasting.
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Market Analysis of Daclizumab for Asthma and Overview of Protein Design Labs, Inc.
As with any new drug, Zenapax will face considerable marketing challenges.
PDL will likely have to partner with a larger pharmaceutical company to get its product
information out to physicians. Finally, PDL should think critically about its phase III
trial format. If PDL does not desire to be a me-too drug, it will have to format its next
trial to use an easier delivery method that will prove to be just as effective as Xolair.
American Lung Association (ALA). Trends in asthma morbidity and mortality.
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