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Blockbuster hopes for AstraZeneca's roxadustat ahead of US FDA decision

Analysts see blockbuster potential in AstraZeneca PLC's roxadustat, an anemia drug for patients with chronic kidney disease, or CKD, which has been approved in China and is awaiting the imminent green light from U.S. regulators.

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The U.S. FDA has set a decision date for roxadustat of Dec. 20.
Source: U.S. FDA

The U.S. Food and Drug Administration expects to rule on the drug Dec. 20, with a positive decision forcecast by many analysts, capping a winning streak this year for the Cambridge, U.K.-based AstraZeneca following positive efficacy data for its coronavirus vaccine, and the intention to acquire Boston-based Alexion Pharmaceuticals Inc. for $39 billion, broadening its therapeutic offering to include rare disease and immunology.

Roxadustat is based on the Nobel prize-winning discovery of the HIF-pathway, which mimics the body's natural response to low oxygen levels, by scientist Dr. William Kaelin Jr., a Howard Hughes Medical Institute investigator. This innovative approach has offered a breakthrough in treating patients with anemia in CKD an area that had seen little advancement in three decades and where standard treatment has remained erythropoietin, or EPO.

"When we discovered the mechanism, [it] turned out to be surprisingly simple and elegant. And you might even argue, beautiful, but that was a tribute to nature, that wasn't a tribute to me or my fellow laureates," said Kaelin, who is Sidney Farber Professor of Medicine at the Dana-Farber Cancer Institute and Brigham and Women’s Hospital, in an interview with S&P Global Market Intelligence.

Anemia is characterized by low levels of hemoglobin, a protein in red blood cells that carries oxygen to cells in the body. Severe anemia is common in those with cancer, inflammatory conditions and other serious illnesses including CKD where it is associated with increased cardiovascular complications and death, as well as significant fatigue, cognitive dysfunction and decreased quality of life. CKD affects more than 200 million patients worldwide and can eventually lead to kidney failure.

"Roxadustat is already approved in China so I see no reason why [the] FDA wouldn't give it the green light," said one longstanding AstraZeneca analyst. "It should definitely be a blockbuster in my view given that it is much more convenient than EPO," the analyst said, speaking to S&P Global Market Intelligence on condition of anonymity.

More indications to come

Tarek Rabah, AstraZeneca's vice president of U.S. renal-cardio, said the company intends to seek approval for roxadustat in a number of other indications in addition to the initial filing: for anemia in myelodysplastic syndrome, or MDS, which is caused by immature bone marrow cells; and for chemotherapy-induced anemia. In the U.S. alone, around 650,000 cancer patients receive chemotherapy every year, with an estimated 60% to 90% going on to develop anemia.

"We are very, very confident that at least in dialysis, where EPO has been used for a long, long time, we have a clear, competitive differentiation," Rabah said in an interview with S&P Global Market Intelligence. "We're hoping with roxadustat and with the data that we have in terms of efficacy, showing that we are as safe as a placebo which is a gold standard, who can do better than that? would be a really good convincing factor," he added.

Roxadustat is already approved in China and in Japan — where it is marketed as Evrenzo — for the treatment of anemia in patients with CKD, regardless of whether they require dialysis. Analysts consider the drug, which is being developed with San Francisco-based FibroGen Inc. and Tokyo-based Astellas Pharma Inc., a potential blockbuster drug due to the lack of innovation in anemia in CKD.

"A multitude of pipeline catalysts could support the shares, notably roxadustat US FDA approval by [year end] 2020 for anemia in chronic kidney disease, on which we are optimistic," said Jefferies' Peter Welford in a recent note to clients. Welford forecast 2021 sales in the U.S. and China alone of $213 million, with an estimated 80% chance of reaching peak sales of $1.8 billion.

"It's a great privilege to have participated in the scientific work that we were engaged in and to see it mature so nicely. We are grateful and proud that it led to a Nobel Prize but I remind the students that a lot of things go into winning prizes that you have no control over,” Kaelin said. "The real prize is knowing that you have the privilege of seeing and understanding something that was never understood before and solving that puzzle. And secondly, and more importantly, to see that patients are now actually benefiting from the discovery."