If you think that Tyrosine Kinase is a reference to the “A Roshanda by Any Other Name” chapter in Freakonomics or that T315I is a rapper from Atlanta, stop reading. If you have any clue what I'm talking about, please continue.
Ariad Pharmaceuticals suspended sales and marketing of Iclusig (ponatinib) after an FDA review prompted safety concerns because of the risk of life-threatening blood clots and severe narrowing of blood vessels. The FDA cited their concern that 24 percent of patients using Iclusig in a mid-stage clinical trial experienced heart attacks, strokes and other serious vascular events. They also noted that 67 percent of patients in clinical trials experienced high and 8 percent had heart failure, including fatalities. According to the CDC the age adjusted prevalence of hypertension in Americans is between 25-39%, depending on what state you live in (shame on you Bible Belt; your heart and your bible are both thumping). A 38-42% uptick in hypertension certainly seems substantial, and I could understand why the FDA would be concerned about CML patients without the T315I, but I have to wonder whether or not I'd care about that increased risk if I were a CML patient with the T315I mutation. Actually I don't have to wonder because I know that I probably would not care so much about that increased risk, nor would my doctor, because I really wouldn't have many other choices.
Sure, all the talk about the potential health risks sound scary and the FDA asked Ariad to temporarily suspend marketing and sales of Iclusig, but the drug will be back. After the termination of the EPIC trial, it will be back on a more limited scale than what everyone was hoping for 2 months ago, but not in the "break glass in case of emergency" role it has been recently characterized as destined to become.
If you look at the recently updated Clinical Practice Guidelines (version 1.2014) released in September of this year The National Cancer Comprehensive Network actually gave mutation specific therapeutic recommendations for CML. Ponatinib is by far the most effective therapy for CML patients harboring the T315I mutation. Within those same recommendations, the NCCN specificially discusses management strategies for ponatinib associated toxicity. Like the original FDA approval, the NCCN warns against the risks of severe thrombotic events as well as hepatotoxicity. In the patients that develop some of these severe toxicities, the NCCN recommends dose modification, dose interruption or discontinuation as the appropriate next steps.
At the crux of it is a simple calculus: even though reduced intensity conditioning regimens for stem cell transplant candidates reduces treatment related mortality, 20-30% of patients still die from conditioning and following that conditioning regimen, three year survival rates for patients post-transplant are a little better than 70%. So we go from 100 to 80 and then 80 to 56, and that is with a lot of drugs and grueling hospital stays.
In the vacuum of not having clinical trial data that demonstrates that the risks associated with Iclusig are preventable by concomitant administration of some other drug like aspirin, Pradaxa etc., and assuming that 24% of patients will invariably suffer some serious event, patients on Iclusig will still have better survival outcomes and a higher quality of life than the alternative treatment routes for T315I patients. Aside from treating patients with another drug to manage their cardiovascular risk, there are a couple of very easy methods, like dose reduction and patient selection that permit successful toxicity management. For instance if a patient is not responding to Iclusig, why continue to expose them to increased risk of an adverse event if they aren't receiving any clinical benefit. I think that the FDA will come to the same conclusion and will make the same recommendation that physicians are already following. Additionally treating hematologists will work with their cardiologists to optimize management of cardiovascular risk in Iclusig receiving patients. If you completely restrict Iclusig to T315I patients receiving salvage therapy, there is at least 5000-14000 patients right now that would benefit from the drug, with that number growing by at least 500 patients annually. Sure, it isn't as large a market as the global CML market (~80,000) they were shooting for, but it is a substantial market with a proven benefit in an otherwise fatal indication.
With Ariad's Section 382 Rights Agreement made on Halloween, you have to wonder who else is buying. Granted Ariad has had a lot on their plate since October 21st, but it is doubtful it took them 10 days to enact their poison pill, so I am doubtful it is a response to Camber or Sarissa. Some other shark is out there circling because Ariad is way oversold and they know it. It is crazy that at current levels you could buy the company for $500M, completely unwind the EPIC trial, and still have $300M in cash on the books. Even if they burn through $100M getting Iclusig back on track, after doing so they could easily sell $125M in the T315I market annually. Ponatinib's patent protection doesn't run out for another 13 years and the real estate this drug represents is just way to valuable to raze. It's getting treated like the Detroit of CML drugs, when in reality it is more like Kansas City. I don't want to live in either, but my chances of surviving KC are a hell of a lot better.
Of course this all hinges on the FDA allowing Iclusig to return to the market. I think that is even more likely following the EMA's Pharmacovigilance Risk Assessment Committee decision last week to keep ponatinib on the market, but with a warning about potential cardiovascular adverse effects. I think that the PRACs recommendation makes it all the more likely that the EMA's CHMP will approve Iclusig before year end. Stateside, I doubt the FDA won't allow it to return though because if the FDA does not allow Ariad to resume marketing and sales of Iclusig specifically for T315I CML patients, they are effectively sentencing the majority of them to succumb to their disease over the concern that 24% of these patients may succumb to something other than their leukemia. That is why I think both Ariad and T315I CML patients have longer lives ahead of them than it may currently appear.
For the T315I patients that would come off of ponatinib if the drug disappeared forever, they really don’t have any meaningful fallbacks; they’ll either go on omacetaxine (aka Synribo) which may buy them another 9 months or they'll go to transplant. Those options are better than nothing, but when you compare that to the long term efficacy observed with Iclusig you see why the NCCN prefers ponatinib (hair and all). That is because as of June 2013 the median duration of response in a study of Iclusing patients had not yet been reached although the median follow up time was three years.
You also have to keep in mind the way the NCCN works too. This is not some ivory tower of hematologists futzing around town on their honorariums deciding what drugs live and die by their recommendations. These are committed clinician/scientists that see patients in their clinical practice and are experts in their field. They use the experience gained in their own clinics to formulate the treatment algorithms and recommendations they put forth. So when they said on September 9th, 2013(one month before the clinical trial suspension) that ponatinib is their preferred treatment for T315I CML patients, they made that recommendation knowing full well they had likely seen thrombotic events and other complications in their own clinics and the clinics of their colleagues. Yet, they made those recommendations knowing full well that their patients stood a much better chance with Iclusig and it's risks than they did with Synribo or stem cell transplant. We can put on our actuarial hats and compare Iclusig (with all it's risks) to the alternatives available if we have to, but NCCN has already done that for us.
The FDA's recommendation isn't just bad for patients, it's bad for shareholders. Unfortunately for many shareholders, Ariad has experienced thrombotic events of it's own over the past month. There has been some savvy buying along the way though too. On October 21, both Camber and Sarissa, acquired positions over 5%. Sarissa filed a 13D disclosing a 6.22% interest while Camber filed a 13G with a 5.4% stake. They probably both built toeholds during October 9th's collapse, adding to the position as it continued to trade down on worse news. With Ariad's recent collapse and shares trading as low as $2.15 the two funds were probably none too pleased and there was certainly hypertension in Boston and Greenwich. Hard to know without seeing the trades, but suffice it to say they were down anywhere at least 18% and could have been down as much as 118% on those positions during the harrowing Halloween lows. Even with Ariad's 12% move off its lows, they are probably still very unhappy with their marks. More recently, Fido filed a SC 13G/A on November 8th disclosing it had ramped up to a 14.8% position in Ariad with over 27M shares. It may have been difficult for Sarissa and Camber to add anymore to their position as it was already an 11% and 4% position for them respectively, but I hope for their sake they did because I think Ariad is one of the most compelling investment prospects in Oncology right now. The FDA's recent antics tied up Iclusig and threw it the water see if it was a witch. Hearkening back to Levitt and Dubner's book:
Which is more dangerous: a gun or a swimming pool?The FDA better not throw T315I patients into the deep end. They may have hog tied Ariad and thrown them in the water, but its the patients that will drown if the FDA does not bring back Iclusig.