Celgene MS drug clears key trial, but disability data falls short

By Divya Grover

(Reuters) - Celgene Corp's multiple sclerosis drug met the main goal of reducing annualized relapse rate, compared with Biogen Inc's Avonex, in a second late-stage trial, but failed to outperform Avonex in slowing disability progression rate.

Celgene's shares fell as much as 2.8 percent to $113.63 in morning trading on Monday as investors focused on the disability data.

The drug, ozanimod, was shown to be superior to Avonex in reducing annualized relapse rate in patients with relapsing multiple sclerosis (RMS) in another late-stage study in February.

However, Celgene said on Monday a combined analysis of the two trials did not show ozanimod had a statistically significant benefit over Avonex in slowing disability progression.

The company highlighted that overall the rate of disability progression was very low in the trials.

Analysts did not read much into the data on disability progression, with Barclays calling it "only wrinkle" in the otherwise successful trials.

With prior results suggesting a best-in-class profile, with Gilenya-like efficacy and absent heart rate effects, ozanimod has the advantage of a shorter half-life, a favorable feature highlighted by experts in terms of safety, Wells Fargo's Jim Birchenough said.

Gilenya is a rival MS drug from Novartis AG.

Ozanimod's adoption will depend on whether Gilenya goes generic in 2019, which may coincide with ozanimod's launch, Evercore ISI analyst Umer Raffat said.

Ozanimod is expected to generate about $2 billion by 2022, according to Clarivate Analytics.

Celgene, which gained access to ozanimod through its $7.2 billion acquisition of Receptos Inc in 2015, said it would file a U.S. marketing application for the drug by the end of the year.

RMS is characterized by clearly defined attacks of worsening neurologic function.

These attacks - often called relapses, flare-ups or exacerbations - are followed by partial or complete recovery periods during which symptoms improve partially or completely.

Multiple sclerosis affects about 400,000 people in the United States and about 2.5 million people worldwide. About 85 percent are diagnosed with RMS, according to the company.

The most popular MS treatment in the United States currently is Teva Pharmaceuticals Industries Ltd's Copaxone, which generated sales of about $4.22 billion in 2016.

Celgene is also testing Ozanimod in ulcerative colitis and Crohn's disease.

Up to Friday's close, Celgene had gained 17 percent in the past 12 months, outperforming the 9.6 percent rise in the Nasdaq Biotechnology Index during the same period.

(Reporting by Divya Grover in Bengaluru; Editing by Sriraj Kalluvila)