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How big is Novartis’ LCZ696 heart drug? Experts bet on a key number

In the pharma business, you’re only as good as your next big blockbuster. And in Novartis’ ($NVS) case, the next big cardio blockbuster–LCZ696–looks very good, indeed.

The key number on the heart drug’s ability to reduce mortality risks for patients, though, is still under lock and key for the next few weeks. But Reuters‘ Ben Hirschler has been tracking the betting among groups of physician experts polled by some high-profile analysts. Heart experts polled by Cowen came up with a bet on a 23% reduction in the risk of cardio death for the patients in the study, which was stopped early on stellar but unspecified results. And at Deutsche Bank the poll of cardiologists concluded that 15% or better would be “highly relevant,” according to Hirschler, with a number north of 20% expanding the potential patient pool for Novartis.

Analysts at Leerink said back in April that the number had to be more than 20% to hit the p value laid out in the study, which should be good enough to win a market worth billions of dollars in annual sales. And Reuters notes that Morgan Stanley has taken the bear position with a risk reduction of about 30% needed to persuade physicians to widely prescribe a drug likely to cost around $2,000 to $2,500 a year.

Once considered a marginal, high-risk program, LCZ696–an angiotensin receptor neprilysin inhibitor (ARNi) bidding for first-in-class status–almost overnight became one of the top late-stage drugs in the industry’s pipeline. Up until a few months ago, the company’s cardio spotlight was reserved for serelaxin, a top prospect that has since dwindled to a side show as the data soured and regulators turned cold. Generic competition for the Diovan franchise, meanwhile, has arrived with a vengeance, roiling the numbers at the pharma giant as it restructures in a major asset swap with GlaxoSmithKline ($GSK). And with serelaxin out of the running, LCZ696 has assumed an outsized role at Novartis as analysts assess its potential for a quick recovery.

And that potential is now all about the number. Without a solid figure to rely on, projections on peak sales tend to run the gamut, from the company’s own bullish $2 billion to $5 billion to Deutsche’s awestruck $10 billion top. EvaluatePharma pegged nearer-term 2020 sales at a much more modest $1.3 billion.

The drug itself is a combination of two hypertension therapies, valsartan and AHU-377. Valsartan spurs vasodilation to flush sodium and water through the kidneys while AHU-377 is designed to block an enzyme that threatens a pair of blood-pressure lowering peptides. The FDA has a very high standard for heart drugs intended for a mass market. The question now is just how big Novartis’ market-defining number may be.

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