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Alkermes’ comeback bid boosted by FDA panel backing for schizophrenia drug

  • A Food and Drug Administration advisory panel on Friday voted in favor of an experimental drug Alkermes developed for schizophrenia and bipolar disorder, making it more likely the agency will approve the treatment before a decision deadline next month.
  • A majority of committee members concluded Alkermes’ drug, called ALKS 3831, is effective at mitigating the weight gain associated with the antipsychotic Zyprexa, which was what the company hoped to prove through clinical testing.
  • Experts also supported the drug’s safety data and Alkermes’ proposed label, though some suggested a risk-management program might be needed. While an approval now seems in reach for ALKS 3831, its commercial prospects are less certain. One Wall Street analyst, for instance, expects the drug to be limited to patients taking Zyprexa who are deemed likely to gain more weight.

Alkermes has badly needed a win since 2018, when an FDA panel panned what was once a promising depression drug called ALKS 5461. Alkermes stock had climbed near all-time highs due to the program’s early progress, but, in the aftermath of the hearing and the drug’s subsequent rejection, shares subsequently crashed to levels not seen since 2012. A restructuring followed.

But Alkermes, which has for years sought to transform itself from a drug delivery specialist to a maker of novel medicines, stuck to its plan. That persistence may soon pay off with an approval for ALKS 3831, though the company would still have hurdles to overcome for the drug to be a success.

ALKS 3831 is meant to lessen the weight gain typically seen with use of Zyprexa, a medicine for schizophrenia or bipolar disorder. Alkermes’ drug combines Zyprexa with a second compound, samidorphan, that is supposed to lower the drug’s effects on weight by blocking certain opioid receptors in the brain.

Alkermes is aiming for approvals in both schizophrenia and bipolar I disorder. The company’s best evidence comes via a six-month trial in which ALKS 3831 bested Zyprexa on measures of weight gain, albeit at a level analysts described as modest.

Unlike with ALKS 5461, Alkermes appears to have convinced regulatory staff and outside experts of the drug’s worth. Before the hearing, the FDA filed briefing documents that analysts deemed “benign,” and the company secured positive votes from committee experts on multiple discussion topics. Sixteen of 17 panelists felt Alkermes adequately proved ALKS 3831 mitigates Zyprexa-associated weight gain.

“On the back of ‘Yes’ votes across the board, it seems very likely that ALKS3831 will be approved,” wrote Stifel analyst Paul Matteis.

But a key issue brought forth at the advisory panel — how the drug affects people already taking opioids — could provide insight into some of the commercial challenges Alkermes will face should ALKS 3831 be cleared for use by the FDA’s Nov. 15 deadline.

Because ALKS 3831 blocks opioid receptors, treatment might induce withdrawal symptoms for people already on opioid drugs, or tamp down the drugs’ pain-relieving effects, which could in turn lead someone to accidentally overdose. Though Alkermes excluded patients using opioids from clinical testing, researchers still observed one instance of each case, an issue highlighted by FDA scientists and discussed at the hearing.

Multiple experts at the panel noted the safety profile of ALKS 3831 in combination with opioids isn’t totally clear, either, Matteis wrote. Roughly a fifth of Zyprexa users also take opioids, FDA staff noted in its briefing documents.

Alkermes has proposed a label explaining the drug shouldn’t be used in patients who are either dependent on opioids or chronically use them. While a majority of panelists agreed the label was sufficient, many expressed concern that more significant preventive steps might be needed.

Multiple panelists also questioned whether Alkermes had generated enough data to justify an approval in bipolar I disorder.

All of which raises questions about how ALKS 3831 will be used. It’s unclear, for instance, whether the FDA will approve ALKS 3831 for both diseases, accept Alkermes’ proposed label or require a safety warning on ALKS 3831.

“Our issue remains our expectation for limited commercial success and peak sales of [roughly] $300 [million],” wrote SVB Leerink analyst Marc Goodman. Evercore ISI analyst Umer Raffat added the expects the drug’s use to be limited to “high weight gainers on olanzapine.”

Raffat, nonetheless, noted the advisory panel vote is “finally a bit of good news at Alkermes after quite some time.”

Alkermes shares initially jumped about 15% in pre-market trading before settling in to trade roughly 4% higher Monday morning.

Beyond ALKS 3831, the company’s only other drug in human testing is a cancer treatment in Phase 2 trials. Early results were disclosed at a medical meeting in September.