ZOFRAN IS AIMED AT ANNUAL MARKET OF 2.5 MIL. SCRIPTS FOR CHEMOTHERAPY INDICATION, POST-OP INDICATION COULD BE MORE THAN THREE TIMES AS BIG IN U.S.

Glaxo's Zofran (ondansetron) will be aimed initially at a U.S. market of 2.5 mil. annual episodes of chemotherapy and radiotherapy emesis. The injectable anti-emetic is awaiting final FDA clearance and is likely to be Glaxo's next major product introduction. The product received a favorable advisory committee review in late May. The company says it still anticipates FDA approval by the end of the year, which would make the U.S. the twelfth market for the product. "Zofran has been launched in nine markets so far" and is pending launch in two other European countries, Glaxo Holdings Managing Director Franz Humer told a Dec. 3 meeting of securities analysts in New York City. "Two weeks ago, approval was given in Germany," he reported, and "a week ago we received approval in Holland. Launches in both countries are imminent." The world market for Zofran, Humer estimated, is about 7 mil. treatable episodes of chemotherapy emesis per year. The U.S. represents about 35-40% of that total. Maintaining that the product has "exceeded really all our expectations" in the first two major market launches in France and the U.K., Humer said if the company "can repeat" those successes, it will achieve "rapid penetration of the world market." Humer's estimates of Zofran's potential market are a refinement on earlier public statements by the company and portray a potentially larger field for the Glaxo launch. In January, Glaxo U.S. CEO Charles Sanders, MD, estimated the number of annual chemotherapy emesis patients at about 500,000, producing a total annual drug market of about $100 mil. Based on the more recent estimates by Humer, Glaxo by itself could carve out $100 mil. in annual sales by capturing only 30% of the number of treatable episodes in the U.S. Maintaining that the U.S. launch price for the product "has not yet been decided," Humer pointed out that the current U.K. cost for Zofran is between $120-$140 for one course of treatment. The number of courses of treatment varies with the type of chemotherapy and with the individual patient. At comparable prices to the British product, Zofran could reach about $100 mil. in first-year sales with one course of treatment for each of 715,000 episodes. "Zofran will undoubtedly be the gold standard for the treatment of emesis in cancer patients," Humer declared. "In all studies, Zofran has demonstrated to be significantly better than any other drug for complete or major control of emesis," the Glaxo exec contended. "In addition, Zofran has none of the side effects associated with products that are currently being used." The FDA advisory committee review of Zofran acknowledged the product's favorable side effect profile ("The Pink Sheet" May 28, p. 5). Beyond chemotherapy emesis, Glaxo is actively pursuing post-operative nausea and vomiting as another indication for Zofran. "This is a condition often appearing either in the recovery room or later when a patient returns after his operation," Humer observed. "In practice, anti-emetic therapy usually is prescribed as it occurs, but we believe there also exists a significant potential in prophylaxis," Humer said. The NDA filing is still planned for the second half of 1991. The company is studying an oral form of the drug as a followup to the I.V. The NDA for oral Zofran was filed with FDA in August. There are more than twice the number of treatable episodes of nausea and vomiting in the post-op area than in cancer, Humer noted. In 17 mil. operations worldwide, post-operative nausea and vomiting is a problem, Glaxo estimates. Almost half of those operations are performed in the U.S. During Q&A, Humer was asked about Zofran's position versus the SmithKline Beecham product under development, granisetron. Humer acknowledged that granisetron can be expected to have similar efficacy and "will be a competitor," but he maintained that the Glaxo product has a significant lead in terms of regulatory filings and approvals. "From what you've seen in the published literature," Humer said, "our clinical trials have been carried out with what we believe is a more rigorous and respected standard, namely the standard of the the Sloan-Kettering cancer researchers." Because of its early market position, Humer maintained that the Glaxo compound will "clearly be the established market leader." The second product into the field "will probably help to expand the market faster than take market share from it." He also noted that Zofran will have an oral formulation (the NDA was filed in August) and granisetron "does not have an oral formulation available." However, one potential advantage for granisetron is its once-daily dosing as compared to ondansetron's t.i.d. regimen. The Zofran potential highlights a two-edged challenge and opportunity for Glaxo in the coming years: the introduction of a series of premium priced new products into relatively mature categories. Glaxo's products offer the chance to expand the size of current markets dramatically, but they will have to compete against established lower-cost items in cost-conscious markets. Both the cancer emesis and post-op nausea markets, for example, were described by Humer as currently "low-priced." Audit data, he said, will show the markets at "about $140 mil. in cancer and $90 mil. for post-operative. "They are mature market[s] with no scientific progress over the last 10-20 years," Humer contended. To support the premium pricing, Glaxo is developing economic arguments to accompany its safety and efficacy data for the next generation of products. For Zofran, Humer noted, the cost of the drug will "probably not be more than 10% of the total costs of a cancer treatment." In previous discussions of the product's potential in post-op nausea, Glaxo has stressed the effect of Zofran treatment on getting patients out of the hospital and back to work more quickly. In the asthma field, where Glaxo already has a dominant position with 25% of the free-world market, the company is also on the verge of introducing new premium-priced products to rejuvenate its line. Glaxo is the "world leader in inhaled steroids" with 42% of the market from Ventolin and Beconase. Noting that those two products were introduced in 1969 and 1972, Humer added "they were also priced in 1969 and 1972." Because of the age of the products they "are undervalued as compared to other treatments which have been launched more recently." The beta 2-agonists, Humer pointed out, now represent 44% of treatment months of asthma therapy and only 29% of the market value of asthma therapy. To update its asthma line, Glaxo is counting on a new chronic asthma treatment Serevent (salmetrol) and a new topically active steroid prophylactic Flixotide (fluticasone propionate). Serevent, now being launched in the U.K. and ahead of schedule in the U.S., will be positioned as an "ideal, first-step maintenance therapy for long-term asthma control in all patient groups," Humer declared. He predicted that it will compete "with all other asthma treatments," including Ventolin. However, he added that albuterol may "continue to have a role as a rescue medication." The NDA filing is expected in the middle of 1991. The product had a fast seven-month regulatory review in the U.K. Serevent has anti-inflammatory and bronchodilator properties. "It is specifically designed to have a longer duration of action," Humer pointed out, noting that the length of action may be a key to justifying its premium price. "Serevent provides effective bronchodilation lasting 12 hours or more with a twice-daily dosage regimen of 50 mcg in mild to moderate asthma and 100 mcg in severe." Serevent "virtually abolishes nocturnal asthma, so the asthmatic can sleep through the night," the Glaxo exec said. "There is evidence from clinical trials that patients can lead more normal lives. In a number of our studies we are now quantifying the quality of life improvements." In the U.K. the product is priced to the wholesaler at about$50 for one month's standard treatment. During Q&A, Humer indicated that the price is about nine to 10 times U.K. albuterol prices. At $50 per month, it would be little less than two times the U.S. albuterol price. "We have done extensive economic studies, especially in the U.K.," Humer said. "The costs of asthma per patient for one month is between (British Pound)100 and (British Pound)130 to the economy. That compares to a (British Pound)20 price for Serevent." Taking the cost comparison to a different level, Humer declared that the "daily cost of Serevent is around $2 compared to a pack of Marlboros around $4." Asked about the use of Serevent in children, Humer responded that the initial labeling in the U.K. does not contain pediatric usage because the first filings were required to have "a lot of adult data." The registrations for pediatric use will be ready overseas and in the U.S. by the middle of 1991, Humer assured the analysts. Humer's presentation was designed to identify current and short-term commercial markets for Glaxo. He did not refer to Volmax in the U.S. as an extension of the albuterol position. That may indicate that the company is looking beyond the Alza extended-release formulation to the newer compound, salmeterol, to bolster its asthma position. The Imitrex (sumatriptan) anti-migraine project will take Glaxo into an uncharted market, Humer said. Despite a large patient population, "more than twice the number of individuals experiencing asthma," Humer said, the migraine market is suffering the "Cinderella syndrome" -- a lower level of awareness and interest by physicians. "The extent of the problem is not reflected in the current market" of $300 mil.-$350 mil., Humer maintained. "In a number of ways," Humer said, the migraine market reminds him of the ulcer market before H[2] blockers were introduced in 1976-1977. Recent Glaxo market research in "major countries around the world" shows that migraines are experienced by about 12% of the population. About two-thirds of the migraine sufferers (63%) are women, predominantly in the age group 30-45. The average patient suffers 12 attacks per year, "but there is a group of sufferers that have a significantly higher incidence of frequency of attacks." Humer estimated that about 20% of migraine sufferers (or 2% of the general population) experience about 50% of the attacks. Glaxo estimated the current number of migraines at 1.4 bil. per year. Glaxo is apparently preparing for an aggressive promotional effort in the migraine field, probably including consumer educational programs. Humer pointed out that "only 30% of sufferers currently consult a physician." Half of the migraineurs have given up seeing a doctor, Glaxo found. "Obviously," Humer declared, "high priority is being given to education programs for both migraine sufferers and physicians." The once-a-month average frequency of the attacks may accommodate a high per-dosage price for Imitrex. Christine Heuer (Smith Barney) asked if a $10 a dose price could be charged, if the product was to be used infrequently. Humer noted that the frequency of administration is one of the issues being considered and said he would "not dissuade" the analyst's calculations. Again, stressing a cost effectiveness background for the new product, Humer estimated that the minimum cost of lost labor days in the U.S. is approximately $5-$7 bil. annually based on assumptions of 250 mil. days of work lost. Humer acknowledged that the "pricing of Imitrex/Imigran is quite a complex issue. That is why we have carried out the significant cost-benefit studies, the quality of life studies." In a recent, unpublished study, Glaxo surveyed 900 migraine sufferers and tabulated responses from two-thirds of those surveyed. During a four-week period, over half (55%) of the respondents said they had missed at least 2.5 days of work due to migraines and 88% said they had worked more than one week while suffering migraine symptoms. Glaxo extrapolated those figures to calculate a lost labor cost for each worker between $2,800 and $3,000. Adding in ancillary costs to employers, a per worker range of lost labor costs expands to $3,600-$6,800 per year. Humer noted that the subcutaneous product for self-administration will be introduced with an Owen-Mumford device. That device has undergone "extensive consumer research," Humer said, "and we've not seen any resistance and interestingly enough in a number of the trials the efficacy rates using the self-injected devices were higher than when the doctor was injecting." Within a year, the company hopes to have a self-administration device that will be about the size of a cigar tube, Humer said. The firm is also working on oral, intranasal and suppository forms of the drug. The NDA for the intranasal will be filed in the first half of 1992, Humer said. Glaxo intends to file the NDA for the oral form before Christmas. Humer noted in response to a question that the firm is also beginning to look at Imitrex for tension headaches -- a condition with a higher incidence of 2 bil. headaches per year.