Novartis set to ride Entresto wave, says report
- Even though Novartis’ heart drug Entresto (sacubitril/valsartan) got off to a slow start, the launch has accelerated significantly, said Jefferies analyst Jeffrey Holford, who expects the upswing to continue.
- While consensus estimates for the drug show no growth in 2017, Holford pointed to significant drivers that could change the launch curve of the drug.
- In late-April, Novartis reported sales of $84 million for Entresto in the first quarter, revenue growth of $67 million from a year ago.
Heart-failure drug Entresto has been a major disappointment to the big pharma. The drug was expected to be an uber-blockbuster once it hit the market in 2015, but the trajectory of the launch has been sluggish due to barriers to patient access with payers and an initially underfunded launch.
Novartis has since thrown money behind the drug and has been working diligently to negotiate with payers to improve access. Even so, 2016 sales totaled only $170 million, well short of the $200 million Novartis had forecast.
The Swiss pharma hopes its investments and favorable treatment guideline recommendations will push uptake higher this year.
"Two-thirds of these sales are coming from the U.S., and you can see that we're starting to see a bit of an acceleration in new-to-brand scripts. We were getting about 1,800 per week at the end of the fourth quarter, we're now at over 2,000, and we expect this to continue to translate to increasing total scripts as we move throughout the year," said CEO Joe Jimenez on pharma’s first quarter call in April.
While the drug is still not at a blockbuster pace, first quarter sales show Entresto’s launch could be accelerating. The company said on its call that Medicare access was previously 25% with no prior authorization, but has grown to 33% over the quarter.
Jefferies analyst Holford believes that’s the case and thinks Novartis will see a bump to revenues. He now models Entresto to hit revenues of $4.7 billion by 2021, compared with consensus estimates of $3.1 billion for that time period.
"We have already seen one round of acceleration of the Entresto launch in 2016 on the back of the better-than-expected timing and wording of US and European treatment guidelines in May 2016," wrote Holford in a note to clients.
"We believe that this second wave of acceleration will continue for a long time as payer hurdles continue to fall and enthusiasm builds among cardiologists."
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