- Bluebird bio revealed Tuesday that the Food and Drug Administration wants more information about one of the biotech's gene therapies, and therefore an approval application set to be completed in the first half of the year will now likely come in the second half.
- The therapy, known as LentiGlobin, already gained approval in Europe to treat patients with beta-thalassemia, a rare genetic blood disorder, who require chronic blood transfusions. Bluebird wants the same approval in the U.S., but talks with the FDA about a type of test called release assays appear to be keeping the company from fully submitting its application.
- LentiGlobin faced delays prior to Tuesday's disclosure. Bluebird pushed back the therapy's European launch from 2019 to early 2020 because it was still working with regulators to finalize commercial manufacturing processes. While a slower timeline on a U.S. launch isn't ideal, analysts expect investors are more focused on other events — namely, data readouts for Bluebird's blood cancer drugs and the start of Phase 3 studies testing LentiGlobin as a treatment for sickle cell disease.
Bluebird's commercial operations are just getting off the ground. In its latest earnings report, the Cambridge, Massachusetts-based biotech detailed how it has inked agreements with health insurers in Germany that should provide coverage for LentiGlobin, which is sold under the brand name Zynteglo in Europe, for up to 50% of eligible beta-thalassemia patients. Bluebird expects the first commercial patient to be treated before July.
Across the Atlantic, U.S. patients are looking at a longer timeline before LentiGlobin becomes available. Stifel analysts wrote in a note to clients that they don't foresee any stateside patients receiving the therapy commercially in 2020 "given what we anticipate will be a complicated negotiation process with payors."
Analysts at Raymond James, meanwhile, downgraded Bluebird to a "Market Perform" rating, writing that "execution issues on the regulatory, clinical and manufacturing side outweigh our support for the innovative drug products."
As Bluebird works through the latest delay in beta-thalassemia, it will also be preparing for an expanded research program in sickle cell. The company already intended to kick off a late-stage study in sickle cell patients with a history of vaso-occlusive crises in the first half of 2020. With Tuesday's earnings presentation, though, came plans to initiate a second late-stage study sometime this year, which will evaluate LentiGlobin's effects in about 18 children with sickle cell and elevated stroke risk.
A sickle cell approval, though a ways off, could boost Bluebird's bottom line. Beta-thalassemia is rarer in the U.S. than other parts of the world, and certainly less common than sickle cell. According to estimates cited by the National Organization of Rare Disorders, roughly 3,300 U.S. patients have beta-thalassemia versus the 100,000 who have sickle cell.
An expanded program could provide more evidence of LentiGlobin's benefit in this larger patient pool. Yet the updates don't seem to have alleviated investor concerns. Bluebird shares were down nearly 10% late Wednesday morning, trading around $80 apiece.
"LentiGlobin in Sickle Cell Disease remains a bright spot, in our view, but with [late-stage studies] expected to get underway this year, we don't expect investor sentiment to change anytime soon," Stifel analysts wrote.
The investment bank models Zyntelgo bringing in $12 million worth of revenue in 2020 from the beta-thalassemia indication, increasing to $53 million in 2021 and $390 million by 2030. Conversely, it models $48 million in 2022 from the sickle cell indication, increasing to almost $2 billion by 2030.