60% RMS, 40% PPMS
Sales, first six months:
Why Ocrevus stands out:
First drug OK'd to treat both relapsing and primary progressive forms of multiple sclerosis
Biogen's Tecfidera, Novartis' Gilenya, Teva's Copaxone
Analysts expect blockbuster sales for Ocrevus, which looks set to become a cornerstone franchise for the Swiss pharma.
For an industry now infamous for steady price increases, Roche's decision to price its newly approved multiple sclerosis drug Ocrevus (ocrelizumab) 20% below the average list price of its competitors came as a surprise.
That Ocrevus was the first ever treatment approved to treat primary progressive multiple sclerosis (PPMS), a more advanced form of the condition, made the lower price all the more noteworthy.
In many industries, launching a new product in a crowded market often spurs companies to compete on price. Examples in biopharma, however, are less common — at least on a list price basis.
Yet, Roche's approach has paid off. Sales of Ocrevus totaled 500 million Swiss francs ($510 million) from launch through September 30, making the drug the best-performing new molecular entity to launch on the U.S. market this year.
Roche tries a different approach to pricing
The Swiss pharma believes it to be among the best launches in the MS space, which has seen other fast-growing treatments like Biogen Inc.'s Tecfidera (dimethyl fumarate) quickly reach blockbuster status.
"We've seen a consistent and strong volume of new infusions since approval, with more than 20,000 people treated with Ocrevus to date," said Kimberly Muscara, a senior manager of corporate relations at Roche's Genentech unit, in an emailed statement.
Like other MS drugs, Ocrevus targets CD-20 positive B-cells, thought to be responsible for nerve cell damage that leads to patient disability. Roche believes Ocrevus has shown competitive efficacy in the more common relapsing form of MS (RMS), while offering a better safety profile and more convenient dosing.
"The physician response has been tremendous," said Hideki Garren, group medical director at Genentech, in an interview. "We have seen a lot of excitement and enthusiasm for Ocrevus in the U.S. since approval."
That enthusiasm is highest in PPMS, which currently accounts for about 40% of the patients taking Ocrevus. Some of that demand is likely due to a buildup of patients who previously had no other treatment options, but continued growth looks likely.
Ocrevus has also performed well in RMS. About 70% of patients taking Ocrevus for RMS switched from other medicines, according to the company, cutting into the market share of established players like Biogen.
The physician response has been tremendous.—Hideki Garren, Group medical director, Genentech
A blockbuster trajectory
Analysts predict annual peak sales of Ocrevus in the multi-billion dollar range. Cowen & Co. equity analyst Steve Scala, for example, sees the drug eventually pulling in over $4 billion a year by the early 2020s.
Already, the drug has outperformed expectations and is already on a blockbuster trajectory. That will surely displace competitors, although the market has shown it can support several major product franchises.
Ocrevus to enter an already competitive market
"We expect Ocrevus will have a modest net negative impact on our MS portfolio," said Biogen CEO Michel Vounatsos, noting on a Oct. 22 conference call that the company has seen an uptick of discontinuations from patients taking its drug Tysabri (natalizumab).
Vounatsos doesn't see evidence of a sales "cliff" due to Ocrevus competition, however.
Other rivals have begun to see an impact as well, albeit to varying degrees. Bill Sibold, head of Sanofi Genzyme, recently said the French drugmaker had not been disproportionately affected from Ocrevus. Roughly 10% of all patients who have switched to Ocrevus were previously receiving Sanofi's Lemtrada (alemtuzumab) or Aubagio (teriflunomide), according to the company.
For Roche, Ocrevus is one of several new drugs that figure to be of increasing importance as the company’s top-earning biologics face increased biosimilar competition. Blockbuster success for Ocrevus would help ease any losses as those top brands see their growth slow.
Roche's launch of Ocrevus has smashed expectations, boding well for the drug's future in a crowded market. But entrenched rivals from Biogen, Novartis AG and others will likely stay competitive in the relapsing MS market.