Johnson & Johnson Takes Aim at AbbVie
Johnson & Johnson (NYSE: JNJ) just submitted an application for FDA approval of guselkumab, a next-generation therapy that if approved, will compete head-to-head against AbbVie Inc.'s (NYSE: ABBV) megablockbuster autoimmune-disease drug Humira. Since Humira is the world's best-selling drug, and guselkumab could have billion-dollar blockbuster potential, let's learn some more about it.
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Taking on the champion
Humira, an anti-TNF biologic (it blocks tumor necrosis factor, or TNF), is the king of all prescription medicines in the United States. It's approved to treat a wide swath of autoimmune diseases, including plaque psoriasis, and widespread adoption of the drug has propelled its annual sales to more than $14 billion.
Humira's standing as the dominant therapy in autoimmune indications, however, may be about to end. Humira's patents are beginning to expire, and competitors eager to win away Humira's sales are working nonstop to develop Humira-beating treatments.
Johnson & Johnson has been at the forefront of those efforts. The company already markets the $3-billion-plus-per-year psoriasis drug Stelara, and its latest drug, guselkumab, could win away even more of Humira's market share in the indication over time.
In trials, more patients who were treated with guselkumab achieved clearer skin than did patients who were treated with placebo or Humira.
Specifically, J&J's VOYAGE 1 study showed that nearly three-quarters of patients receiving guselkumab achieved PASI 90 (on the Psoriasis Area and Severity Index), or a 90% improvement in skin clearance from baseline. Only 2.9% of patients who received placebo could make that claim.
More importantly, 73.3% of guselkumab patients achieved PASI 90 at week 16, compared to 49.7 % of patients who were treated with Humira. At week 24, 80% of guselkumab patients achieved PASI 90 versus 53% of Humira patients. Guselkumab's outperformance continued through week 48, when the study ended.
Guselkumab's trial results suggest a clear benefit for patients, and since guselkumab's safety was similar to Humira's, there's little reason to doubt that J&J's seasoned sales team will be able to get this drug in front of doctors, or that doctors will prescribe it.
Shifting share
The market for psoriasis drugs is undeniably massive: It's estimated that 7.5 million people suffer from the condition in the U.S. alone. It also affects 14 million Europeans, and globally, the psoriasis patient population could be as large as 125 million people.
Not all of these patients will seek treatment, and psoriasis signs and symptoms vary from person to person, but the itching, burning, and soreness associated with moderate to severe psoriasis has made this market incredibly valuable to drugmakers. GlobalData estimates that the market for psoriasis drugs already exceeds $6 billion and that by 2024, the market could be worth more than $13 billion.
Competition for those sales is fierce, and getting more so every year. J&J's Stelara has been used to treat psoriasis since 2009, and in the third quarter, Stelara's global sales clocked in at $814 million, up 32.8% from a year ago. More recently, the FDA granted a green light to Novartis' Cosentyx in 2015. Cosentyx, an interleukin-17A inhibitor, is already generating annualized sales of $1.2 billion. Celgene entered the psoriasis market last year as well, and its Otezla delivered third-quarter annualized sales that put it on pace to be a billion-dollar blockbuster too.
Given how many psoriasis drugs have eclipsed the 10-figure revenue threshold, it's not shocking that industry watchers expect guselkumab's peak sales will also eventually exceed $1 billion. Of course, guselkumab needs to win FDA approval first, but it doesn't appear there are any safety reasons that could derail that from happening. If that's the case, then a decision could be on tap in the second half of next year.
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