Risks abound as drugmakers go where others flopped

A researcher works at the Cytos laboratory in Schlieren near Zurich, May 24, 2005.

NEW YORK (Reuters) - Pharmaceutical companies are forging ahead with expensive clinical studies for experimental medicines despite previous failures for other drugs that work in a similar way.

These efforts appear more of a risk than typical late-stage research projects. But they also address major therapeutic areas -- such as heart disease and diabetes -- that could yield significant medical advances and blockbuster sales, should they succeed.

The latest example came last week when Roche Holding AG (ROG.VX) announced plans to move into Phase 3 its drug to prevent heart problems faced by diabetics.

Roche's drug, aleglitazar, follows a well-trod but thus far unsuccessful path. AstraZeneca Plc (AZN.L) scrapped development of one such drug in late-stage development in 2006, the same year Bristol-Myers Squibb (BMY.N) ended development of another after regulatory setbacks.

Roche and Merck & Co (MRK.N) are also pursuing novel medicines designed to raise good cholesterol -- despite a clinical flameout by a Pfizer Inc (PFE.N) drug in the same class that raised the risk of death.

"I definitely would classify that as a gamble," said Donny Wong, director of metabolic disorders research at market research firm Decision Resources.

Still, Wong said, these drugs have "multibillion-dollar potential."

"They're still going after the blockbuster model, essentially," Wong said.

Smaller drug companies are also developing medicines in categories despite their forerunners' major failures.

For example, MannKind Corp (MNKD.O) is seeking U.S. approval for its inhaled insulin even though Pfizer's version was a commercial flop and Eli Lilly (LLY.N) and Novo Nordisk (NOVOb.CO) canceled development of theirs.

Even if these follow-up drugs prove successful in large studies, they may face commercial and regulatory hurdles in overcoming negative associations with the class left by the initial failures.

To some, drugmakers' willingness to push forth with projects despite setbacks of similar drugs underscores the lack of innovation.

"Industry-wide, the pipelines still are really limited," said Jon LeCroy, a pharmaceutical analyst with Natixis Bleichroeder. "If you don't have other things to put your money into, you have to go after these higher-risk programs."

CLASS EFFECT OR NOT?

In the case of aleglitazar, however, Roche believes it has taken steps to reduce the possibility its product is afflicted with problems of past medicines in the class -- and worth the investment in a 6,000-patient Phase 3 trial to assess cardiac events.

The drugs are designed to turn on two protein receptors known as PPARs, one that regulates glucose and another lipids. These dual PPAR drugs have long tantalized researchers as a potential way to help diabetics address multiple targets linked to heart disease.

Luke Miels, Roche's head of strategic marketing for metabolic diseases, said the company conducted a renal safety study to ensure its product was free of the kidney problems that undermined Astra's tesaglitazar.

Roche is using a relatively low dose of its aleglitazar, Miels said, which could eliminate the side effects linked to Bristol's muraglitazar.

"We definitely have the questions of the other companies," Miels said, "But what we've seen with our compound is it does have a different profile."

Miels, who expects the Phase 3 study to be completed in 2013, calls aleglitazar a "medium-level risk program."

"Often people will say it's a class effect; they're all the same in the class," Miels said. "But I think chemistry and science keep teaching us that these drugs are different. They may be subtly different, or there may be significant differences, just by changes in the chemical structure."

An editorial in the Lancet medical journal this month that commented on mid-stage results of aleglitazar said "research in this difficult area must be encouraged."

"The coming years will tell whether hopes raised by the (aleglitazar study) are confirmed by appropriate long-term clinical trials," the editorial said.

Merck is also moving ahead with a 1,500-patient study of its drug, part of the CETP inhibitor class of drugs designed to raise good HDL cholesterol.

Merck's anacetrapib showed in earlier studies it did not raise blood pressure and cause other worrisome signals found with torcetrapib, which Pfizer discontinued in 2006 for safety reasons in one of the largest research disappointments in the industry's history.

Given torcetrapib's failure, Morningstar analyst Damien Conover gives anacetrapib a 20 percent chance of making it to the market, compared to about 60 percent for drugs generally at this stage of development.

But Dr. Ray Gibbons, a cardiologist at the Mayo Clinic and former president of the American Heart Association, said more than one drug will need to be tested to determine whether problems seen with torcetrapib plague the whole class.

"I don't think in general that the scientific world feels that we should close the door on the development of drugs in that class on the basis of one high-profile failure," Gibbons said. "That's the challenge: We don't know."