* Twice daily BG-12 dose cut relapse rate 44 pct
* Cut relapse rate 51 pct given three times daily
* Teva's Copaxone cut relapse rate 29 pct
* Biogen shares up more than 10 percent
By Toni Clarke
Oct 26 (Reuters) - Biogen Idec Inc's experimental drug BG-12 may be poised to become the world's leading treatment for multiple sclerosis, based on data from a late-stage clinical trial released on Wednesday, experts say.
The closely watched trial, known as CONFIRM, showed that BG-12, when given twice a day, cut the annualized relapse rate in patients with multiple sclerosis by 44 percent at two years compared with a placebo. When given three times a day, it cut the relapse rate by 51 percent.
Biogen's shares were up more than 10 percent as investors bet the drug will, if approved, take share from existing front-line therapies, including market-leader Copaxone, which is made by Teva Pharmaceutical Industries Ltd .
"It looks like BG-12 is the best drug," said Eric Schmidt, an analyst at Cowen and Co, who predicts peak annual sales of about $3 billion. "There are still some things we don't know about its long-term safety, but I think it's possible BG-12 will be the biggest MS treatment in the future."
Multiple sclerosis is a chronic, often disabling disease that attacks the central nervous system and can lead to numbness, paralysis and loss of vision.
The global market for multiple sclerosis is currently worth about $12 billion, he said. About 2.5 million people are estimated to have the disease worldwide.
Approval of BG-12, a pill, would consolidate Biogen's position as the dominant force in multiple sclerosis. The company already sells Avonex, which is given by injection, and Tysabri, which is infused. Sales of Tysabri, widely considered to be the most effective drug on the market, have been hurt due to the drug's link with a potentially deadly brain disorder known as progressive multifocal leukoencephalopathy, or PML.
BG-12's competitive advantage may lie in its safety profile, which looks relatively clean based on two-year data, analysts said. The most common side effects in the CONFIRM trial, as well as an earlier trial known as DEFINE, were flushing and gastrointestinal disturbances.
That could give it an advantage over Novartis AG's recently launched drug Gilenya, the first oral MS drug to reach the market.
"There is a lot of burdensome monitoring that has to be done with Gilenya, so I think BG-12 will be a much more practical solution," said Bret Holley, an analyst at Oppenheimer & Co.
Still, Christopher Raymond, an analyst at Robert W. Baird, said in a research note that while CONFIRM means BG-12 will likely be approved, "we continue to worry that the launch could disappoint more bullish revenue projections."
He said Gilenya has seen rapid adoption since launch and he believes a favorable BG-12 launch is already priced into Biogen's stock.
FROM CHEAP VALUE TO FAST GROWTH
Biogen's shares have more than doubled since hitting a year low last October of $58.30, helped by a restructuring program and optimism over BG-12.
The company's recovery has been dramatic. For several years it fought proxy battles against activist investor Carl Icahn, who recently sold most of his stake in Biogen.
"It's gone from a very cheap unloved value play to perhaps the cleanest large cap growth story in all of healthcare," said Schmidt.
BG-12 is designed to treat relapsing-remitting MS, in which flare-ups are followed by periods of remission. About 85 percent of people with MS are initially diagnosed with this form of the disease.
Doug Williams, Biogen's head of research and development, said on a conference call that the profile of BG-12 gives it a strong chance of being used in newly diagnosed patients.
"The risk-benefit profile of BG-12 is quite attractive," he said. "It looks like a first-line therapy to me."
Investors had been waiting to see if the data would be comparable to DEFINE, which posted unexpectedly strong results showing BG-12 cut the annualized relapse rate by 53 percent when given twice a day. The results of the two trials were sufficiently similar to be considered positive.
The CONFIRM study, unlike DEFINE, tested BG-12 against Teva's Copaxone. Copaxone cut the annualized relapse rate by 29 percent.
Biogen said that in CONFIRM, BG-12 also cut the rate of disability progression by 21 percent when given twice a day and by 24 percent given three times a day. That result was not statistically significant and compares negatively with the DEFINE trial, which showed a cut in the rate of disability progression of 38 percent.
Biogen said the lack of statistical significance may be due to an unexpectedly low rate of disease progression in the placebo group. It said it is studying the data closely to better understand the figures.
Copaxone cut the rate of disability progression 7 percent.
Analysts said the data, which will be presented in more detail at a future medical meeting, look strong.
"We believe these data generally "confirm" BG-12's efficacy and clearly show that it's likely a more effective drug than Teva's Copaxone," Mark Schoenebaum, an analyst at ISI Group, said in a research note. Schoenebaum estimates BG-12 could generate peak sales of $4 billion.
Williams said the company expects to file for approval of the drug in the first half of next year.
Biogen's shares were up 10.5 percent to $118.13 in afternoon trading on Nasdaq. Earlier in the day the stock rose to a year high of $119.75.