FDA panel on anemia drugs has investors wary

By Deena Beasley - Analysis

LOS ANGELES (Reuters) - A U.S. Food and Drug Administration advisory panel may call on Thursday for further restrictions on the use of anemia drugs in cancer patients, leading some investors to expect lower sales for Amgen Inc's (AMGN.O) top-selling Aranesp.

Amgen shares have fallen about 20 percent since early December, largely over the risk of usage limits, and analysts say there is a chance the panel could take more drastic action and recommend anemia drugs not be used at all by many cancer patients.

"Most investors are not expecting this to go well," said Eric Snyder, an analyst at Mehta Partners.

At a minimum, the panel of outside experts is expected to ask for a large-scale study to definitively measure safety.

The FDA a year ago put its strongest "black box" warning on the labels of Aranesp, as well as Amgen's Epogen and Johnson & Johnson's (JNJ.N) Procrit, after studies showed a higher risk of death for some patients.

The agency last week updated the warning to include information about studies showing that the drugs shortened survival for some cancer patients.

Over the past year, there has been a steady drumbeat of negative news about the drugs, which are genetically engineered versions of a protein that boosts production of oxygen-carrying red blood cells.

Concerns that the anemia drugs might be feeding tumor growth began to outweigh the perceived benefits of fewer blood transfusions and better quality of life for cancer patients.

Sales of Aranesp, Amgen's top-selling product, fell 12 percent last year to $3.6 billion, while sales of Procrit, which is less important to J&J's bottom line, fell 9.4 percent to $2.9 billion.

The so-called erythropoiesis-stimulating agents (ESAs) are FDA approved to treat anemia in patients with chronic kidney failure, and in cancer patients undergoing chemotherapy.

TREATED PATIENTS MORE LIKELY TO DIE

The FDA has reviewed studies showing that patients with breast or cervical cancer who were treated with ESAs died sooner, or had more rapid tumor growth, than similar patients who were not given the drugs.

The agency said a trial of Aranesp in women who received chemotherapy before breast-cancer surgery found that after three years, 14 percent of patients treated with Aranesp had died, compared with 9.8 percent who did not get the drug.

Those findings could compel the FDA panel to seek a suspension of ESA use in breast cancer patients or even all cancer patients with solid tumor cancers, according to Wall Street analysts.

Rodman and Renshaw analyst Michael King put the chances of the panel calling for an end to ESA use in breast cancer patients at 30 percent and said there is a 10 percent probability that it would vote to cut off oncology use altogether.