* Lilly says to begin big new trial by Q3 2013
* Drug failed previous trials, helped mild Alzheimer’s
* Could have annual sales of up to $10 bln-analysts
* Lilly shares fall, no immediate filing for approval (Adds Lilly, analyst comments, other company medicines)
By Ransdell Pierson
Dec 12 (Reuters) - Eli Lilly & Co said it will conduct a large new trial of its treatment for Alzheimer’s among those with mild symptoms instead of seeking U.S. approval of the product based upon prior trials in which the drug failed to help a wider group of patients.
Solanezumab failed to help patients with mild to moderate symptoms of the memory-robbing disease in two large studies which concluded last summer.
The drug delayed by more than 30 percent declines in cognitive function of those with only mild symptoms, but did not slow the loss of abilities to conduct daily activities, like dressing and driving. Eli Lilly shares fell 3.2 percent in morning trading.
“Some investors were hoping that Lilly would file for approval now based on existing drug data, but that was overly optimistic,” said Richard Purkiss, an analyst with Atlantic Equities who predicts sales of $5 billion to $10 billion for solanezumab if it is eventually approved.
“A new trial is the sensible thing,” Purkiss said, “because so many people would be taking this drug, and so quickly due to the unmet medical need, that regulators have to be certain there’s a clinical benefit.”
Lilly said it had decided, after talks with the U.S. Food and Drug Administration, and European and Canadian regulators, not to seek U.S. approval of solanezumab, at least for now.
The company plans to begin the new Phase III study by no later than the third quarter of 2013.
An estimated 5 million Americans have Alzheimer‘s, the biggest cause of dementia. More than 35 million people worldwide are believed to have dementia, including Alzheimer’s disease, and those numbers are expected to rise as more people live longer.
“For someone with mild Alzheimer‘s, if we can slow the time this horrible disease progresses, that would be an important claim to make,” David Ricks, president of Lilly Bio-Medicines, said in an interview.
Lilly badly needs new medicines because its earnings will plunge through 2014 as its biggest products face competition from cheaper generics.
The Indianapolis drugmaker is counting on solanezumab to help revive company results, should it win approval, along with a promising roster of experimental drugs to treat arthritis, cancer and diabetes.
A similar, closely watched Alzheimer’s drug from Pfizer Inc , bapineuzumab, earlier this year also failed in big studies. Researchers did not cite any benefits to patients with mild symptoms.
Both drugs work by binding to amyloid beta - protein fragments that form toxic plaques in the brain that are considered a hallmark of Alzheimer’s disease.
Lilly, along with Merck & Co Inc and others, is developing another class of drugs that block amyloid through a different route - by inhibiting production of an enzyme called beta secretase.
Leerink Swann analyst Seamus Fernandez said the BACE inhibitors may be “closer to the Holy Grail” in treating Alzheimer’s than drugs like solanezumab, and that a safe and effective one could capture annual sales of $10 billion or more.
Lilly research chief Jan Lundberg, in an interview with Reuters last week, predicted the company will do for Alzheimer’s patients what it did almost a century ago for diabetics - find a breakthrough treatment, even though skeptics say it could take years. (Reporting by Ransdell Pierson; Editing by Jeffrey Benkoe, Theodore d‘Afflisio and Tim Dobbyn)