PREVIEW-Decision time for Bayer and Glaxo drugs in U.S.

* FDA verdict due on Bayer/J&J drug Xarelto by May 28

* U.S. panel meets on Glaxo/Genmab’s Arzerra on May 29

* Xarelto may face delay; Arzerra expected to be recommended

LONDON, May 21 (Reuters) - A crunch week looms for Bayer BAYG.DE and GlaxoSmithKline GSK.L as U.S. regulators decide the fate of two experimental drugs for blood clots and leukaemia that are key for both companies.

The Food and Drug Administration is due to give its verdict by May 28 on Bayer's anticoagulant Xarelto, which is being developed with Johnson & Johnson JNJ.N.

It has already been recommended by outside experts, but final approval on schedule is not guaranteed.

A day later, Glaxo and partner Genmab GEN.CO face an FDA advisory panel on new leukaemia drug Arzerra, which is widely expected to get a positive recommendation.

Xarelto is Bayer’s biggest new drug hope, with peak sales forecast by the company to reach 2 billion euros ($2.8 billion) a year for all uses, although the initial indication is limited to short-term prevention of clots after orthopaedic surgery.

An FDA panel voted 15 to 2 in favour of Xarelto on March 19, but experts cited lingering concerns about possible liver damage, bleeding and worries about long-term use. Given the cautious stance of the U.S. regulator at present, a delay in final clearance is therefore quite possible.

“This is clearly an approvable product. Will it get its PDUFA (FDA action) date? We’ll know in two weeks -- but I wouldn’t hold my breath,” Bayer HealthCare CEO Arthur Higgins told Reuters on May 14.

The agency may ask for a risk evaluation and mitigation plan, given the potential for Xarelto -- given as a convenient pill -- to be used off-label for longer than indicated. That could delay approval by 3-6 months, Citigroup analysts said.

If approved, Xarelto would be the first oral blood thinner cleared for use in the United States since the widely-used drug warfarin was launched more than 50 years ago. It would compete with Sanofi-Aventis's SASY.PA injectable drug Lovenox.

The initial market for treating patients after knee and hip replacement surgery is not huge. The big opportunity lies down the road in other uses, such as stroke prevention, that would require patients to take the drug on a long-term basis.


Arzerra is arguably less important to Glaxo, given the size of existing sales at the world’s second biggest drugmaker. But it is pivotal in establishing the British group as a force in cancer medicine, and was highlighted as such by CEO Andrew Witty at the company’s annual meeting this week.

Arzerra will compete with Roche's ROG.VX Rituxan/MabThera, which sold more than $5 billion in 2008.

Analysts believe annual sales of the new product could eventually top $2 billion, although the drug is unlikely to reach its full potential until the middle of the next decade.

Its initial use will be for treating cases of chronic lymphocytic leukaemia that do not respond to existing therapies, with larger indications expected to follow.

A positive recommendation from the FDA Oncologic Drugs Advisory Committee next week would be a major event for Danish biotech company Genmab, which signed a deal with Glaxo for the drug at the end of 2006.

($1 = 0.7254 euro)

editing by John Stonestreet