* High rate of hypersensitivity, GI intolerability seen
* Roche says eyeing reformulation of medicine
* To communicate future plans for drug by year end (Adds details on hypersensitivity reactions)
By Bill Berkrot
NEW YORK, Sept 10 (Reuters) - Roche Holding ROG.VX has stopped giving patients its experimental diabetes treatment taspoglutide in late stage clinical trials due to a high rate of adverse reactions, marking a major blow to drug once seen to have $2 billion a year potential.
The Swiss drugmaker said on Friday that the decision was based on a higher-than-expected rate of discontinuations due to gastrointestinal (GI) intolerability, and due to serious hypersensitivity reactions experienced by some patients, according to 52-week data from the trials.
“These discontinuation rates compromise interpretation of the long term safety data from the T-emerge studies, therefore continuing treatment with the current taspoglutide formulation is not considered to be in the best interest of patients,” Roche said in a statement.
Leerink Swann analyst Joshua Schimmer said in a research note that if Phase III dosing has been suspended “we believe that this is the final blow for what was perceived as a compound in trouble after the disappointing data on hypersensitivity and nausea/vomiting presented at the American Diabetes Association (meeting) this year.”
The drug, given once weekly by injection, suffered a serious setback in June, when it was reported that there were cases of patients suffering hypersensitivity reactions to the medicine in clinical trials.
The latest blow to Roche is seen as a boon to Amylin Pharmaceuticals Inc AMLN.O and Eli Lilly and Co (LLY.N), which are awaiting a U.S. approval decision for their once-weekly injectable diabetes drug Bydureon.
Amylin shares closed up 1.9 percent, while Lilly shares finished up 0.8 percent.
Roche said it was not abandoning its drug, but was considering a reformulation of the medicine. Any reformulation would likely cause a significant delay beyond the one Roche signaled in June when the hypersensitivity data was revealed at the diabetes meeting.
At that time Roche said the setback would likely cause a delay in filing for approval of a minimum of 12 to 18 months. It had previously been aiming to apply for taspoglutide approval worldwide in 2011.
“Roche is assessing approaches to identify the root cause of the serious hypersensitivity reactions and to optimize the taspoglutide formulation to improve GI tolerability,” Roche spokesman Terrence Hurley said.
“Upon review of options available, Roche will communicate about the next steps of the overall taspoglutide program by year end,” he added.
Roche said out of 3,000 patients there were 23 cases of serious hypersensitivity reaction, and that all the patients recovered without complications.
While the percentage is low, as with the GI problems the number was higher than expected, Roche said.
The most frequently reported symptoms in patients who developed hypersensitivity reactions were skin reactions, nausea, and vomiting, while cardiovascular and respiratory symptoms were less frequent, Roche said.
Roche, which licensed taspoglutide from France-based Ipsen(IPN.PA), once had high hopes for for the drug. It had said in the past that taspoglutide could garner peak sales of at least 2 billion Swiss francs ($1.77 billion).
However analysts had already sharply lowered their sales projections for the drug following the previous clinical setbacks.
“Amylin’s Bydureon is expected to be the only weekly GLP-1 in the near-term,” said ISI Group analyst Mark Schoenebaum in a research note, referring the class of drugs to which the Amylin/Lilly and Roche drugs belong. (Reporting by Bill Berkrot; editing by Carol Bishopric)