EU pulls plug on Glaxo's Avandia, FDA restricts

LONDON/WASHINGTON (Reuters) - European officials moved to pull GlaxoSmithKline’s diabetes drug Avandia off the market and U.S. authorities imposed tight restrictions over heart risks, effectively spelling the commercial end to the once-lucrative medicine.

Pharmacy staff holds a package of the diabetes drug Avandia in a pharmacy in Berlin, July 14, 2010. REUTERS/Thomas Peter

Once a top treatment choice and Glaxo’s No. 2 seller, the rulings attempted to resolve a bitter, three-year debate over Avandia’s safety that has dogged the reputation of the medicine and its maker, and divided staff inside the U.S. Food and Drug Administration.

The moves cleared the way for newer diabetes treatments to gain market share. Merck & Co’s drug Januvia and AstraZeneca Plc and Bristol-Myers Squibb Co’s Onglyza were most likely to see a boost, analysts said.

In coordinated statements, the FDA in Washington and the European Medicines Agency (EMA) in London said they agreed on the heart risks associated with the drug but had reached different conclusions on action.

The EMA said it would move to ensure Avandia was off the market in the next few months, while the FDA will require that U.S. patients first try other medicines to control blood sugar and acknowledge that they understand Avandia’s risks.

“Essentially the drug is gone,” Dr. Steve Nissen of the U.S. Cleveland Clinic said in an interview. He predicted about 99 percent of Avandia use would end within six months. “That’s a good outcome.”

Nissen’s 2007 study linking Avandia to a higher risk of heart attacks prompted safety reviews.

“It’s no longer a very important product for Glaxo, and will become even less so,” said Viren Mehta, principal at Mehta Partners, a biopharmaceutical advisory group.

Mehta and other analysts said Glaxo would have some protection from further potential U.S. product liability lawsuits now that Avandia will remain on the market in the United States, however limited its sales potential might be.

Annual sales of Avandia reached $3 billion in 2006 but fell to $1.2 billion by 2009, or 2.7 percent of group sales, as many doctors switched to Takeda Pharmaceutical’s rival drug, Actos.

The FDA is probing if Actos may be linked to bladder cancer, which could depress its sales.

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Glaxo shares closed down 1.8 percent on the New York Stock Exchange to $39.43, having lost as much as 2.6 percent in London ahead of the announcements.


Both Avandia, known generically as rosiglitazone, and Actos, or pioglitazone, are known to raise the risk of heart failure, where the heart fails to pump blood efficiently.

But Avandia also has been linked to an increased risk of heart attacks by some studies. Those results have been contested by Glaxo and some other researchers.

Dr. Janet Woodcock, head of the FDA’s drug division, said the true heart-attack risk associated with Avandia was unclear.

“As a matter of prudence, we are restricting access. We are not withdrawing the drug at this time because there is considerable uncertainty about this signal and whether or not it’s valid,” she told reporters in a conference call.

Requiring patients and doctors to meet certain criteria in order to get the drug “means people will think twice” before using Avandia, she added.

About 600,000 U.S. patients currently take Avandia, FDA officials said.

EMA’s senior medical officer, Dr. Hans-Georg Eichler, said the biggest problem was that heart risks already were very common in diabetes patients, and distinguishing which of them are due to the drugs patients take is extremely tricky.

“We struggled with it, and colleagues in other jurisdictions struggled with it as well,” he told reporters.

Glaxo argues that extensive research has shown Avandia to be safe and effective when used according to the label. But the company said it would voluntarily end promotion of Avandia in all countries.


The decision failed to please some of the FDA’s harshest critics. Many said the agency should have acted sooner and questioned if the FDA could enforce its restrictions.

Consumer advocate Sidney Wolfe, head of Public Citizen’s Health Research Group, said the FDA “again caved to industry pressure.”

“Too many people could still be exposed to this dangerous product,” he said.

Avandia sales in the first half of 2010 were down 18 percent at 321 million pounds ($503 million). The United States accounted for 164 million pounds and Europe 72 million.

Glaxo said one-off costs in 2010 associated with Avandia would be about 100 million pounds on a pre-tax basis.

Deutsche Bank analyst Mark Clark said the Avandia charge and Glaxo’s forecast of minimal future sales suggested earnings per share in 2010 would be 3 percent lower than expected, with 2 percent downside to 2011 and 1 percent to 2012.

In July, Glaxo said it expected to record a legal charge of 1.57 billion pounds ($2.4 billion) for the second quarter after settling the “substantial majority” of Avandia-related claims.

(Additional reporting by Kate Kelland, Kate Holton, Paul Sandle in London; Susan Heavey in Washington; and Ransdell Pierson, Lewis Krauskopf and Bill Berkrot in New York)

Editing by Michele Gershberg, Carol Bishopric and Tim Dobbyn