As Shire gives up on Replagal in U.S., Sanofi stands to gain
Sanofi ($SNY) may want to thank its lucky stars that its new Genzyme plant won FDA approval when it did. The facility in Framingham, MA, will allow the French drugmaker's rare-disease unit to get back on track with its Fabry disease drug Fabrazyme. It may also have deterred Shire from pursuing its own Fabry drug application in the face of complications at the FDA.
Shire pulled its application for approval of Replagal, the Fabry treatment it has been providing to 140 U.S. patients free of charge during the Fabrazyme shortage. The company had filed its app in November, saying it expected a quick review. Now, Shire says it's expecting the FDA to ask for more data, but conducting more studies wouldn't be worth the time and expense. Replagal has been approved in Europe since 2001.
So, the U.S. market will remain competition-free for Fabrazyme. It's not the outcome people had expected, once Genzyme's manufacturing troubles triggered severe shortages, and ongoing efforts to boost supply faltered. When Shire moved in under FDA's compassionate use program, taking advantage of the Fabrazyme problems, market-watchers expected Replagal to become a permanent competitor in the U.S., just as in Europe. Analysts figure the FDA's early encouragement to Shire stemmed from worries about the Fabrazyme shortage, Reuters says. However, now that supply problems are easing, the agency isn't so anxious to get an alternative to market quickly.
Jefferies analyst Peter Welford said Shire's choice is a "surprise setback" for the company, and one that will help Sanofi regain market share. "Sanofi/Genzyme has won the U.S. race," Deutsche Bank's Mark Clark said in a note to clients (as quoted by Bloomberg). As for Sanofi itself, the company "believes this situation will provide an upside to Fabrazyme as production recovers," spokesman Jean-Marc Podvin told the news service.