Amgen's romosozumab red flag on heart safety means a boost for new Radius bone drug

Even with Amgen's romosozumab out of the picture for the time being, Radius' Tymlos will still have to face down competition from Eli Lilly's Forteo.

When Radius Health scored an early approval for its osteoporosis med Tymlos last month, industry watchers thought it wouldn't be long before the drug had to contend with another newcomer from Amgen. But now, Amgen says it’ll be a while before its drug hits the market—if ever.

On Sunday, Amgen and partner UCB announced they’d turned up safety data for their candidate, romosozumab, that doesn't sound so good. In a phase 3 study against Merck & Co.'s Fosamax, an imbalance in "serious cardiovascular adverse events” cropped up, with 2.5% of romosozumab patients suffering a CV issue versus just 1.9% in the Fosamax group.

While the companies didn’t go into specifics on the nature or severity of the CV events, the news was “clearly negative, and very surprising,” Evercore ISI analyst Umer Raffat wrote in a note to clients.

RELATED: Can Radius fight off big guns Lilly, Amgen with new bone drug Tymlos? One analyst says no

Rather than winning approval in July as widely expected, romosozumab now will land on the FDA's safety-review agenda, and that means Amgen can kiss the prospect of a 2017 approval goodbye.

The way Leerink Partners analyst Geoffrey Porges sees it, the “FDA is likely to re-review the entire clinical database for the product, and re-examine the cardiovascular events and rates in the entire sample." Porges also expects to the agency to convene an advisory committee to review the data—and hamper the product with “significant restrictions” if it does make it to market. At this point, though, he’s setting the probability of an eventual green light at just 50-50, he said.

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The delay will knock about 32 cents off Amgen’s 2017 earnings per share, Raffat predicts—and it'll stall an influx of revenue that Amgen needs. The Big Biotech is currently under biosimilar assault, with Novartis' Sandoz already marketing a copy of Amgen's Neupogen and boasting an FDA approval for Enbrel. Drugmakers are going after Neulasta, too, though Amgen is doing its best to hold them off in court. And the company hasn't had the chance to drum up its own biosimilar revenue; its won FDA approval for its Humira knockoff, Amjevita, last September, but the med hasn't yet launched.

The setback will also give Radius time to get established with Tymlos before it has to wrangle with more competition. Jefferies analyst Eun Yang, for one, had predicted “limited upside” for the Tymlos approval, whose launch is backed by 230 reps and 22 medical science liaisons.

One reason? A romosozumab dosing edge: It’s administered only once a week, compared with once a day for Tymlos.

The romosozumab hold-up doesn’t mean Tymlos will get to cruise competition-free. It’s still competing against longtime market anchor Forteo from Eli Lilly, though Radius is hoping Tymlos’ lower, $19,500-per-year price can woo payers. “This is a very attractive value proposition," CEO Bob Ward said in an interview earlier this month.

RELATED: Are new bone drugs from Amgen and Radius cost-effective? Not even close, ICER says

One prominent cost watchdog, however, doesn’t agree. While Tymlos may be cheaper than Forteo, both meds “far exceeded the commonly cited cost effectiveness threshold” of $150,000 per quality-adjusted life year, the Institute for Clinical Economic Review (ICER) concluded in a recent draft report.