Enrique Conterno had meant to take a long “vacation” after a 27-year career at Eli Lilly. But the potential for anemia drug roxadustat persuaded him to forego that plan and take the CEO job at FibroGen instead.
Conterno was “most impressed” by the commercial opportunity for roxadustat—which FibroGen shares with AstraZeneca—and for investigational fibrosis and cancer drug pamrevlumab, as well as the R&D capabilities behind those two programs, SVB Leerink analyst Geoffrey Porges wrote in a Tuesday note after talking to the new CEO.
Based on those drugs’ existing clinical profiles, Porges’ team projected roxa could reach global sales of $3 billion to $3.5 billion by the mid-2020s, with FibroGen entitled to about 40% of the value. Pamrevlumab could deliver $1.2 billion to $1.5 billion in idiopathic pulmonary fibrosis alone by 2028, assuming a 2022 approval and launch.
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It's all getting started in China. Roxadustat has approvals in both dialysis-dependent and nondialysis-dependent chronic kidney disease patients in the country, where FibroGen shares commercial rights with AstraZeneca. The British drugmaker, a successful foreign presence in China’s pharma market, has already started promoting the med with many of the estimated 2,700 hospitals it covers, FibroGen management told Porges.
And, toward the end of last year, the drug won China national coverage on both indications at a price of about $2,128 per year, about 30% above SVB Leerink’s previous estimate. At the news of that “healthy pricing,” Porges’ team in November dialed up roxa’s China sales forecast to $1.4 billion in 2025, from $670 million.
As for roxa’s U.S. path, the drug recently cleared most doubts around its cardiovascular safety profile, showing it matched up to placebo in nondialysis-dependent patients and to Amgen and Johnson & Johnson’s standard-of-care Epogen/Procrit in the dialysis group.
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FibroGen aims to fill that gap. It's not just a field with less competition—it's a larger market, too. But because major CV adverse events seen with roxadustat came in numerically higher than placebo (hazard ratio 1.08) in a pooled data analysis, some investors fear the drug might not win that indication either.
Conterno has a lot to say about those doubts—and he knows what he's talking about. While at Lilly, he helped make Boehringer Ingelheim-partnered SGLT2 drug Jardiance the first diabetes treatment to rack up a CV outcomes approval.
Even in a crowded market like diabetes, Conterno said, many drugs had won CV expansion approvals with higher hazard ratios. In some cases, the upper limits of the hazard ratios’ confidence interval hit well above 1, all the way up to 1.8, according to Porges.
Based on that fact, FibroGen doesn’t expect to run another outcomes trial, nor does it expect the approval to be restricted to dialysis-dependent patients.
Another investor concern Porges noted is roxa’s potential in the U.S. dialysis market because of fixed and "bundled" payment systems the Centers for Medicare & Medicaid Services (CMS) uses for dialysis. That approach puts drugs and dialysis services together, payment-wise, giving providers incentive to use less-expensive drugs—or less drugs, period. CMS might be reluctant to reimburse oral products outside the bundle or to modify it to include new drugs, or so the theory goes.
But FibroGen management pointed to a relatively new CMS rule called the Transitional Drug Add-on Payment Adjustment, which allows for additional payments for new drugs. Although CMS says it covers any “new injectable or intravenous drug or biological” for dialysis, FibroGen plans to apply for that coverage for oral roxadustat in parallel with regulatory review, Porges said.
Given that the designation could offer reimbursement for up to two years—pending collection of more real-world use data and cost impact—the SVB Leerink team expects it would “materially alter what we would otherwise expect to be very limited adoption of roxa in dialysis patients in the U.S.”
Meanwhile, back in China, the reimbursement deal for roxa invited talk of a potential spinoff for FibroGen’s domestic operation into a standalone entity. But executives said they're not considering that option—at least not this year. “However, their comments suggest that this eventuality is still something that the company is actively considering and may be a viable approach to maximizing shareholder value from the corporate structure created in China,” Porges noted.