German cost gatekeeper spurns Gilead's Zydelig for CLL

Gilead Sciences ($GILD) was dealt a stinging blow from Germany's price watchdog IQWiG over its cancer-fighting drug Zydelig (idealisib), as the cost-effectiveness gatekeeper found the drug has no added benefit for patients with chronic lymphocytic leukemia (CLL) compared with existing therapies.

The Federal Joint Committee (G-BA) said that the drug can be used as a second-line treatment for patients with follicular lymphoma who have not responded to treatment or as a first-line therapy for individuals who cannot undergo chemotherapy due to certain genetic mutations. But Gilead did not provide any "suitable data" showing that Zydelig performs above and beyond its competitors, the G-BA said in a statement. The company only ran single-arm studies that did not compare the drug to existing therapies, and presented results from an approval study that did not use an appropriate comparative product, the German cost watchdog said.

The G-BA's decision does not bode well for Gilead as it attempts to expand its footprint in the oncology market. In July, the company won FDA approval for Zydelig, a first-in-class Pl3K inhibitor that boasts some promising results: The drug, when combined with Roche's ($RHHBY) Rituxan, staved off cancer growth twice as long as Rituxan alone. Zydelig's overall response rate rang in at 81% compared with Rituxan's 13%. EvaluatePharma puts the drug's sales at $1.2 billion by 2020, but other analysts are predicting faster growth of $1.5 billion by 2017.

But Gilead is not content to settle for the status quo; The company in December teamed up with Ono Pharmaceutical for its oral cancer drug, ONO-4059, to gain more clout in the field. Gilead and Ono are considering pairing ONO-4059 with Zydelig, among other options, to treat blood cancers.

In the meantime, Gilead faces some stiff competition from other pharma heavyweights looking to grab a bigger share of the oncology market. In June, Johnson & Johnson ($JNJ) and Pharmacylics ($PCYC) won an expanded label for its cancer fighter Imbruvica. In December, Amgen ($AMGN) scored a key approval for Blincyto, an immunotherapy targeted at a rare form of acute lymphoblastic leukemia. The company is pushing for earlier use of its approved third-line treatment for multiple myeloma, Kyprolis, setting the stage for a showdown with Celgene's ($CELG) already-approved treatment Pomalyst.

- read IQWiG's statement (in German) (PDF)

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