Novartis sees start of $2B dermatology opportunity with new EU Xolair approval

Courtesy of Genentech/Novartis

On Thursday, Novartis ($NVS) won European approval for its injectable Xolair to treat chronic hives--the first such product cleared there for patients who don't respond to antihistamines alone. Sales of the drug for this condition, called chronic spontaneous urticaria (CSU), could add as much as $500 million a year to the $613 million Xolair is already brings in for asthma--and Novartis predicts it will help launch the company into a leading position in dermatology.

David Epstein, division head of Novartis Pharmaceuticals, told analysts at a Cowen & Co. healthcare conference earlier this week that dermatology represents a $2 billion to $3 billion opportunity for Novartis, with high margins to boot, according to PMLive. That's because in addition to Xolair's potential in treating CSU, Novartis has high hopes for secukinumab, the psoriasis treatment that aced its Phase III trials and will be contending for regulatory approvals this year.

The Swiss drug giant is now in a close race with Amgen ($AMGN) and AstraZeneca ($AZN), which are co-developing a psoriasis treatment, brodalumab, that has also shown promise in late-stage trials. Both drugs work by inhibiting interleukin-17, a cytokine that has been implicated in psoriasis and other autoimmune diseases.

Last July, Novartis reported that secukinumab outperformed Amgen's psoriasis blockbuster, Enbrel, in a head-to-head trial. And in October, Novartis said that its newest data showed that 77% of patients on secukinumab saw a 75% clearance of their skin lesions.

Epstein said Novartis has the scale it needs in dermatology to become "one of the biggest players in the market," according to PMLive.

While Novartis awaits regulatory approval in psoriasis, all eyes will be on Xolair and its opportunity in CSU, a disease that affects 1% of the world's population, says PMLive. Xolair is approved to treat CSU in 5 other countries and is currently contending for regulatory approval in 20 other countries, including the U.S., where Novartis says it expects a positive verdict within weeks.

- here's the PMLive story