Biogen Idec now has FDA approval for Alprolix, the first in a new wave of long-acting hemophilia treatments on their way to market. For Biogen ($BIIB), the thumbs-up is an opportunity to grab market share with a hemophilia B product that works three times as long as current clotting factors. But what will the ensuing market battle mean for Baxter ($BAX)?
As The Wall Street Journal reports, Baxter is the current hemophilia market leader, and that business accounted for more than 58% of its biopharmaceutical sales last year. Now, that $3.4 billion in sales could soon be in jeopardy. And with the Deerfield, IL-based Baxter's new plans to spin off that unit, the stakes just got higher.
As the Journal notes, much of the success of Baxter's hemophilia franchise--about $1.8 billion, estimates Piper Jaffray analyst Matt Miksic--came on the shoulders of one product, the hemophilia A treatment Advate. Revenues from that drug will be safe from Alprolix. It's Baxter's twice-weekly Rixubis that will go head-to-head with Alprolix in the $1 billion market for hemophilia B.
But Biogen is getting ready to disrupt the $6 billion hemophilia A market, too. A recent analyst survey said its long-acting treatment, Eloctate, would likely grow to command up to 37% of the adult market over the next two years. That drug is on track for approval in mid-2014. And a handful of other companies are jockeying for position in hemophilia, including Novo Nordisk ($NVO), with new approvals on their way.
That's not to say Baxter isn't working on its own plans for treatments that require fewer infusions. It, too, has a long-acting hemophilia A product in the works, but it could be a year to two years behind Biogen's, JP Morgan analyst Mike Weinstein told the WSJ. "Right now, they'll have an exposure," he said. "This is not a one-time hit to that business."
Still, as always, the size of Baxter's hit will depend on patient preferences and loyalty to current treatments. "They may opt for convenience one day, but what they'll do over the next few years can be different," Miksic told the Journal.
- read Biogen's release
- get more from the WSJ (sub. req.)
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