Elagolix Enters Phase 3
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By Jason Napodano, CFA
On June 5, 2012,
Abbott Labs (NYSE:
Neurocrine Biosciences (NASDAQ:
that they had initiated a pivotal phase 3 clinical study designed
to evaluate the safety and efficacy of elagolix in female patients
with endometriosis. Abbott designed the protocol of the trial after
over a year of back-and-forth discussion with the U.S. FDA, but
chose not to pursue a formal SPA to avoid further delay in the
start of the program.
The phase 3 trial, dubbed M12-665, is a randomized, double-blind,
placebo-controlled study seeking to enroll 875 women, age 18 to 49,
with moderate-to-severe endometriosis-associated pain. It will be
conducted at approximately 160 sites in the U.S., Puerto Rico and
Canada. The primary endpoint will be a dual-endpoint in reduction
in Dysmenorrhea and Non-Menstrual Pelvic Pain (NMPP) for women on
two doses of elagolix (150mg and a yet unannounced higher dose) vs.
placebo in a 1:1:2 randomization over 3 months.
Efficacy will be assessed by a responder analysis for statistical
evaluation. The inclusion of a yet unannounced higher dose of
elagolix, perhaps 250mg or 300mg (150mg BID) is intriguing.
Responder analysis from the phase 2b trial showed an 85% response
rate with 150mg elagolix. We believe Abbott is looking for greater
than 90% response rate in the phase 3 program through the inclusion
of a higher dose.
Secondary endpoints include Dyspareunia and Patient Global
Impression of Change (PGIC), as well as analgesic use. Following
the 3 month controlled portion of the trial, patients will be
eligible to enroll in a 6 month open-label extension study where
Abbott will look for signs of persistent efficacy. For the safety
analysis, patients will be followed for an additional 12 months,
after which Abbott will conduct a DXA scan to assess changes in
bone mineral density.
We expect that this program will take 12 months to enroll. Top-line
data from the phase 3 trial should be available in the first half
of 2014, with the full analysis in 2015. Abbott plans to conduct a
second confirmatory phase 3 program mirroring the M12-665 trial
expected to start in 2013. We expect that this program will include
sites outside North America, with an emphasis on Western Europe.
Full analysis from the second trial is expected in 2016, along with
the New Drug Application (NDA) planned for 2016.
...Confident In Design...
We are confident in the design of the phase 3 trials, and the
efficacy and safety previously seen with elagolix. In total,
Neurocrine has presented data from 12 phase 1 programs and 6 phase
2 programs (2 phase 2a and 4 phase 2b) on roughly 1,000 patients.
Results from the phase 2b (n=137) Daisy PETAL (Study-901) program
first released in May 2010 provide the best proof-of-concept data
for the planned phase 3 trials. Final results,
released in November 2010,
were statistically significant in all primary and secondary
The planned phase 3 program will seek to enroll patients with more
severe disease and employ a two-cycle (two-month) run-in period
both designed to mitigate the placebo response. We note the 33%
placebo response on both primary endpoints in the Daisy PETAL
program was rather high, but elagolix at 63% for both was
statistically significant at a p-value less than 0.01. All Abbott
needs to do is replicated these results in the two phase 3 trials
noted above and then show no clinically meaningful changes in bone
mineral density and we think approval is likely.
While the above is all good news for Neurocrine shareholders, it
comes about six months behind what we previously modeled. We remind
investors that the end of phase 2 meeting took place in March 2011.
"Update on Elagolix"
press release from May 2011 guided to the start of the phase 3
trial in the fourth quarter 2011. However, finalizing the SPA with
the U.S. FDA took longer than expected. Ultimately, Abbott believes
they have implemented all of the suggestions from the SPA
discussions, but did not want any further delay in the start of the
We also expected that both phase 3 trials would start concurrently.
Instead, Abbott plans to stagger the second phase 3 trial so it
starts one-year later, in 2013. This is so that the second trial
can include sites outside North America.
As a result, the planned NDA filing, now expected in 2016, is 18+
months farther out then our model. Therefore, we have adjusted our
DCF model to now account for the launch of elagolix at Abbott in
2017. The result is a decrease in our price target from $12 per
share to $10 per share.
Our $10 per share target is now the lowest of the five published
targets we see listed on Thomson/First Call (previous range was
$11.50 to $14.00). However, this should not be misconstrued by
investors. We remain quite optimistic on Neurocrine and elagolix,
believing the drug - with a full label to include both
endometriosis and uterine fibroids - has blockbuster potential.
as to why we see elagolix as one of the more interesting late-stage
biotech products. We clarify our position on Neurocrine as
"optimistic, yet realistic" with respect to the stock price.
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