Lucentis Gains EU Approval for DME - Analyst Blog

Novartis AG (NVS) recently received European approval for Lucentis to treat patients with certain forms of diabetic macular edema (DME). It is an eye condition related to long-standing diabetes that may lead to blindness, particularly in working-age population in most developed countries. Lucentis led to an improvement in vision and vision related quality of life in patients with visual impairment due to DME. Lucentis is currently marketed for the treatment of wet AMD.

The current standard of care for DME is laser therapy, which can stabilize vision but not improve it. Lucentis showed faster, better and sustained gain in visual activity compared to dummy therapy or laser therapy as demonstrated by pivotal data from RESTORE and RESOLVE trials. Patients treated with Lucentis recovered their vision by the eighth day, on an average, after the first injection. The vision improvement was maintained at one year with some patients regaining the ability to carry out daily activities such as driving.

Data from the RESTORE study showed that at twelve months, patients treated with Lucentis gained an average of 6.8 letters in visual acuity compared to baseline. Similarly, patients treated with Lucentis plus laser therapy gained an average of 6.4 letters in visual acuity. On the contrary, laser-treated patients gained an average of 0.9 letters as measured on a standard ETDRS eye chart.

The RESOLVE study showed similar results at twelve months where Lucentis-treated patients gained an average of 10.3 letters in visual acuity compared to baseline. However, patients treated with dummy therapy, some of whom also received laser treatment, lost an average of 1.4 letters.

Further, an independent US study examining Lucentis for the treatment of DME compared to laser therapy showed that at 12 months patients treated with Lucentis plus laser gained an average of 9 letters in visual acuity compared to baseline. However, patients treated with laser therapy gained an average of 3-4 letters.

Novartis had received a positive recommendation from the Committee for Medicinal Products for Human Use (CHMP) for this indication in October 2010.

Our Recommendation

Currently, we have a Neutral recommendation on Novartis, which is supported by a Zacks #3 Rank. We are pleased with Novartis' wide range of products and its efforts to diversify further as is evident by the recent acquisition of a majority stake in Alcon (ACL). Novartis is looking to acquire the remaining stake in the eye-care company.  However, we prefer to remain on sidelines due to the upcoming patent cliff for the company as a number of Novartis drugs will face generic competition between 2011 and 2015.