Does the Arthritis Market Have Growing Pains? – AbbVie Inc (ABBV)

A new hope?
Pfizer’s Xeljanz received U.S. approval late last year and became the first in a new class of treatments called JAK inhibitors. Xeljanz treats early-stage patients as either a combination therapy with methotrexate or as a monotherapy in treatment-resistant patients. As an oral medication, Xeljanz has a chance at wooing some patients away from the TNF injections. But the majority of patients will probably stick with what’s already working for them.

Several pipeline candidates were trying to join Xeljanz as new drugs to market, but a few have already crashed. Eli Lilly cancelled late-stage tabalumab because of insufficient efficacy. AstraZeneca’s fostamatinib proved inferior to Humira in mid-stage trials.

What’s still standing? Regeneron and Sanofi have phase 3 sarilumab. This drug is yet another injectable that works best in combination therapy with methotrexate. Johnson & Johnson teams with GlaxoSmithKline on the injection sirukumab, which began phase 3 trials last year.

Xeljanz beats those development drugs in more than dosage route. Pfizer’s rookie can be used in patients who haven’t tried TNF drugs yet, allowing it to stand out as a second-line treatment.

Foolish final thoughts
We’ve taken a tour through the basic drugs that currently dominate the RA market, but let’s circle back to the Decision Resources prediction of modest RA revenue growth. First, the company might be wrong — it’s an estimate, not a crystal ball.

But now looks like a peak time for the TNF inhibitors, as biosimilars could come to market in the not-too-distant future. Humira’s patent expires in 2016, and the arrival of cheaper copycat drugs, paired with the growth of oral options, could serve as a long-term headwind for market growth. This poses a challenge for a number of companies, with AbbVie, the house that Humira built, leading the pack.

The article Does the Arthritis Market Have Growing Pains? originally appeared on Fool.com and is written by Brandy Betz.

Brandy Betz has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Johnson & Johnson.

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