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Novartis MDx Could See Near-Term Promise in 'Complementary' Diagnostics Over Companion Tests


This article has been updated from a previous version to include information on the filing status of lumiracoxib in Europe, to clarify the current indication for nilotinib, and to correct information about the company's BCR-ABL development partners.

By Turna Ray

When it comes to advancing personalized medicines in its own portfolio, Novartis's diagnostics unit is focusing on advancing so-called complementary diagnostics, which may be less challenging from a codevelopment and regulatory standpoint than companion tests and could be more profitable in the short term for the drug developer.

In a recent draft guidance, the US Food and Drug Administration defined a companion diagnostic as a "device that provides information that is essential for the safe and effective use of a corresponding therapeutic product." Speaking at the World Companion Diagnostics Summit in Cambridge, Mass., last week, Vijay Modur, head of diagnostic discovery at Novartis's molecular diagnostics division, said that alongside companion diagnostics, the company is also developing complementary tests, which he described as "any test that is not a companion diagnostic requiring a drug/diagnostic regulatory link at the time of development."

Although "complementary diagnostics can also be companion diagnostics," Novartis is "splitting hairs purely on the basis of regulatory definition," Modur said. Complementary diagnostics don't necessarily need high-level development coordination with a drug or simultaneous drug/test approval from the FDA, he explained. As such, complementary tests may provide a lower barrier to market entry for Novartis.

Novartis envisions developing complementary diagnostics in four areas: improving management of disease, early diagnoses, risk stratification, and therapeutic drug monitoring. One example of an area Novartis is exploring for complementary tests for drugs for chronic myeloid leukemia, such as its Gleevec franchise, where the company has already taken steps to standardize BCR-ABL testing for monitoring leukemia patients on the drug.

Three years ago, Novartis launched its internal molecular diagnostics unit, a strategy not commonly pursued by pharma companies. When structuring its molecular diagnostics division, Novartis settled on building a fully integrated unit within its pharma division. "This is an approach that is different than what other [pharma] companies are thinking," Modur said. "We believe this approach is really forward looking and that many other companies will begin to look this way."

Roche has a diagnostics division that operates independently of its pharma unit. Although Abbott had a similar model, the company in October announced plans to split its pharmaceutical research operations and Abbott Molecular into two publicly traded companies. Most other drug firms have opted to partner with diagnostics companies to develop companion tests for their drugs.

Industry observers have identified various advantages and disadvantages of having drug and diagnostic capabilities under one roof instead of pursuing a collaboration strategy. Proponents of the former model say that internal diagnostics capabilities may allow drug developers to recognize earlier when a biomarker or companion test strategy is needed for a drug. Supporters of outsourcing diagnostics development argue that pharmas should stick to what they know best, and let test makers do what they do best.

Which model will prove to be most profitable for drug developers remains to be seen, and recent examples present a split decision. Of the two pharmas that have most recently succeeded in developing and launching drug/diagnostic personalized medicine products, Pfizer partnered with Abbott Molecular to develop a companion ALK test to gauge best responders for its non-small cell lung cancer drug Xalkori, and Roche internally developed a BRAF test to accompany its melanoma drug Zelboraf.

"Integrating companion diagnostics into a pharma [business] will take much, much more than merely setting up an in-house diagnostics division, something which … it has taken Roche years to start to get right," Peter Keeling, CEO of consulting firm Diaceutics, told PGx Reporter recently via e-mail. Diaceutics advises drug and diagnostics companies on how to partner with each other to develop personalized medicines.

Novartis hasn't brought a drug/test combination product to market since launching its diagnostic group — perhaps because such a proposition is complicated by the need to coordinate drug and test development timelines and gain significant input from regulatory authorities.

Lumiracoxib is one drug that Novartis is looking to advance with a companion diagnostic strategy. Previously known as Prexige, the FDA refused to approve the COX-2 inhibiting painkiller due to hepatic safety concerns. Novartis announced last year, however, that it was looking into developing a companion test that would exclude osteoarthritis patients who might be more likely to experience adverse events (PGx Reporter 2/10/2010).

The company has since withdrawn an application filed with the European Medicines Agency for the drug and a companion test "based on the inability to address a request to provide additional data within the timeframe of the current procedure," a Novartis spokesperson said this week.

In the short term, complementary diagnostics offer Novartis a way to bring tests to market that will bolster the sales of already profitable drugs and generate leads for the development of new drugs.

Better Diagnostics

Novartis's diagnostics business has three main areas of focus: developing companion tests, advancing complementary tests, and providing testing services. Novartis MDx head Michael Nohaile recently told PGx Reporter sister publication GenomeWeb Daily News that the company's complementary diagnostics business, which wouldn't necessarily focus on launching tests regulatorily restricted to be used only with a specific Novartis drugs, could potentially generate more revenue than companion diagnostic tests for its own pharmaceutical products.

One of Novartis's first projects under the complementary diagnostic umbrella is to develop tools to standardize BCR-ABL testing, which in turn can help physicians personalize treatment strategies with Gleevec and similarly targeted drugs for Philadelphia chromosome-positive CML. As part of this effort, Novartis recently inked an agreement with Asuragen to develop calibrators and laboratory software reporting tools to standardize BCR-ABL testing performed at labs (PGx Reporter 12/8/2010).

Novartis has marketed Gleevec for a decade for the treatment of Ph-positive CML, and it netted the company $4 billion in revenue in 2010. It is already standard practice among oncologists to molecularly monitor BCR-ABL transcript levels to ensure patients aren't relapsing or having a refractory response to treatment. However, there is a lack of standardized procedures and reference materials for leukemia monitoring, which can make it difficult for doctors to monitor the disease.

"Why does Gleevec need better diagnostics? The dosing for Gleevec is very variable, so that's $4 billion of revenue for Novartis that is coming from an imperfect market," Diaceutics' Keeling said. "By pointing better diagnostics to the [Gleevec] franchise … Novartis stands to get additional revenues from diagnostic sales … but also Novartis will get more revenue per patient increases."

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Citing the example of Gleevec, Modur noted that existing gaps in disease management can be narrowed with better tools that inform diagnoses, and this is where Novartis' complementary diagnostics can make an impact.

Using complementary tests to improve disease management, such as through standardized BCR-ABL testing, Novartis hopes to improve patient compliance for its marketed drugs.

"What we've been able to show is that when you partition patients based on the level of BCR-ABL transcript in the blood that measures leukemic cells, we can show long-term benefit [from Gleevec treatment] in those patients who have very low levels of leukemic burden," Modur said.

Furthermore, investing in a stable diagnostics market for BCR-ABL testing should continue to pay off for Novartis even after Gleevec loses patent protection in 2015. BCR-ABL testing is helping to grow the market for another Novartis drug, Tasigna (nilotinib), approved by the FDA last year for adult patients with newly diagnosed Ph-positive CML in chronic phase.

In clinical trials for Gleevec, Novartis initially incorporated BCR-ABL as an exploratory biomarker. That biomarker "transitioned very quickly into a marker for patient monitoring and levels were used to monitor patient response," Modur recalled. "And when we showed these levels are associated with long-term benefit, it became a surrogate marker … [that] we used to put nilotinib into the market after a one-year trial."

Although Novartis has made investments to build its internal companion and complementary test development capabilities, the firm's collaborations with Asuragen and Cepheid around BCR-ABL testing demonstrate that the company is open to strategic diagnostic partnerships. "We will do what it takes," Modur said. "We will partner with in vitro diagnostics companies or do it on our own."

Other Applications

Beyond disease management, complementary tests can also be used to diagnose patients early for life-threatening or degenerative conditions, which would enable them to be treated earlier, according to Modur.

Additionally, in the area of risk stratification, complementary diagnostics can lead to the development of targeted drugs for patient subsets. "It's a way to be forward looking in the pipeline," Modur said. "We want our drugs to succeed and we want to prime the pump. One of the ways we can prime the pump is through knowledge of risk guiding therapy [development]."

By using complementary diagnostics in this manner, Novartis is attempting to differentiate itself from competitors. Furthermore, "Novartis can have a better conversation with payors," Modur said, by showing that its complementary testing strategy can pick out patients at high risk of a disease, who might ultimately benefit from treatment with the company's drugs.

"Even if the drugs are successful, payors are still going to ask, 'Who's at the highest risk and how do we manage these patients and can you show that you can make difference in the patients with the highest risk?'" Modur posited.

In this vein, Novartis is applying its complementary diagnostics strategy as part of Phase III trials enrolling "several thousand" patients with chronic heart failure and acute decompensated heart failure. Through these studies, Novartis aims to use its complementary tests to prognose which patients are at high risk of heart failure and are likely to be hospitalized and then show that its drugs also benefit that population.

Finally, diagnostics used for therapeutic monitoring can provide insights into which drugs work in which patients, and such complementary tests can eventually mature to companion tests. Novartis is using complementary tests for therapeutic drug monitoring as a "way to enable efficacy" of its drugs, Modur said.

Novartis' diagnostics efforts are still very much in their infancy. Although the company hasn't broken out earnings figures for the molecular diagnostics unit, officials have said that the division comprised a small part of the company's $51.6 billion in 2010 revenues.

According to Modur, the development of complementary and companion diagnostics requires close collaboration between biomarker, research, and marketing groups.

"Clearly, drug development and diagnostics are tied at the hip," Modur noted. "Where it all starts is really having a strong biomarker group, having a systematic biomarker approach, and then focusing on getting the key questions right, which then mature into diagnostics tools for therapy."

This type of collaboration is a crippling challenge for most pharma companies unburdened by diagnostics divisions, however.

"One reason why it is so hard to integrate [companion diagnostics] into the Rx development and commercial model is that you require a root-and-branch reform of how therapies dependent upon diagnostics are developed," Keeling said.

"Frankly this is a tough change-management task. Thus, the Novartis model looks like a 'fix' in one way, but still leaves the essential task of persuading pharma R&D leaders of the potential of diagnostics to improve the clinical and financial health of the assets they are developing."

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