Acorda's MS Drug Ampyra Looks Good Now, but That Probably Won't Last

Last Updated Nov 17, 2010 3:46 PM EST

Acorda Therapeutics said usage among neurologists and insurers for its new MS drug Ampyra continued to grow in the third quarter. Contrary to management's professed optimism, however, treatment costs and marginal benefits could ultimately limit the drug's appeal.

Ampyra (dalfampridine) is prescribed to improve walking in patients with multiple sclerosis (MS). The oral medication is thought to improve walking (time) and other motor activities by blocking potassium leakage from degenerated myelin sheath (the protective coating around nerve fibers) -- and a hallmark characteristic of MS -- increasing nerve signal conduction from the brain to other parts of the body.

Acorda has 100 sales representatives selling Ampyra in the U.S., mostly to specialists. Launched in March, the suggested action of Ampyra has resonated strongly with health-care providers, according to third-quarter 2010 prescription trends disclosed by Acorda Therapeutics (ACOR):

  • At September 30, patient starts increased quarter-on-quarter 22 percent to 16,920, up from 13,830 on June 30;
  • Some 31,000 folks with MS in the USA have tried the drug, representing almost eight percent of all MS patients in this country; and,
  • Almost 90 percent of high-prescribing specialists have written at least one Ampyra prescription.
"This is a significant penetration only seven months after commercial availability, said Lauren Sabella, vice-president of commercial operations. "Based on data from this yield, we have expanded our initial 5,500 target physicians to approximately 10,000 targets."

Ampyra is the first oral drug approved to treat an MS symptom. Approximately 87 percent of the estimated 400,000 MS patients in the USA have said they experience some limitation to their walking ability, according to a poll of more than 2000 people conducted by the Multiple Sclerosis Association of America.
Although MS is a devastating and progressive disease, payers are now recognizing that -- much like other conditions -- it must be managed to ensure cost-effectiveness. Patients with MS incur medical costs two to three times greater than those of all enrollees in a managed-care organization, according to published findings in the Journal of Managed Care Pharmacy.

With an expanded product launch, sustainable commercial success will ultimately turn on commitments by federal and third-party payers (managed-care and their pharmacy-benefits managers) to reimburse the company for accessed treatment -- driven -- not by perceptions of -- but rather actual evidence of core efficacy.

In the MS treatment paradigm, cost is an issue: Ampyra would be in addition to, rather than replacing, the expenses associated with branded MS biologics.

The average wholesale price (AWP) for Ampyra, dosed 10mg twice daily, is about $1,056 per 30-day supply, or $12,850 per year; Tysabri (natalizumab), an injectable biologic from Biogen Idec (BIIB), can cost more than $33,000 annually. It should be noted, however, that the actual prices paid by wholesalers to drug makers are, on average, 18.3 percent below AWP -- likely even lower for pharmacy benefit plans (managed care).

Vendor rebates, such as discounts, totaled about five percent of gross sales of the $52.5 million for Ampyra during the third quarter.

Robert J. Lipsy, PharmD., cautioned in the September issue of The American Journal of Managed Care that patient adherence decreases "as out-of-pocket expenses increase." For example, abandonment rates rose with each co-pay tier premium increase for patients taking new oral anti-cancer agents, according to records culled from managed care. Similar results were also observed with oral anti-diabetic agents.

"Whether or not a similar pattern will be observed with newer oral MS agents remains to be seen," noted Lipsy.
To Acorda's credit, they've limited patient co-payments to a $40 - $45 monthly ceiling, and offer a generous patient-assistance program for indigent patients. A company cannot, however stay in business giving away all of its product.

Currently, about 10 percent of shipped product is free to patients enrolled in the Ampyra patient-assistance program. Although likely to include co-pay mitigation expenses, Acorda management didn't return my calls seeking a confirmation that free drug was expensed in "costs of goods sold." Anticipated cost of sales for the fourth-quarter is expected to be approximately 21 percent of net product sales, according to regulatory filings.

Acorda's Sabella told analysts on the third-quarter 2010 earnings call "approximately 75 percent of commercially-insured MS patients had no -- or limited -- prior authorizations." Only an estimated five-percent of such patients are totally blocked from receiving drug reimbursement, said Sabella.

Third-party payers -- and federal officials managing Medicare (who don't like to talk about the widening "donut hole," the coverage gap premiums paid for by the patients) -- distract from discussing it, but going forward payers will be aggressively managing the MS category to ensure cost-effectiveness. With all-member costs per share rising, look for insurers to get more aggressive in monitoring utilization patterns --- such as what MS pattern type ("relapse-remitting," secondary progressive) responds better to Ampyra drug treatment (currently unknown).

Consistent with its product label, Ampyra is being prescribed to patients with all types of MS, about 40 percent of whom were not on disease-modifying therapies.

As of September 30, the rate of "first refill" for Ampyra was 67 percent. Don't put too much weight on that fact in interpreting prescription trends, however, for this number is a weighted-average -- going back to March. In other words, we don't know how many of these early adopters are really are still on the medication.

It is on the issue of "hard endpoints" where Acorda and I diverge sharply. In the longer of two extension studies, many responders have begun to demonstrate decreases in walking speed over time. (Remember, the drug doesn't address the pathophysiology of the disease!)

Acorda likes to emphasize the impressive 35 percent improvement in walking assessment scores, such as the length of time it takes for patients to complete a 25-foot course. But in regulatory meetings with the FDA, committee members expressed concerns about the sponsor's primary endpoints and the magnitude of improvement in walking times for Ampyra-treated patients: differences of only 0.5 second and 0.88 seconds in its two pivotal trials.

"Statistics are like bikinis. What they reveal is suggestive, but what they conceal is vital."

-- Aaron Levenstein (business professor at Baruch College).

Looking to facilitate wider acceptance among insurers, providers, and patients, Acorda has shifted promotional efforts to pooled-data info showing improvements in softer endpoints, such as patient self-assessment tools.

Data on Ampyra was presented at the European Committee for Treatment and Research in Multiple Sclerosis (ECTRIMS) meeting in October 2010. Timed-walk responders showed greater improvement in 12-item multiple sclerosis walking scale scores (-6·84, 95% CI) than timed-walk non-responders.

"Walking is a critical function, and walking disability is often cited by people with MS as the most concerning aspect of their disease," said chief executive officer Ron Cohen. "This study highlights that the MSWS-12 is an important tool in evaluating how walking improvements can translate into real world benefit to patients, and that patients who respond to Ampyra can experience a clinically meaningful improvement in their walking."
CEO Cohen, however, failed to acknowledge the difficulty in interpreting the validity of self-assessment measures -- in particular, responder-shift biases:
Study participants with symptoms are more likely to participate in clinical studies than those with fewer overt symptoms or complaints. Therefore the response rate gives rise to potential exaggeration of benefits. Additionally, those who participated might be looking for validation of their 'self-assessment' improvements in hopes of receiving reimbursement or free study drug going forward.
    Behavioral scientists have repeatedly demonstrated that MS patients who volunteer to participate in blinded or open-label studies are more highly motivated. They are more likely to have a stronger sense of "self-efficacy and are likely more motivated to find effective treatments."

    Neither Acorda or lead study investigators (all of them!) would cooperate with my repeated queries or offers to note their perspectives on the merits of global self-scoring metrics. An Acorda spokesman did comment that the company preferred not to work with me, citing my past "conclusions contrary to the preferred image" for Ampyra (see related posts).

    Was it worth the FDA approving the drug? Of course it was. As said to me by a treating specialist, who preferred anonymity, "better to give MS patients hope."

    Looking ahead, the commercial success of Ampyra will be driven by managed-care and insurer reimbursement policies. The nation's biggest healthcare groups, such as Kaiser Permanente, have renewal criteria mostly dependent on improvements in hard endpoints, the "dreaded" timed-walking speed test (assessed after one to six months).

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    • David Phillips

      David Phillips has more than 25 years' experience on Wall Street, first as a financial consultant and then as an equity analyst for several investment banking firms. He sifts through SEC filings for his blog The 10Q Detective, looking for financial statement soft spots, such as depreciation policies, warranty reserves and restructuring charges. He has been widely quoted in outlets such as BusinessWeek, The International Herald Tribune, Investor's Business Daily, Kiplinger's Personal Finance, and The Wall Street Journal.