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Can Glaxo Make $1.2B Treating a Disease That Doesn't Exist?

At first glance, GlaxoSmithKline (GSK)'s new drug for Restless Legs Syndrome makes no sense at all. The medicine Horizant will only cannibalize sales of Requip, another drug for RLS that GSK launched in 2005. Requip eked out $361 million in sales last year. Not a blockbuster, sure, but a respectable business nonetheless. Why would GSK want to put that at risk?

One possible explanation -- and this is mere speculation on my part -- is that GSK is not, in fact, all that interested in treating restless legs. Rather, it's hoping for off-label sales for Parkinson's Disease and seizure disorders, which is where the big money is when it comes to drugs that are approved for RLS, a disease that many believe doesn't actually exist.

Both Requip and the other drug approved for RLS, Mirapex, are also approved to treat Parkinson's. Mirapex is best-known as a Parkinson's drug, in fact. Its maker, Boehringer Ingelheim, is privately held and thus Mirapex sales numbers are hard to come by. But in 2008 Mirapex may have made $477 million in revenues.

The other head-scratcher about Horizant (which used to be called Solzira) is that it will face competition from cheaper, generic versions of Requip -- often the kiss of death in the drug business. GSK's logic here seems to be that because Horizant (gabapentin enacarbil) is a different chemical from Requip (ropinirole) it can convince doctors, pharmacy benefit managers and insurers that it is superior and/or different to Requip, and therefore worthy of reimbursement at a higher price.

Gaba-gaba-hey!
But then you have to consider that as a variant of gabapentin, Horizant will face even stiffer competition from cheap versions of Neurontin, the king of generic gabas, which treats seizure disorders, pain, and a "witch's brew" of other off-label conditions.

And this, I think, is where GSK sees an opportunity. In addition to back-door sales from Parkinson's users, GSK may also get some add-on sales from doctors looking to give patients an extended release version of plain-jane Neurontin. Because that is what Horizant/gabapentin enacarbil actually is -- an extended release version of gabapentin with twice the bioavailability of the original drug. The sales case for that type of product is much more promising than an RLS treatment. In 2008, years after Neurontin went generic, Pfizer (PFE) still earned $387 million from the drug.

Put those numbers together -- Requip's $361 million in sales, Mirapex's $477 million and Neurontin's $387 million -- and you have a drug category worth about $1.2 billion.

Now we are talking real money -- very little of it in restless legs.

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Image by Flickr user AA, CC.