There's an important shift going on at the FDA that is making me more cautious on biotech companies working on cancer drugs. On December 5, Genentech (DNA) got a turndown from the FDA Oncologic Drugs Advisory Committee (ODAC) to expand the label for Avastin to cover breast cancer patients in conjunction with chemotherapy. Avastin is already FDA-approved for colorectal and lung cancer, and it is no small drug, doing $1.7 billion in sales for the first nine months of 2007. This got my attention, because Genentech normally is very good at getting drugs through the FDA. But the head of the Oncology Division of the FDA, Richard Pazdur, has become very strong politically, to the point that industry insiders now refer to some FDA decisions as "being Pazdurized."
On Avastin, he simply constructed the ODAC panel meeting to get a "no" vote, using the always-reliable "let's wait for more data" excuse. Some people think that the FDA will overrule the panel and approve Avastin on February 23 because the vote was only 5 to 4 against approval. But I think they are really wrong, for two reasons. First, as Pogo used to say, truth is a 5 to 4 vote by the Supreme Court. Second, Pazdur has an agenda. In the past, progression-free survival has been a surrogate endpoint for survival, and a drug that showed progression-free survival for a period of time could get approval. But Pazdur seems to want real survival data, which can take much longer to collect at a point that it will be statistically significant. Essentially, he has said: "I don't care if the tumors stop growing if the drug doesn't extend survival, so show me the survival data."
I have mixed feeling about this. None less than the American Cancer Society has said that if you have a healthy immune system, you won't get cancer. In that sense, cancer is a symptom of an unhealthy immune system, not a disease in itself. Treating the tumor without treating the underlying immune system problem is like bringing a fever down without addressing an underlying infection. It doesn't do much good, and may actually do harm. In the case of the fever, your body is trying to burn out the source of the infection. In the case of cancer, chemotherapy and radiation both suppress the immune system, making it more likely that cancer will recur and be fatal.
On the other hand, this is bad news for cancer biotech companies and their stocks, and may reduce R&D in this area. It simply takes a lot more money and time to prove survival than to prove tumors are not progressing. So a new approach that works might not get pursued just because of the daunting financial requirements to get to approval. In all, we must factor these developments into our decisions to invest in biotech cancer companies going forward.
