Device/Drug Combinations in Ophthalmology
Author: Dr Akmal Bhatti – Director Strategy Consulting
Wild et al have recently published data on global diabetes prevalence (Diabetes Care, Vol 27, Number 5, 1047-1053, 2004) which paints a stark picture of the increasing challenge to the medical profession in treatment of this condition. As the table opposite shows, the total number of people with diabetes is expected to more than double from the year 2000 figure of 171.3m to somewhere in the region of 366m by 2030. As well as the increasing ageing population contributing to this increase, risk factors such as obesity and the physical inactivity that comes with it will also be factors driving this trend.
Table 1. Diabetes Prevalence – Global and select European countries.
Source: Wild et al, Diabetes Care, Vol 27, Number 5, 1047-1053, 2004
Apart from the daily need to monitor and control blood glucose levels diabetes sufferers are likely to be faced with having to deal with a number of complications of the condition. One of the most unfortunate of these is the threat of blindness. The commonest cause of vision loss from retinal damage in diabetics is macular oedema in which the central retina (referred to as the macula) absorbs fluid that leaks from damaged capillaries. It is difficult to make an early diagnosis of macular oedema although regular ophthalmic examinations of the retina may allow an ophthalmologist to recognize the development of disease- related declines in visual acuity. If this is not possible then the result is that retinal damage increases to a point where it becomes irreversible.
As well as macular oedema diabetics may experience loss of vision due to the abnormal growth of blood vessels at the back of the eye which slowly leak blood into the centre of the eye causing retinal damage in this way. Research has shown that at any time 10% of diabetics will develop this diabetic retinopathy necessitating ophthalmologic intervention and treatment. The annual incidence of retinopathy requiring ophthalmological follow up or treatment has been reported to average 1.5% after one year. Untreated, between 6-9% of diabetics with proliferative retinopathy or severe non-proliferative disease will become blind each year.
When one considers the elderly population, the threat of blindness again increases with age. A major reason for the development of blindness in the elderly is the onset of a condition called age-related macular degeneration (AMD). There are two forms of AMD, atrophic (dry) or exudate (wet) with patients diagnosed with the atrophic form developing the wet form of the disease with time. The wet form of AMD accounts for only 10-15% of AMD but nevertheless accounts for over 90% of the cases of AMD-related blindness. Just as in diabetic macular oedema and diabetic retinopathy AMD is characterized by neovascularization in the macula. The growth of blood vessels in this region has been identified as being caused by hypoxia which turns on vascular epithelial growth factor, VEGF. The effect of this is increased neovascularisation and exacerbation of the condition.
Unsurprisingly, efforts within the pharmaceutical sector have begun to focus on anti-VEGF therapy for the back of the eye diseases such as AMD in particular. However, the medical device sector is set to have an important impact in the ophthalmology sector and HBS Consulting believes that this area has the potential to create a multibillion dollar opportunity for medical device/drug combination products which, when they prove superior to pharmaceutical treatments will surpass what has been seen in the cardiac drug eluting stents sector.
Pharma involvement validates the market opportunity
Current treatment options for wet AMD are fairly ineffective. Photodynamic therapy is only useful in a small subset of patients and the effects of treatment are limited. There are perhaps three key products in the pharmaceutical pipeline, Genentech’s Lucentis, Genaera’s Squalamine and Eyetech’s Macugen. Treatment with each of these products would require regular injections of drug, periodical intraocular injections with Lucentis and Macugen and periodical IV therapy with Squalamine (see table below for anticipated dosing schedules). Eyetech is being touted as the market maker with first mover advantage. Eyetech anticipates approval and launch in the first half of 2005 of what would be the first drug to treat the disease.
In the pharmaceutical area Pfizer signed an agreement with Eyetech Pharmaceuticals in December 2002 to jointly develop and commercialise Eyetech’s product Macugen for the wet form of AMD and diabetic macular oedema. The details of the deal represents a significant opportunity for Eyetech Pharmaceuticals. Pfizer paid Eyetech $75 million upfront and bought $25 million in the firm's equity. It also pledged to purchase another $25 million in equity, which It partially satisfied by buying $10M in stock concurrent with Eyetech's January 29, 2004 IPO. The deal could net Eyetech up to $195m in approval milestones and up to $450m in post approval milestones. The total deal value underscores the potential that companies see in this area. Similarly, investors have caught on. The Eyetech IPO raised $157m. On May 26th 2004 Eyetech announced that an advisory panel to the U.S. Food and Drug Administration planned to review its application for Macugen on August 27 2004. The effect of this news was an increase of 18% in Eyetech shares as analysts noted that the FDA usually follows the advice of its advisory panel in deciding whether to approve a drug or therapy. Regardless of the timing of launch the heightened activity within the biotechnology and pharmaceutical sectors and the commitment of companies such as Pfizer suggests that the market will open up rapidly. If device manufacturers can initiate shrewd sales and marketing strategies the targeted delivery and improved compliance possible with drug/device combinations could surmount barriers to dominance in the sector that will be placed by pharmaceutical company involvement. Minimally invasive surgical implants such as those being developed by Surmodics can deliver drugs to the eye much more effectively than through systemic or intraocular injections.
Table 2. Drug and Drug/Device therapies for ophthalmologic applications
AMD Market Opportunity
Taking the opportunities in treatment of wet AMD alone, HBS Consulting research suggests a market opportunity in Western Europe of at least $2.7bn and of at least $1.5bn in the USA by 2010. These figures are based on yearly treatment costs of $5000 and treatment of 50% of wet AMD sufferers eligible for treatment.
The $5000 cost of an implant is a suggested price for a drug/device combination versus an anticipated minimum $7000 to $8000 yearly course of drug treatment. The cost of drug eluting stents is around $3500. Cost of Visudyne treatment is $5000. If these figures were to be considered indicative of the forward scenario in this market, the cost- benefit and improved patient compliance afforded by drug/device combinations could persuade relevant government bodies to approve guidance for the device option versus the drug option for wet AMD treatment in the key global markets. In general, HBS Consulting finds that the area of drug/device combinations is a fascinating area worthy of continual investigation and monitoring in light of the expanding applications and revenue generating potential.
Table 3. AMD market opportunity, global and selected countries.
