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`Biotechnology Quarterly
`
`Industry Outlook
`
`Investors Are From Mars, The FDA Is From
`Venus
`Conclusion:
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`
`January 2011
`
`Analysts
`Phil Nadeau, Ph.D.
`(646) 562-1336
`phil.nadeau@cowen.com
`
`Eric Schmidt, Ph.D.
`(646) 562-1345
`eric.schmidt@cowen.com
`
`Ziad Bakri, M.D.
`(646) 562-1326
`ziad.bakri@cowen.com
`
`Nicholas Bishop, Ph.D.
`(646) 562-1378
`nicholas.bishop@cowen.com
`
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`
`Please see addendum
`of this report for
`important disclosures.
`
`www.cowen.com
`
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`WATSON LABORATORIES, INC. , IPR2017-01621, Ex. 1080, p. 1 of 3
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`

`

`
`
`United Therapeutics
`
`I.V. Remodulin Has Helped Take Majority Share From Flolan
`
`Like Flolan, i.v. Remodulin is delivered through an indwelling central venous
`catheter. However, i.v. Remodulin shares many of s.c. Remodulin advantages such as
`longer half-life and easier reconstitution. Our consultants continue to view Flolan as
`the gold standard of therapy, particularly for acutely and severely ill PAH patients.
`However, they also view Remodulin’s convenience profile as attractive, and some are
`transitioning patients from i.v. Flolan to i.v. Remodulin. A rapid-switch study
`evaluating conversion from i.v. Flolan to Remodulin in the outpatient setting was
`presented at the American Thoracic Society meeting in May 2006 and provides some
`additional incentive to switch.
`
`Successful completion of the subpart H study evaluating transition from Flolan to
`s.c. Remodulin has allowed United Therapeutics to broaden the Remodulin label to
`specifically include an indication for diminishing the rate of clinical deterioration in
`patients requiring transition from Flolan. In an 8-week, randomized, double-blind,
`placebo-controlled, multicenter study, patients on Flolan were switched to placebo
`or Remodulin. 93% (13 of 14) of Remodulin patients versus 13% (1 of 8) of placebo
`patients transitioned from Flolan successfully (p=0.0002).
`
`As of Q3:10, the infused Remodulin franchise was on a roughly $440MM/year run
`rate, while Flolan achieved 2009 sales of 189MM GBP (approx $300MM). Therefore,
`Remodulin has supplanted Flolan as the preferred infused prostanoid. We believe
`Remodulin will continue to claim steady market share from Flolan as clinician
`experience grows, despite the availability of a low-priced generic. We estimate
`Remodulin revenue (s.c. plus i.v.) of $413MM, $440MM, $440MM, $445MM, $450MM
`and $455MM in 2010-15, respectively.
`
`Consultants Hesitant To Use New Epoprostenols
`
`A generic epoprostenol from Teva was approved by the FDA on April 23, 2008.
`Actelion markets a thermostable formulation of epoprostenol called Veletri. It was
`approved in mid-2008 in the U.S. for the long-term intravenous treatment of primary
`pulmonary hypertension and pulmonary hypertension associated with the
`scleroderma spectrum of disease in NYHA Class III and Class IV patients who do not
`respond adequately to conventional therapy.
`
`Our consultants have been hesitant to use either. The note that IV epoprostenol is
`extremely difficult to dose correctly. If it is misdosed in a patient, or if treatment is
`interrupted, patients’ disease can worsen quickly, possibly causing the death of the
`patient. Therefore the physicians must have both confidence in the supplier of the
`epoprostenol, as well as sufficient data on how it should be dosed. Today, neither of
`the newer epoprostenols have both.
`
`Teva’s production of epoprostenol was halted, interrupting its supply. This has
`caused the physicians to lose faith in Teva as a supplier, and has caused the
`physicians to abandon it.
`
`Although Actelion’s thermostable formulation of epoprostenol could be easier to
`use than Flolan, the consultants want to see more data before adopting it. They note
`that to date there are no switch studies, and so it is unknown if the differences in
`formulation could have an effect on the dosing, safety, or efficacy. They await good,
`rigorously collected switch data before adopting it. Actelion is conducting such a
`study, with data expected during H2:2011.
`
`WATSON LABORATORIES, INC. , IPR2017-01621, Ex. 1080, p. 2 of 3
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`

`

`
`
`Flolan Sales
`
`U.S.
`Worldwide
`
`United Therapeutics
`
`Q1:08A
`10
`34
`
`Q2:08A
`9
`38
`
`Flolan (GSK) Sales (GBP MM)
`Q3:08A
`Q4:08A
`2008A
`10
`14
`43
`41
`47
`160
`
`Source: GSK
`
`
`
`Q1:09A
`13
`46
`
`Q2:09A
`11
`47
`
`Q3:09A
`9
`44
`
`Q4:09A
`14
`52
`
`2009A
`47
`189
`
`Q1:10A
`9
`43
`
`
`
`Tyvaso’s Phase III TRIUMPH Trial Lives Up To Its Name
`
`United Therapeutics developed a formulation of Remodulin called Tyvaso that is
`delivered four times (one minute per inhalation) daily via a portable nebulizer. In
`late 2007, United Therapeutics reported positive data from a 12-week, randomized,
`double-blind, placebo-controlled, multi-center Phase III study (TRIUMPH) in patients
`with NYHA Class III and IV PAH.
`
`The TRIUMPH (TReprostinil Sodium Inhalation Used in the Management of
`Pulmonary Arterial Hypertension) study was a randomized, double-blind, placebo-
`controlled trial of Tyvaso in patients with severe pulmonary hypertension. The trial
`closed enrollment in July 2007, with 235 patients. Patients were enrolled who had
`NYHA Class III or Class IV pulmonary hypertension. They could be on a stable dose
`of 125 mg bid bosentan or any stable dose of sildenafil for at least three months
`prior to the study start. Patients were to have an unencouraged six-minute walk test
`of between 200 and 450 meters at screening. Exclusion criteria included pregnancy,
`having changed or discontinued any PAH medication in three months prior to
`enrollment, and having received any investigational drug within 30 days of the start
`of the study. Patients were randomized 1:1 to either placebo or Tyvaso given four
`times per day via the Optineb nebulizer. Dropouts were accounted for using a last
`observation carry-forward method (LOCF), and any patients who died during the
`trial period were assigned a six-minute walk distance of 0 meters.
`
`Full data from the study were presented at the American Thoracic Society annual
`meeting in May 2008. The trial succeeded in meeting its primary efficacy endpoint
`demonstrating an improvement in placebo-adjusted median 6MW distance of
`approximately 20 meters (p<0.0006, Hodges-Lehmann estimate and non-parametric
`analysis of covariance in accordance with the trial's pre-specified statistical analysis
`plan). Mean baseline walk distance in the trial was approximately 350 meters. The
`trough exposure (defined as a minimum of four hours after inhalation of Tyvaso, for
`treatment change in 6MW distance at week 12 relative to baseline) was also
`significantly improved, with an increase in median 6MW distance of 14 meters
`(p<0.01). Additionally, the 6MW distance at week 6 relative to baseline was
`significantly improved, with an increase in median 6MW distance of approximately
`19 meters (p<0.0005). The trial failed to meet its secondary endpoints, including
`change in Borg Dyspnea Scale rating (shortness of breath test), NYHA functional
`class, time to clinical worsening (as defined by death, transplant, atrial septostomy,
`hospitalization due to PAH, or initiation of another approved PAH therapy), and the
`6MW distance at treatment day 1. Two measures of quality of life, the global score
`and the physical score, were statistically significantly improved with Tyvaso
`treatment.
`
`Interestingly, the effect in the primary endpoint seemed to be driven by patients on
`background Tracleer. Patients on background Tracleer had a median improvement in
`6MWD of 25m, while those on sildenafil had a median improvement of only 9m. The
`
`WATSON LABORATORIES, INC. , IPR2017-01621, Ex. 1080, p. 3 of 3
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