Exclusive - Glaxo R&D boss says Advair safe from generic

Signage is pictured on the company headquarters of GlaxoSmithKline in west London July 21, 2008.

WASHINGTON (Reuters) - Potential generic rivals to GlaxoSmithKline PLC's (GSK.L) $8 billion (5 billion pounds)-a-year Advair treatment for asthma and smoker's cough can hope to capture only "a very small fraction" of its sales, the British drugmaker's research chief said on Tuesday.

Advair, an inhaler which delivers two drugs that open the lung passages and prevent inflammation that can trigger future asthma attacks and shortness of breath, is by far Glaxo's biggest product and one of the world's top-selling drugs.

"There will be generic combinations, but I don't think payers will see them as equivalent medicines," Moncef Slaoui said in an interview. "The drugs will take a very small fraction of the market."

Slaoui said Glaxo was on the rebound with a strong lineup of experimental medicines. Its earnings had taken a big hit in recent years from generic competition and safety concerns that have battered sales of its Avandia diabetes treatment.

"We now have 32 Phase III trials for 22 to 23 different indications; this is a first in the industry, I believe," he said, noting that Glaxo will release results from the trials as they become available between now and the end of 2012.

The pipeline includes new heart disease and melanoma drugs that he predicted could transform treatment.

Glaxo is developing an array of new medicines for asthma and chronic obstructive pulmonary disease (COPD) -- a term for smoker's cough and chronic bronchitis -- that should preserve its industry leadership in respiratory medicine, Slaoui said.

Slaoui, who sits on Glaxo's board and has been company research chief since 2006, was interviewed on the sidelines of the annual Bio International Convention in Washington.

His confident stance comes as industry analysts are divided on whether Advair will take a big hit from generics and whether Glaxo's new crop of respiratory drugs will keep the company out in front of rivals like Novartis (NOVN.VX), Merck & Co (MRK.N) and privately held Boehringer Ingelheim.

Advair's basic drug-substance patent lapsed in September, but patents on its delivery device extend as far out as 2016.

Even so, Sweden recently approved a generic using a device made by Greece's Elpen. Although the product is not yet available, analysts say the Swedish action could prompt other European nations to approve a generic.

Morningstar analyst Damien Conover said he expects Novartis to introduce its own generic Advair in the United States by late 2011, although he estimates only "limited sales."

As investors debate Advair's future, Glaxo is developing a follow-up combination product called Relovair, which Wall Street deems capable of generating annual sales of almost $2 billion by 2017, if it is approved.

Glaxo is confident ongoing late-stage trials will prove Relovair superior to Advair in treatment of both COPD and asthma, Slaoui said.

"It works within minutes, versus within a few hours (for Advair) and is a once-daily medicine, while Advair is twice a day," Slaoui said.

But he said Glaxo still needs clarification from U.S. regulators about what kinds of clinical data will be needed for an asthma indication.

Slaoui said one of the company's most promising experimental drugs is darapladib, which is meant to prevent the rupturing of plaque in heart arteries that can lead to heart attack and stroke. It blocks an enzyme called Lp-PLA2.

He said some Asians lack the enzyme or have a mutation in its gene that hampers the enzyme's activity, and that they have a 20 percent to 35 percent reduced risk of heart attack and stroke.

"If our drug reduces risk by a very high percentage, by 20 percent or something like that, it will be a total game changer" in treating heart disease, Slaoui said.

Another drug to keep a close eye on, he said, is a therapeutic vaccine meant to treat metastatic melanoma. It blocks two genes -- BRAF and MEK -- and has potential to become the preferred drug for the hard-to-treat skin cancer, he said.

A drug being co-developed by Daiichi Sankyo's (4568.T) Plexxikon unit and Roche Holding AG (ROG.VX) that blocks only BRAF has shrunk melanoma tumours in 60 to 70 percent of patients, Slaoui said.

He said melanoma tends to progress again, however, within about six months after anti-BRAF treatment. Glaxo is hoping to get a far longer benefit by also blocking MEK.

Shares of Glaxo were up 1.5 percent at $41.80 in midday New York Stock Exchange trading.

(Reporting by Ransdell Pierson; Editing by Lisa Von Ahn and Gunna Dickson)