UK pharmaceutical company, AstraZeneca (AZ), and US biotechnology company, AtheroGenics, has failed in a late stage clinical trial" /> UK pharmaceutical company, AstraZeneca (AZ), and US biotechnology company, AtheroGenics, has failed in a late stage clinical trial" />

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AstraZeneca pipeline heart drug fails in late-stage trials

AGI-1067, a pipeline vascular protectant heart drug co-developed by UK pharmaceutical company, AstraZeneca (AZ), and US biotechnology company, AtheroGenics, has failed in a late stage clinical trial

AGI-1067, a pipeline vascular protectant heart drug co-developed byUK pharmaceutical company, AstraZeneca (AZ), and US biotechnology company, AtheroGenics, has failed in a late stage clinical trial.

The drug did not meet the primary endpoints of the phase III, 6,000 plus patient trial, which included lowered death rates, decrease in heart attack, stroke, bypass surgery, angioplasty and chest pain requiring hospitalisation.

The success of AGI-1067 was vital to the continued development of AtheroGenics, which does not have any other marketed products. AZ had agreed to pay up to USD 1bn (EUR 752.2m/ GBP 514m) for an exclusive global license.

AGI-1067 was intended to reduce arteriosclerosis by combating inflammation. Had the drug succeeded in the phase III trials, it could have racked up yearly sales of USD 5bn. AZ was relying heavily on the successful progression of the compound since the failure of stroke drug, NXY-069, back in October 2006.

Although AZ has spent only approximately USD 50m to date on the collaboration, analysts have criticised the company's ability to in-license drugs successfully and bring them to market.

Russell Medford, AtheroGenics' CEO, said in an investor meeting that AZ had 45 days to decide if AGI-1067 warrants further development. Medford added that AtheroGenics had the necessary financial resources to move the compound forward, explaining that the company had cash reserves of more than USD 150m from the start of 2007.

Analysts believe this will not happen, however, saying that the development of drugs that reduce arterial plaques, compared with those which slow their development, has not been successful historically.

AtheroGenics said that trial data met some secondary endpoints, however, and appeared to reduce heart attacks, death and stroke. The data will be presented on 27 March 2007 at the American College of Cardiology Scientific Session in New Orleans. Medford added that his company was in talks with the FDA regarding potential uses for the drug once the secondary endpoint data are examined.

On 19 March after the news of the trial results, the stock of AtheroGenics fell USD 4.62 to rest at USD 3.21 after a low of USD 2.90 on NASDAQ, while AZ shares lost 1.3 per cent to rest at GBP 28.41.

In other news, the expected mid-2007 US market launch of AZ's asthma treatment, Symbicort, which is already a blockbuster in Europe, could be impacted by the fact that sales of GlaxoSmithKline's (GSK) asthma treatment, Advair/Seretide, could continue to grow in that market. Positive study results revealed that the treatment significantly reduced the frequency of COPD-related events by 25 per cent, as well as improving lung function over three years. The study results and expanded indications will make market penetration for Symbicort more difficult.

AZ announced FY06 operating profits up 28 per cent to rest at GBP 4.2bn, while operating margins rose 31 per cent. Combined sales of key drugs rose by 23 per cent to GBP 6.8bn. Key drugs include anti-ulcerant Nexium (esomeprazole), Seroquel (quetiapine) for schizophrenia and Arimidex (anastrozole) for early-stage breast cancer drug, along with cholesterol lowering drug, Crestor (rosuvastatin).

AZ has also recently revealed it will axe 3,000 jobs over the next three years, due to declining sales two of its top selling products, Nexium and Seroquel, which face attacks from generic competitors. Analysts still think AZ has a weak pipeline of drugs in development, despite its flurry of 12 licensing deals and acquisitions in 2006, as well as nine research agreements with biotechnology firms. AZ also announced a GBP 2bn (EUR 3bn/ USD 3.9bn) share buy-back programme for FY07.

21st March 2007

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