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GlaxoSmithKline’s woes with Avandia® (rosiglitazone) could well get worse following the news that the firm faces a lawsuit over claims that it misled shareholders and withheld information about the safety of the diabetes drug.
Law firm Kaplan Fox and Kilsheimer says it has filed a class action suit in the US District Court for the Southern District of New York against GSK on behalf of anyone who bought securities between 27 October 2005 and 21 May this year, alleging that the firm publicly issued “a series of false and misleading statements” regarding Avandia.
In particular, the complaint alleges that GSK failed to adequately disclose the fact that it had performed a meta-analysis related to Avandia which showed an increased risk of heart attack. Preliminary results of this analysis were presented to the FDA in September 2005 and updated results were disclosed to the agency in August 2006 but “were never adequately disclosed to the investing public”.
This disclosure only happened two weeks after the New England Journal of Medicine published a meta-analysis by Dr Steven Nissen which suggested the drug might significantly increase the risk of heart attack. Once the latter became public, shares at GSK, which has yet to respond to the lawsuit, went through the floor.
On a much brighter note for GSK, the firm said that alli® (orlistat), the only FDA-approved over-the-counter weight-loss product, and which is lower-dose version of Roche’s prescription drug Xenical®, will be on the shelves of pharmacies, grocers’ and mass merchandisers across the USA later this week.
The product will retail for $55–60 for a month’s supply and the launch is expected to be one of the biggest for an OTC treatment. Analysts expect GSK to spend around $150m on US marketing this year alone but this could prove to be a shrewd investment. Backed by clinical trial data that shows it can lead to weight loss of five to six pounds over six months, alli could quickly become a leading brand with sales of more than $1bn.
GSK is expected to roll out the product next year and regulatory approval in Canada, Latin America, China, Australia and New Zealand will be sought before the end of 2007.
GSK has also announced that the FDA has granted a priority review to a capsule form of its oncology agent Hycamtin® (topotecan), a topoisomerase I inhibitor, for treating relapsed small-cell lung cancer. This means the agency will make its decision on whether to approve the drug within six months, rather than the usual 10–12 month review period.
GSK noted that Hycamtin in its current intravenous formulation requires five consecutive days’ therapy every three weeks, while the capsule, if approved, will allow patients to be treated at home.