On 27 August, Amgen and Bristol-Myers Squibb (BMS) announced that Amgen had agreed with BMS’ merger partner Celgene to acquire worldwide rights to Otezla (apremilast). 

Otezla is the only oral non-biologic treatment for psoriasis (PsO) and psoriatic arthritis (PsA). The agreement is for related assets and liabilities worth $13.4bn, which includes $11.2bn in cash and $2.2bn in anticipated future tax benefits. The agreement includes the transfer of Celgene employees primarily dedicated to Otezla. GlobalData believes this to be a strategic purchase for Amgen, helping it to remain current in a fiercely competitive psoriasis market. 

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Psoriasis treatment 

Previously, BMS announced the decision to divest Otezla in connection with the ongoing regulatory approval process for the company’s pending merger with Celgene. The closing of the acquisition covered by the agreement with Amgen is contingent on BMS and Celgene entering into a consent decree with the US Federal Trade Commission (FTC) in connection with their pending merger, the closing of the pending merger, and the satisfaction of other customary closing conditions. BMS now expects the pending merger with Celgene to close by the end of 2019.

For Amgen, Otezla is a highly attractive option as it earned 2018 sales of $1.6bn. Also, Otezla is currently the only small molecule PDE4 inhibitor in the PsO market and there is little competition that will impact its sales. Amgen also owns multiple anti-tumour necrosis factor (anti-TNF) drugs in the PsO and PsA markets, namely Enbrel (etanercept) and Amgevita (adalimumab biosimilar of AbbVie’s originator drug, Humira). With the purchase of Otezla, Amgen will step closer to forming a broad portfolio in PsO. The future for Otezla is also strong as Phase III clinical studies are being conducted to investigate Otezla in mild-to-moderate psoriasis patients, which could extend Otezla’s indication to a larger patient pool, especially considering that there are currently no biologics approved for mild-to-moderate psoriasis patients. 

Furthermore, Otezla’s patent is protected until 2028, providing Amgen with an opportunity to further develop this drug ahead of generic competition. Currently, ongoing clinical trials are investigating Otezla in nail, scalp, pediatric and genital psoriasis, in addition to the mild-to-moderate psoriasis indication. 

GlobalData believes that the FTC requirement for Otezla to be divested is due to BMS’ pipeline tyrosine kinase 2 inhibitor, BMS-986165, which could be considered as a future competitor to Otezla. Furthermore, as BMS’ pipeline drug has shown strong efficacy and safety results in psoriasis patients, it could outcompete with Otezla in the future. 

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Amgen is carving its name and position into the fiercely competitive PsO market to maintain a strong position in both the current and future landscapes. Purchasing Otezla will give the company an enhanced portfolio with the potential to expand even further. It is noteworthy that Amgen has not merged with another major pharmaceutical company, an increasing trend in the field, and could sit in the shadow of larger, newly formed entities. However, with a strong and focused portfolio, they could compete against their newly merged competitors. 

Related Reports

GlobalData (2019). Hidradenitis Suppurativa – Opportunity Analysis and Forecasts to 2028, July 2019, GDHC098POA

GlobalData (2018). Psoriasis – Global Drug Forecast and Market Analysis to 2027, December 2018, GDHC173PIDR