Don’t Get Too Excited About PTC Therapeutics (Yet)

PTC Therapeutics (NASDAQ: PTCT) shares took off after updated data from a trial evaluating risdiplam suggested it could mount a stiff challenge to Biogen‘s (NASDAQ: BIIB) and Ionis Pharmaceuticals(NASDAQ: IONS) Spinraza for the treatment of spinal muscular atrophy (SMA), a rare and life-threatening genetic disease. The data is solid, but a one-and-done SMA treatment is already in late-stage studies at Novartis(NYSE: NVS), and that therapy could become available as soon as 2019.

What’s SMA?

Diagnosed in infants, a faulty survival motor neuron 1 (SMN1) gene in SMA patients fails to produce adequate levels of SMN, a protein critical to motor neuron survival. Absent SMN, the neurons controlling muscles in the spinal cord die, and over time, resulting muscle atrophy causes patients to lose the ability to walk, eat, and breathe.


Using age of onset and disease severity, SMA is broken out into three types.

Type 1 SMA is diagnosed in 60% of SMA cases. Usually diagnosed within a baby’s first six months, SMA type 1 the most severe and life-threatening type of the disease. About 90% of type 1 patients die or require permanent ventilator support by age two.

Type 2 SMA is usually diagnosed between six months to 18 months of age. Accounting for 27% of SMA cases, patients with SMA type 2 are unable to walk or stand without help and sadly, 30% of type 2 patients succumb to their disease by age 25.

Diagnosed in childhood or early adulthood, SMA type 3 patients have the best prognosis, but they still endure significant challenges to quality of life, including eventually losing the ability to walk. Type 3 SMA accounts for 13% of SMA cases.

Treatment advances

Unfortunately, there’s no cure for SMA; however, Biogen and Ionis won FDA approval of Spinraza in December 2016, and because Spinraza improves motor function, it’s become a billion-dollar blockbuster.

Spinraza doesn’t attempt to fix production of SMN by the SMN 1 gene. Instead, it tinkers with survival motor neuron 2 (SMN 2), a backup SMN gene that produces less than one-tenth of the SMN produced by SMN 1. By binding to a specific part of RNA, Spinraza increases SMN 2’s production of SMN, thus, improving motor neuron function.

In trials, 40% of Spinraza patients saw an improvement in motor milestones based on the Hammersmith infant neurological examination (HINE), section 2, which assesses developmental milestones, including head control, standing, and walking. For comparison, none of the patients in the control arm of Spinraza’s study saw such an improvement.

Although Spinraza is revolutionary, it doesn’t help everyone, and that leaves the door open to competitors, including PTC Therapeutics, which is developing risdiplam with Roche Holdings (NASDAQOTH: RHHBY) under a licensing pact the two companies inked in 2011.


On Monday, PTC Therapeutics unveiled data from a risdiplam trial showing it raised the median Children’s Hospital of Philadelphia Infant Test of Neuromuscular Disorders (CHOP-INTEND) score by 5.5 points at day 56, 12.5 points at day 119, and 14 points at day 182 of treatment from baseline.

According to researchers, 75% of patients achieved a four-point or bigger increase from baseline on CHOP-INTEND at day 56, 94% of patients achieved that level of improvement at day 119, and 91% achieved that level of improvement at Day 182.

That’s impressive data, especially when you consider that only 63% of Spinraza patients saw a four-point or better improvement in CHOP-INTEND at day 183 in trials, yet it’s become one of the best-selling rare-disease drugs on the planet.

Investors could be a little too excited about risdiplam’s commercial opportunity, though. That’s because risdiplam and Spinraza could both end up being bested by Novartis AVXS-101.

Earlier this year, Novartis acquired AveXis for $8.7 billion to land AVXS-101, a potential one-and-done gene therapy for SMA. Using technology licensed from RegenXbio (NASDAQ: RGNX), one dose of AVXS-101 could restore SMN production by inserting a functioning copy of the missing or mutated SMN gene in motor neurons.

In trials, every one of 15 infants treated with AVXS-101 were alive and without the need for permanent ventilation at the 24-month mark. Historically, that only happens in about 8% of SMA patients. Using the CHOP-INTEND system, patient scores increased by an average 7.8 at one month, and by 17.3 at three months.

That data’s so good that Novartis plans to file for FDA approval of it soon, and that could mean AVXS-101 is available as early as next year.

What’s next?

Spinraza’s sales were $364 million in the first quarter of 2018, so there’s a lot at stake for these companies. It’s possible PTC Therapeutics’ oral dosing and efficacy give it an advantage over Spinraza, but there’s also a possibility that AVXS-101 captures the majority of this market.

That possibility is even greater now that a phase 3 trial evaluating AVXS-101 in type 1, type 2, and type 3 patients has begun enrolling patients. If that trial confirms AVXS-101 is effective in all three SMA types, then AVXS-101 could become standard treatment. For that reason, I’m unwilling to buy PTC Therapeutics shares despite its good news until I get more insight into Novartis’ progress.

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Todd Campbell has no position in any of the stocks mentioned. His clients may have positions in the companies mentioned. The Motley Fool owns shares of and recommends Biogen and Ionis Pharmaceuticals. The Motley Fool has a disclosure policy.

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