Merck's allergy pill clears an FDA hurdle, but efficacy questions linger

Merck ($MRK) convinced a panel of FDA advisers that its oral grass allergy immunotherapy could successfully reduce symptoms, but the pill may well face an uphill battle if it can make its way onto a market dominated by effective injections.

The committee voted unanimously in favor of the safety and effectiveness of Grastek, skipping over some earlier concerns but recommending that Merck run a postapproval study to keep an eye on risks to patients between 5 and 11. The drug, licensed from ALK-abello, is an immunotherapy that uses extracted timothy grass pollen to gradually dull a patients' allergic reactions, and the partners hope to contend with the commonplace shot regimen that has become a standard therapy for severe sufferers.

The panel's nod likely spells a down-the-line approval for Grastek--the FDA quite often follows the recommendations of its advisers--but it doesn't necessarily mean a payday for Merck. In its pivotal studies, the pill beat out placebo in reducing symptoms by about 20%, but Merck's real challenge will come in convincing allergists to shift patients from tried-and-true shots to a new drug.

And that may not be easy, because while shots are inconvenient and can't be done at home, they're cheap and well-trusted. Analysts are less than optimistic Merck can make much headway with its pill, and the consensus peak-sale estimate is around $150 million a year, according to ISI's Mark Schoenebaum.

Meanwhile, France's Stallergenes is in a similar boat with its own grass allergy treatment, winning a resounding recommendation from the same panel on Wednesday for the immunotherapy Oralair. Unlike Merck's pill, which treats only timothy grass allergies, Stallergenes' drug also helps with Kentucky blue, orchard, perennial rye and sweet vernal. Both treatments are already on the European market.

The last two meetings of the FDA's allergy drug panel are a month late, rescheduled after the fall's government shutdown forced the agency to furlough many of its employees. That delay is unlikely to mar Grastek's path to market, however, and the partners expect to get a final FDA decision in the first half of 2014.

"We believe Grastek has the potential to be an important new oral therapeutic option for allergy specialists and their patients who continue to suffer with timothy grass pollen-induced allergic rhinitis," Merck Respiratory and Immunology Vice President Sean Curtis said in a statement, "and we look forward to continuing to work with the FDA as the agency completes its review of our biologics license application for Grastek."

- read ALK's announcement
- here's Merck's statement
- get more from Stallergenes