UPDATED: FDA still unconvinced on once-rejected diabetes drug from Bristol-Myers, AstraZeneca

AstraZeneca ($AZN) and Bristol-Myers Squibb ($BMY) are heading back to the FDA with the once-spurned dapagliflozin, claiming they've addressed the diabetes drug's cancer risks, but agency staff remains wary of the treatment's dangers.

In documents released before a Thursday advisory panel meeting, FDA reviewers acknowledged that dapagliflozin's Big Pharma sponsors have turned in a wealth of new data from humans, dogs and mice to show that the drug doesn't promote bladder tumor growth. But none of those studies can account for why 10 patients in the treatment arm developed bladder cancer compared to just one in the control group, the agency said, and the FDA is still skeptical of dapagliflozin's risk profile.

UPDATE: FDA panel smiles on Bristol-Myers, AstraZeneca's diabetes drug in do-over

"Results of these studies confirm but do not substantially extend what the FDA already concluded: that dapagliflozin by itself does not act as a carcinogen," reviewers wrote. "Any putative human bladder risk from dapagliflozin would likely be related to tumor promotion secondary to changes in the microenvironment of the bladder in vivo."

AstraZeneca and BMS's drug, part of a new class of diabetes therapies that selectively inhibit sodium-glucose transport proteins (SGLT2), did well enough on the efficacy side, posting modest but statistically significant reductions in glucose and spurring weight loss in patients with Type 2 diabetes. Still, reviewers "could not conclude with any level of confidence that the purported (cardiovascular) benefit associated with dapagliflozin use outweighed the observed imbalance in specific malignancies or potential liver toxicity risks."

That leaves the two drugmakers in a familiar spot: waiting on an FDA panel with hopes of near-term approval. Dapagliflozin flunked an agency committee back in summer 2011 before suffering FDA rejection in early 2012, as regulators and their advisers took serious issue with the drug's apparently unresolved cancer ties.

But the FDA's latest read on dapagliflozin is much more upbeat than the first one, Leerink Swann's Seamus Fernandez pointed out in an investor note, as the agency seemed satisfied that Bristol-Myers and AstraZeneca have addressed earlier concerns about breast cancer and liver toxicity. That leaves only the bladder cancer risk, and Fernandez believes the agency is not "taking an aggressive posture against dapagliflozin, suggesting to us that (Bristol) has largely resolved the key issues that should allow for approval in January."

The diabetes treatment was once expected to net around $700 million a year at its peak, but the consensus has now fallen to around $300 million, ISI's Mark Schoenebaum said in a note Tuesday.

Many feared dapagliflozin's initial rejection would cast a shadow over a whole class of SGLT2 treatments, including offerings from partner sets Eli Lilly ($LLY) and Boehringer Ingelheim and Astellas and Merck ($MRK). But Johnson & Johnson ($JNJ) had little trouble getting its SGLT2 inhibitor through the FDA, winning approval for canagliflozin, now Invokana, in March.

- read the briefing (PDF)

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