Media release from Datamonitor

Melbourne, 28th July 2010 - Decisions from US and European regulators on the use of Allergan's Botox (onabotulinumtoxinA) for the prophylactic treatment of chronic migraine are eagerly anticipated following UK approval this month. However, independent market analyst Datamonitor suggests that approval is far from guaranteed and assuming a positive outcome, reimbursement challenges will provide Allergan with an ongoing headache.

Martin Adams, healthcare analyst at Datamonitor comments that "Approval in the UK for Allergan's Botox (onabotulinumtoxinA) for the prevention of chronic migraine bodes well for the US and other EU filings but even so there remain significant hurdles for the company to overcome."

Under direction from the UK Medicines and Healthcare Products Regulatory Agency (MHRA), Botox will only be available for patients who suffer headaches for at least 15 days a month, half of which must be attributable to a migraine. However, it is widely acknowledged that Botox is unlikely to be effective in all patients experiencing chronic migraine, and predicting which patients will respond favourably to the treatment will undoubtedly represent a significant and expensive challenge for physicians. Furthermore, the drug also failed to meet the primary efficacy endpoint in the first Phase III trial and, whilst generally perceived to be safe, has the potential to cause serious life-threatening side effects.

Martin adds: "With the first clinical trial essentially failing, there remains a prospect that Botox will not be approved in the US and remaining EU countries. However, a significant level of support exists amongst opinion leaders, particularly so in the US and it does address a high unmet need among the target patient population."

With three to four sessions required per year and each costing approximately $750 (not accounting for physician and clinic costs) the majority of insurance policies currently do not cover the use of Botox for chronic migraine. However, even if formal approval is achieved, Datamonitor believes that reimbursement would pose a significant challenge for Allergan. Furthermore, while the UK's MHRA approval is a significant milestone, Allergan may yet face difficulties in selling the product unless or until the National Institute for Health and Clinical Excellence (NICE) considers whether Botox offers value for money in this patient population.

Martin adds: "If it is approved then the high associated costs will also see reimbursement restricted."

The migraine market value has plummeted by over $1.5 billion dollars over the past year as two leading brands experienced considerable genericisation following US patent expiry in early 2009. Promising first-in-class developments, including Botox and Merck & Co's calcitonin gene-related peptide (CGRP) receptor antagonist telcagepant (MK-0974) will be key in returning this value.

If approved in the US, Japan and remainder of the 5EU, Datamonitor expects Botox to achieve peak seven major market migraine-specific annual sales of $392m by 2019.