Getting rid of cholesterol, that "toxin" circulating in your blood, has long been a biopharma goal. Now the battle is drawing attention on Wall Street, which sees the quest for new cholesterol treatments boosting Merck stock and shares of rivals like Novartis and the thinly traded upstart NewAmsterdam Pharma.
Statins have long been the de facto treatment for high LDL cholesterol. But new approaches could help makers of brand-name drugs tap into a market long dominated by generics. The treatments could also prove safer and more effective, lowering "bad" cholesterol for people at risk of cardiovascular problems.
"The unmet need in cardiovascular medicine remains extremely high," Bill Coyle, head of biopharma at consulting firm ZS, told Investor's Business Daily.
Merck Stock And Cholesterol Treatment
Only two in 10 people who've had a heart attack, stroke or other cardiovascular event have lowered their LDL cholesterol enough to reduce the risk of having another, says Cesar Cerezo, the U.S. medical team head of cardiovascular, renal and metabolism at Novartis.
That's why the market for cholesterol treatments is expected to boom over the next several years, a potential boost for Merck stock and Novartis stock, which are among the expected leaders of the resurgence in cholesterol drugs.
Transparency Market Research estimates the market for lipid-lowering drugs was worth $31.4 billion globally in 2022 and will hit $42.5 billion by 2031. Merck stock investors are closely watching to see if the Dow Jones stalwart could further participate in this major market.
GlobalData analyst Shireen Mohammed says the dyslipidemia market across seven major markets — the U.S., France, Germany, Italy, Spain, the U.K. and Japan — was worth $5.56 billion in 2022 and will grow to $15.53 billion in 2032. New mechanisms for treating dyslipidemia, the catchall phrase for abnormally high levels of lipids in the blood, are a key reason for the big increase, she says.
Eight late-stage drugs are in development that will hit the market between now and then, Mohammed says.
"Overall, the dyslipidemia space is set to undergo a massive shake-up during the forecast period, not just in terms of market leaders, but also in how the disease is treated," she said in a recent report.
Moving On From Statins
The Food and Drug Administration signed off on the first statin, Merck's lovastatin, in 1987. From there, a handful of statins gained approval, kicking off the war against LDL cholesterol, triglycerides and lipids.
"Statins are great drugs," Arrowhead Pharmaceuticals Chief Executive Christopher Anzalone told IBD. "We know that lowering LDL cholesterol is good. Frankly, it's probably good for everybody. I sort of view LDL cholesterol as a toxin. If you can bring that down to zero, you should."
There's a lot of money up for grabs in cholesterol treatment. Statins are generic and inexpensive. But some people can't tolerate the side effects, including muscle aches and digestive issues. Also, they're not 100% effective. Statins lower LDL cholesterol by about half and have an impact on triglycerides.
Room To Improve On PCSK9
The renaissance in cholesterol treatment began with the discovery of the PCSK9 gene. This gene provides the instructions for making a protein that regulates cholesterol in the bloodstream. Blocking that protein can lead to lower levels of "bad" cholesterol.
There are drugs that already do this, but to say their early years were a commercial slog would be an understatement.
Regeneron Pharmaceuticals and Sanofi sell Praluent, while Amgen makes Repatha. These weekly shots block the PCSK9 protein. Novartis also makes Leqvio, an every-six-months jab that silences the gene responsible for making the PCSK9 protein.
In the early days, Repatha and Praluent struggled to win insurance reimbursement due to their high prices, Rahul Jasuja, head of biopharma research at Visible Alpha, told IBD. Patients also struggled with a weekly shot for an asymptomatic condition, he said. In 2018, Amgen cut the price tag for Repatha by 60%. Regeneron and Sanofi followed suit a year later.
Meanwhile, Leqvio has missed Wall Street's sales expectations each year from 2021 — the year it launched — to 2023.
Last year, Praluent brought in $639 million in sales, trailing $1.64 billion from Repatha. Leqvio brought in $355 million. In 2029, analysts expect those sales to generate a respective $695 million, $3.49 billion and $2.49 billion, according to FactSet.
"We have seen steady growth for Leqvio since its launch and anticipate it will continue this trajectory given its (effectiveness), safety and the real-world adherence benefits seen with the convenient twice-yearly dosing," Novartis said in an emailed statement.
Merck Stock: Hogtying The PCSK9 Protein
Biopharma companies like Merck, AstraZeneca and Verve Therapeutics see room for improvement on the current PCSK9 offerings.
Merck and AstraZeneca are testing pills that block the PCSK9 protein. "PCSK9 seems to, at this point, be the most efficient target to lower LDL," Joerg Koglin, Merck's senior vice president of global clinical development, told IBD. "This is based on genetic data. It's not a surprise."
Merck has started two of its final-phase studies for its cholesterol treatment, MK-0616. The experimental drug "significantly reduced" LDL cholesterol compared to a placebo in midstage testing, the company said in a news release.
The next test results are expected in April and September 2025. The company is also running a cardiovascular outcomes study, which looks to see if MK-0616 can lower the risk of heart attack, stroke or death. The results are due in late 2029.
AstraZeneca is a bit further behind. It bought Dogma Therapeutics in 2020 for its oral cholesterol drug, another PCSK9 blocker. The company started a midstage study in dyslipidemia in the first quarter.
Turning Off The PCSK9 Protein?
Verve is exploring a different approach: gene-editing that would permanently turn off the PCSK9 gene.
The path has gotten some attention. But not all of it has been good.
Verve stock has tumbled precipitously after pausing enrollment in a study of its first-generation gene-editing treatment for high cholesterol due to safety concerns. The stock priced its initial public offering at 19 in June 2021 and peaked at 78 a few months later, but now trades near 5.
Verve is now focusing on a second-generation cholesterol treatment that uses a different — and possibly safer — means of delivering editing instructions to the genome. Chief Executive Sekar Kathiresan says the benefit of new treatments for high cholesterol will be improving patient compliance.
"The biggest question we get asked is, there are already lots of options, why do we need this?" he said in a December interview with IBD. "Theoretically, you can lower LDL in patients maybe 40% to 60%. But in the real world the (effectiveness) is 0%. People aren't on these medications."
Shares of the other two companies targeting the PCSK9 protein have been stronger. But Merck stock recently skidded after the FDA rejected its Daiichi Sankyo-partnered cancer drug. Shares broke out of a flat base with a buy point at 133.10 on June 24, according to MarketSurge. But Merck stock fell as much as 9.2% below its entry on the June 27 FDA rejection, triggering a sell rule.
AstraZeneca stock is technically inside a buy zone after breaking out of a cup base with an entry at 76.56. But shares undercut their 50-day line on July 2 — a bearish move.
NewAmsterdam: A Different Cholesterol Tact
But focusing on PCSK9 isn't the only path being explored in treating high cholesterol.
NewAmsterdam's daily pill, obicetrapib, works by blocking a protein called CETP. There have been big failures in this space. But some analysts are enthused about NewAmsterdam's approach.
The Dutch biotech went public in 2021 via a special purpose acquisition company, or SPAC, deal. Shares have gained steam and eight out of nine analysts tracking NewAmsterdam on FactSet rate it a buy.
The thinly traded stock — with average daily volume of only 145,500 shares, or $2.9 million based on the current price — is volatile on both the up side and down.
Shares soared about 114% over three weeks in January after the company laid out its strategic priorities for 2024, including the timing for its studies called Brooklyn and Broadway. Those studies of obicetrapib are expected to read out in the third and fourth quarters. In midstage testing, a combination of the NewAmsterdam drug with a generic cholesterol drug, ezetimibe, lowered LDL cholesterol by 63%.
After peaking at 26.35 on Jan. 25, the stock tumbled as much as 35% on an intraday basis over four days. Since then it has traded between 16.62 and 25 — closing Wednesday at 20.
NewAmsterdam shares got a 12% pop on March 12 after the company dosed the first patient in a study testing obicetrapib with ezetimibe in patients with high cholesterol due to a genetic defect and/or atherosclerotic cardiovascular disease.
The company also enrolled more than 9,000 patients in a cardiovascular outcomes study. The results of that study are expected at the end of 2026. That could allow the company to launch its drug in 2027.
CEO Michael Davidson says he's a big fan of PCSK9-blocking drugs. But the currently approved drugs from Regeneron/Sanofi, Amgen and Novartis are "injectable and high cost," while the experimental Merck pill must be taken perfectly in timing with food and other meds.
"These are not insurmountable hurdles," he said in an interview. "For asymptomatic conditions, patients are reluctant to take new therapies."
Arrowhead And Ionis Focus On Triglycerides
Arrowhead and Ionis are taking a slightly different tack with drugs that silence problematic genes.
In June, Arrowhead said its drug, plozasiran, reduced triglycerides by up to 80%. This led to a statistically significant reduction in pancreatitis — a symptom of a genetic condition that causes high triglycerides. The firm is also working on a drug called zodasiran in LDL cholesterol treatment.
Ionis' olezarsen blocks the APOC3 protein to lower triglycerides. William Blair analyst Myles Minter says Ionis and its subsidiary, Akcea Therapeutics, have "impressive data" for olezarsen. In one study, olezarsen reduced triglycerides by about 50%.
The results could lead to approval before year-end, Minter said in a recent report.
In comparison, Amarin's approved drug, Vascepa, lowers triglycerides by about 28%, Leerink Partners analyst Roanna Ruiz said in an April report to clients.
Novartis Stock Investors Watch Lp(a)
Experts are also starting to make the case for lowering lipoprotein A, or Lp(a).
"It has been established as an independent cardiovascular risk factor," David Song, chief investment officer for Tema ETFs, said in an interview. "It's a number that can be easily tested in (blood) serum. But it's not easy to modify through diet and exercise."
Tema holds Amgen, Novartis, Arrowhead, Verve and other cardiometabolic-focused biotech stocks in its GLP-1, Obesity and Cardiometabolic exchange traded fund.
Song estimates that around 33 million Americans have high Lp(a). Lowering this particle could have a dramatic impact on reducing the risk of heart attacks, strokes or death due to a cardiovascular event. In fact, Novartis' Cerezo says this is "the next frontier" in how researchers are targeting lipids.
Novartis, with its partner Ionis, will have the first results from an Lp(a)-lowering drug, pelacarsen. Novartis expects to have the results of that study in 2025. Other companies, like Verve through an Eli Lilly partnership, and NewAmsterdam are also looking at this.
NewAmsterdam's CEO, Davidson, notes obicetrapib lowers Lp(a) by 40% to 50%.
Coyle, the principal at ZS consulting, says drugs that lower Lp(a) will be the next big advent in cardiovascular treatments. He notes Amgen is also working in this space.
"I think this will be one of the first forays into precision cardiology," he said.
Merck Stock: Many Paths Forward
The conversation on new cholesterol drugs features other discussions. For example, there's a debate on whether injections or oral pills are the best path for treatments.
But more options are better when it comes to the myriad patients who need to lower their LDL cholesterol, experts say.
ZS' Coyle notes that patients with high cholesterol often have other conditions like type 2 diabetes, chronic kidney disease or hypertension. This makes finding the right cocktail of medicines tricky. And while some patients might prefer daily pills, "oral therapies generally have lower compliance," William Blair analyst Matt Phipps said in an April report.
For this reason, there could be many winners in the renewed battle against high cholesterol.
"Why do we need these drugs?" Coyle asked. "Because millions of people are dying every year from preventable cardiovascular risk factors. Full stop. That's the reason. We're not doing the job in attacking cardiovascular (risk)."
This story has been updated to reflect Leerink Partners analyst Roanna Ruiz's proper title as well as the timeline for Novartis' pelacarsen study in lowering Lp(a).
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
