Genzyme write-off due to plant shutdown increases to at least $22.6 million.
The EMEA issued new temporary treatment recommendations for Genzyme’s Gaucher’s disease therapy, Cerezyme. The tighter treatment control follows the company’s confirmation that shortage of its drug is more severe than previously expected.
In June Genzyme had to shut its Cerezyme production site in Allston Landing, MA, due to viral contamination. The additional shortfall relates to its decision in late July to also discard some 80% of the work-in-process material.
Under the new European recommendations, adult and paediatric patients with the greatest need for Cerezyme should receive reduced dosages of the drug, or less frequent infusions. Adult patients without severe, life-threatening disease should receive alternative treatment.
Genzyme’s decision in late July to discard the majority of its work-in-process material means that the total second-quarter write-off has risen by another $8.4 million to approximately $22.6 million. The firm says that it now expects its 2009 Cerezyme revenues to be at the low end of the $750 million–$1 billion guidance range reported in July. Moreover, if the company does not finish and release any of the remaining 20% of work-in-progress material, it will incur an additional write-off of some $2.7 million.
Genzyme is also currently in discussions with regulatory authorities regarding the release of two lots of Cerezyme that were finished before the plant was shut down. If these finished goods are not released, it will have to shoulder another write-off of $3.1 million.
On August 10 Genzyme confirmed that manufacturing at Allston had resumed. It said that half its bioreactors were up and running, and the rest are expected to be operational this month. The company hopes to begin releasing new material from these production runs in November and December.
In the U.S., Genzyme implemented a dose-conservation program last week. The firm is now shipping Cerezyme only to patients with Gaucher’s disease type 1 who are 18 years of age or younger and to all patients with Gaucher’s types 2 or 3. An emergency access program means physicians can also apply to receive Cerezyme for patients who are in life-threatening situations.
FDA has also asked Protalix Biotherapeutics and Shire to submit treatment protocols for their late-stage investigational therapies, which if accepted would release these candidates to patients. Shire’s velaglucerase recently showed positive Phase III results.
The Allston site also manufactures Genzyme’s Fabry disease treatment, Fabrazyme. Shipments of Fabrazyme were not restricted following the shutdown of the Allston plant, and dose-conservation guidelines for the drug are in place worldwide to preserve supply during the anticipated six–eight week period of constraint. Product shipments are expected to resume in November and December. Genzyme previously adjusted its Fabrazyme revenue guidance for this year to $510–$520 million from the previously estimated $560–570 million.
Construction reportedly continues on an additional manufacturing facility for Cerezyme and Fabrazyme in Framingham, MA. The plant is expected to be mechanically complete by the end of this year, and engineering and process validation runs will take place next year. Regulatory approval is expected in mid-2011. This plant, which will include four 2,000 L bioreactors, will provide substantial additional capacity both to create ample backup inventory and to support the growth of the two products. Genzyme says that it has hired approximately 100 people to complement existing staff associated with the start-up of this facility.