Dermavant faces a perfect storm of pressures for tapinarof, but there is hope for the psoriasis drug – FiercePharma

Dermavants tapinarof launch will need to withstand some turbulence, but it still has a chance of breaking through the atmosphere.

This is according to analysts at Jefferies, who forecast stormy weather ahead for the topical psoriasis drug that is looking for a second-quarter approval and a swift launch.

There is a troika of challenges on the horizon for tapinarof. First, COVID: The pandemic is not over, as omicron has reminded us, and this will continue the pressure we have seen on all drug launches.

Jefferies notes that the COVID chaos means many launches have disappointed even from large cap biotechs and pharma, so dont be surprised if Dermavanta small biotech that's part of the Roivant cluster of biopharmasalso ends up struggling.

RELATED: Arcutis' topical cream hits goal in psoriasis phase 3, setting up FDA filing and market showdown

The psoriasis market is already a competitive and a tight one, with high efficacy biologics from several Big Pharmasincluding the $20 billion-a-year Humira from AbbVieJohnson & Johnsons Remicade and its biosimilars along with newer follow-up drugs like Skyrizi and Tremfya. That all combines to put significant pressure on any new drug entry.

Third, Jefferies says that when you look back, past topical launches have generally looked mixed. Older topical creams for the condition include Bausch Healths Duobrii and Almirall/MC2s Wynzora, with the former making just $88 million in 2020 (and the latter only nabbing approval in mid-2020 and yet to report full-year sales).

Jefferies sees tapinarof revenue this year hitting $10 million at the high end, should it launch around mid-2022, and ramping up to $50 million in 2023 for its psoriasis label.

But Dermavant is clearly focused on a strong trajectory and is currently building out a sales team, adding 75 to 100 reps and looking to strengthen market access over the next few months, the analysts said in a note to clients.

Dermavant forked over 150 million pounds sterling ($198 million) upfront in 2018 to get its hands on what was then GlaxoSmithKlines phase 3-ready psoriasis cream. Since then, Dermavant ran its own tapinarof trials, which have broadly shown efficacy, but it's hoping the big win will be on safety.

The current crop of blockbuster psoriasis and plaque psoriasis biologics all need injecting, and the systemic nature of these drugs can lead to immune system-related side effects. A topical cream should, in theory, be safer overall.

RELATED: Dermavant shows deepening effects of tapinarof on psoriasis ahead of FDA filing

But Dermavant already has topical rivals waiting in the wings. Arcutis Biotherapeutics is also anticipating an FDA decision this yearJuly 29, to be exactfor its hopeful ARQ-151, a topical formulation of the PDE4 inhibitor found in AstraZenecas chronic obstructive pulmonary disease treatment Daliresp.

There are also pills for psoriasis on the market, including Amgens Otezla, another PDE4 inhibitor that it bought from Bristol Myers Squibb in 2019.

And then there's Bristols own oral follow-up to that drug, deucravacitinib, a TYK2 drug and a member of the JAK family.

Pfizers Xeljanz, as a JAK inhibitor, is facing the same scrutinyand was all the way back in 2015 slapped with an FDA complete response letter for its oral psoriasis med, with the Big Pharma later giving up on getting it approved for that indication.

Dermavant's new sales team will have to chart a difficult course but will hope to rise to the challenge.

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Dermavant faces a perfect storm of pressures for tapinarof, but there is hope for the psoriasis drug - FiercePharma