There is good potential in two of Lundbeck’s drug candidates from its own pipeline as the Danish pharmaceutical company tries to fight the patent expiry that threatens the currently well-oiled machine later this decade.

This is the assessment of Søren Løntoft Hansen, senior analyst at Sydbank. 

He also sees a good chance that Lundbeck might make it all the way through the eye of the needle with both Lu AF82422 for the treatment of Parkinson’s disease multiple system atrophy (MSA) and Lu AG09222 for the prevention of migraines. 

Regarding the latter, Lundbeck announced on Friday that the development will proceed to phase 2b. 

Aiming to have proprietary products on the market by 2030

Lundbeck has an ambition to bring two proprietary products all the way to market within the current decade, and it is these two products that seem to be the best cards for the pharmaceutical company. 

”They are each in their own way significant potentials,” Søren Løntoft Hansen tells Marketwire. 

”There are no treatments for MSA right now. It is of course difficult to see what the market potential is, but in terms of patient population and potential pricing, it is an estimate in the range of USD 1.5-3.0b for the market,” he continues. 

Lundbeck has recently revealed results from a Phase II study with LU AF82422, which did not show statistically significant improvement in MSA, but was still satisfactory enough that Lundbeck, after dialog with health authorities, has decided to take the development to Phase 3. 

”It was a study that was not designed to show statistical significance, but what Lundbeck has shown is actually very encouraging. The company is so positive about the data that they are comfortable moving forward, and this is a disease where there are no treatment alternatives,” says Søren Løntoft Hansen. 

”This probably also makes it a little easier to get through the eye of the needle,” he continues.

Migraine prevention is gaining ground right now

In relation to the other drug candidate, Lu AG09222, which Lundbeck acquired in connection with the acquisition of Alder Pharmaceuticals, from which the strategic key drug Vyepti also came, the market is also buzzing right now. 

The drug candidate is an antibody treatment targeting the neuropeptide PACAP, and it is the first drug candidate to make it through Phase II in this particular area. 

”The migraine market is a market that is really taking off right now. New therapies have gained ground in the prevention of migraines. Previously, it has been a market where prevention has not been a major focus,” says Søren Løntoft Hansen. 

He estimates that migraine prevention will probably also be a low single-digit billion dollar market by the end of the 2020s. 

Unlikely to stand alone

However, even if the two drug candidates were to eventually reach the market and generate real revenue for Lundbeck, it would likely not be enough to make up for the patent expirations the Danish company is facing. 

This is why Lundbeck has long talked about the likelihood of a combination of acquisitions and in-house development. 

It is also why the share structure of the company was changed in the summer of 2022 to two classes of shares, so that the Lundbeck Foundation has better opportunities to support acquisitions without relinquishing its ownership stake. 

’They can hardly stand alone and compensate for patent expiry. So I still see a Lundbeck that will buy up in the coming years if the opportunities are there,” says Søren Løntoft Hansen. 

’And finding those opportunities is perhaps the biggest problem. But I still see it as a necessity, and with the solid financial foundation that Lundbeck has and the solid cash flows they generate, they also have the ammunition to make them,” he continues.