US FDA approves Bristol Myers' schizophrenia drug

By Bhanvi Satija and Michael Erman

(Reuters) – The U.S. FDA approved Bristol Myers Squibb's schizophrenia drug on Thursday, giving patients a treatment option that relieves symptoms of the mental disorder without common side effects.

Bristol Myers got the drug Cobenfy, also known as KarXT, through its $14 billion acquisition of Karuna Therapeutics last year. The drugmaker is betting the treatment will boost growth as patents on its older cancer drug Revlimid and blood thinner Eliquis expire later this decade.

William Blair analysts expect U.S. sales for the drug to reach $2.5 billion by 2030. Bristol shares rose 4% in extended trading.

Bristol said it expects to make the drug available to patients by the end of October at a list price of $1,850 per month, or about $22,500 per year.

The FDA approval was based on data from two studies in which patients taking the drug experienced significant reductions in symptoms. The drug is the first approved antipsychotic to target cholinergic receptors, as opposed to dopamine receptors, which have long been the standard treatment.

“So there is still an unmet need in the treatment of schizophrenia, particularly in patients who may respond to the positive symptoms but still have residual negative symptoms,” said Alan Schatzberg, a psychiatry professor at Stanford University School of Medicine.

Schatzberg said the drug could be a “game changer” for schizophrenia patients.

While antipsychotics that target dopamine receptors reduce the symptoms of the disorder, their use also causes side effects such as tremors or involuntary movements and sleepiness.

The most common side effects of Cobenfy in studies included vomiting, nausea and constipation. The FDA said Cobenfy should not be prescribed to patients with urinary retention or those with moderate or severe kidney or liver disease.

Bristol expects that 80% of the drug's patient population will be covered by Medicare and Medicaid insurance in the 12 to 18 months following its launch.

“Our focus is to ensure that all of these coverage decisions are made very quickly after launch so that we provide patient access,” said Adam Lenkowsky, chief commercialization officer.

The company expects the drug to be in widespread use by the end of 2025, he added.

Currently approved antipsychotics include Vanda Pharmaceuticals' Fanapt, AbbVie's Vraylar, and generics such as olanzapine, quetiapine, and aripiprazole.

AbbVie is also developing newer drugs for the disease following its $8.7 billion acquisition of Cerevel Therapeutics late last year. Reviva Pharmaceuticals, Neurocrine Biosciences and Celon Pharma are also developing treatments for schizophrenia.

Schizophrenia causes persistent delusions and hallucinations and significantly affects the way patients perceive reality.

(Reporting by Puyaan Singh and Bhanvi Satija in Bengaluru and Michael Erman in New York; Editing by Krishna Chandra Eluri and Alan Barona)