WASHINGTON, April 14 (Reuters) - The U.S. Food and Drug Administration on Friday declined to approve a new drug for rheumatoid arthritis made by Eli Lilly and Co and partner Incyte Corp, the companies said on Friday.
The U.S. FDA indicated that additional clinical data was needed to determine the most appropriate doses of the drug, Olumiant, known also as baricitinib, and to further characterize safety concerns across treatment arms.
The FDA's request for additional data possibly means more than a year's delay for this important product for both companies, and represents a break for other drugmakers who were expected to face tough competition from Olumiant.
Approval of the drug could have introduced a significant new competitor to a lucrative market that includes Pfizer Inc's Xeljanz, AbbVie Inc's Humira and Amgen Inc's Enbrel.
More than 23 million people worldwide suffer from rheumatoid arthritis. Current treatments include non-steroidal anti-inflammatory drugs as well as older drugs such as methotrexate.
Olumiant is a once-daily pill in a class of drugs known as Jak inhibitors that includes twice-daily Xeljanz, which generated global sales in 2016 of $927 million.
Jak inhibitors block enzymes known as Janus kinases that cause inflammation. Analysts were expecting Olumiant to generate $1.7 billion in annual sales by 2023 according to Thomson Reuters data.
Olumiant appears to have a better safety profile than Pfizer's Xeljanz and would have been preferred by doctors on an approval by the FDA, according to Barclays analyst Geoff Meacham.
A survey of high prescribing rheumatologists conducted by Barclays found that 62 percent found Olumiant preferable to Xeljanz.
Jak inhibitors compete with injected biologics, including top-selling Humira, which in 2016 generated global sales of more than $16 billion. Enbrel generated sales of nearly $6 billion.
Lilly said on Friday it was reaffirming its financial forecast for 2017 and its mid-term outlook for the remainder of the decade.
Incyte said it would evaluate the impact of the FDA's response on its previously issued milestone and research and development expense forecast for 2017, and would provide an update on its first-quarter earnings call.
An approval of Olumiant would have triggered a milestone payment to Incyte of $100 million. Incyte would also have received additional sales-based milestone payments and royalties.
Data from a key late-stage trial known as RA-BEAM showed that patients taking baricitinib fared better than those taking either a placebo or Humira, which is injected once a week or once every other week. Overall efficacy was shown across four late-stage clinical trials. (Reporting by Toni Clarke in Washington and Ankit Ajmera in Bengaluru; Editing by Chizu Nomiyama)