Monday, November 11, 2013


Disclosure: After investigation, I believe that AEGR is grossly overvalued, that its addressable market has been exaggerated by 1,000%, and that its regulatory risks are not yet reflected in the stock price. Consequently, I am short AEGR. I am not infallible. All claims and references herein should be verified by the reader. All investors must do their own due diligence.  This report is not a recommendation.

Matt Berry:

The numbers used in Aegerion’s SEC filings are transparent.  To get to a population of 3,000 patients the study included HeFH patients, of which HoFH patients are the required subset. 

“In 2010, we commissioned an independent consultant in the healthcare industry to prepare a commercial assessment of the HoFH market for us. In its report, this consultant estimated that the total number of patients likely to seek treatment with symptoms, signs or laboratory findings consistent with HoFH in each of the U.S. and the EU is approximately 3,000 patients. This consultant’s estimates, however, included a segment of HeFH patients whose levels of LDL-C are not controlled by current therapies. These patients may be phenotypically indistinct from HoFH patients. Lomitapide is indicated in the U.S. and EU solely for HoFH.”[1]

Is this how Aegerion could reach a patient population of 3,000 – by going off-label? Unlikely. The drug was approved specifically for HoFH patients. And it is clear from the FDA’s committee meeting that there was serious concern if the drug should be used outside of the HoFH populationoHo.  Aegerion’s Chief Medical Officer assured everyone in the FDA meeting that the HeFH patients would not be pursued and that the drug would be limited to HoFH patients.


Can Aegerion promote the drug off-label? Not legally.  Will doctors go off-label on their own accord? It is possible, but there are barriers. One barrier is that a patient needs to be able to afford the $295,000 yearly price tag, if not through insurance then out-of-pocket.  And there is another barrier: lomitapide poses such a risk to the liver that the FDA required Aegerion to work under a Risk Evaluation and Mitigation Strategy (REMS), with Elements to Assure Safe Use (ETASU).  This policy was put in place in large part to prevent off-label abuse and was one of the conditions preceding Aegerion’s approval as an orphan product.  

“We would like to reiterate our position that while the study of BMS-201038 [i.e., lomitapide] in high-risk patients such as those with homozygous FH is acceptable despite significant potential risk associated with drug-induced fat accumulation in the liver and lung (and perhaps the intestine), the use of BMS-201038 in a lower-risk population (e.g., heterozygous FH, type IIa and IIb patients) may not be justified in light of the documented preclinical toxicities observed at low multiple of the proposed clinical doses.[2]


Just to mention two requirements within the REMS, a prescriber must be trained and must sign an attestation that the patient has a diagnosis consistent with HoFH. So in the case of Lomitapide, can a doctor knowingly prescribe the drug off-label without lying about the diagnosis?  How much liability would be involved if the patient suffered from liver damage?

 If Aegerion tries to promote the drug off label there could serious financial consequences, as JNJ has recently discovered.

“Janssen Pleads Guilty to Selling Risperdal Off-Label”

Johnson & Johnson (JNJ)’s Janssen unit pleaded guilty to misbranding its anti-psychotic medication Risperdal. The plea is part of a $2.2 billion settlement with U.S. prosecutors.”


“Janssen pleaded guilty to marketing the drug for uses not approved by the U.S. Food and Drug Administration ….”[3]


And we have little doubt that the FDA is indeed watching Aegerion. On November 8, 2013 the FDA issued a warning letter to the CEO, regarding promoting “new uses” and “misbranding” the drug lomitapide in two CNBC interviews.[4]


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