With the U.S. Food and Drug Administration (FDA) approving the oral COVID-19 treatment "Xocova (ensitrelvir)," co-developed by Ildong Pharmaceutical and Japan's Shionogi, the company is expected to accelerate its renewed push for domestic approval.
However, with treatments already distributed in the domestic market and overall demand for COVID-19 therapeutics having declined markedly compared with the pandemic period, some say the drug's actual marketability after approval remains uncertain.
The FDA said on the 30th of last month (local time) that it had granted final approval for Xocova for post-exposure prophylaxis. It is the first oral treatment to be approved after being recognized for preventing infection or onset following exposure to the COVID-19 virus. Ildong Pharmaceutical holds the domestic distribution rights.
With this FDA approval, Ildong Pharmaceutical is also expected to move to re-seek domestic authorization. Late last year, the company voluntarily withdrew its marketing application, saying it would add Shionogi's post-exposure prophylaxis clinical data and pursue approval again.
◇ Hobbled by the omicron variant… domestic approval adrift for a fourth year
Xocova is an antiviral that inhibits the 3CL protease (a protein-degrading enzyme) necessary for the replication of the COVID-19 virus. It works by blocking viral replication when administered to patients early after symptom onset.
Xocova was initially developed as a treatment. In phase 2/3 trials, it showed a marked reduction in viral load among patients who took the drug. But as COVID-19 shifted to being dominated by the omicron variant, severity decreased, and the company struggled to demonstrate a clear difference versus placebo in evaluating improvements in key symptoms.
Domestic approval also proved difficult. Although Xocova began to be prescribed in Japan after receiving emergency use authorization in Nov. 2022, the emergency use authorization sought in Korea around the same time was not granted. At the time, the Korea Disease Control and Prevention Agency and the Ministery of Food and Drug Safety were said to have determined that existing treatments were sufficient.
Afterward, Ildong Pharmaceutical applied for an import license in Jan. 2023 and, in Dec. of the same year, switched to a manufacturing and sales license to continue the review. However, as the review period lengthened, the company voluntarily withdrew its application in Dec. last year. Instead, it moved to revise its strategy based on new prophylaxis clinical data secured by Shionogi.
◇ From treatment to prophylaxis… Xocova's bid to break through
The biggest change for Xocova is that its scope has expanded from treatment to the prevention space.
In a global phase 3 trial conducted in the second half of 2024, Shionogi confirmed preventive efficacy in people who had close contact with or were exposed to individuals infected with COVID-19. When Xocova was administered once daily to asymptomatic contacts, the rate of developing symptomatic COVID-19 within 10 days was lower than in the placebo group.
The latest FDA approval was also based on those trial results. Accordingly, Xocova's eligible population has expanded from COVID-19 patients to close contacts such as family members or caregivers who live with patients. In particular, it is seen as potentially useful for prevention when high-risk groups, such as older adults or people with underlying conditions, are present in the household.
This is also why the industry expects Xocova to have market potential. In Korea, Pfizer's Paxlovid is effectively the only oral COVID-19 treatment available. Paxlovid is used for high-risk patients early after onset but has not demonstrated post-exposure prophylactic efficacy.
Merck's "Lagevrio (molnupiravir)" has been off the market since March this year after government-held stock reached expiration, and Celltrion's "Regkirona" has also seen commercial supply halted at home and abroad since the omicron wave.
As a result, if Xocova secures domestic approval, some forecast it could establish a differentiated position from existing treatments.
An industry official said, "FDA approval reflects not only efficacy and safety but also assessed value in real-world clinical settings," adding, "Xocova is differentiated as the world's first oral treatment approved for post-exposure prophylaxis."
◇ Will it succeed even if approved? The remaining challenge is "marketability"
Some, however, note that approval and commercial viability are separate issues.
As COVID-19 has entered an endemic phase, most government support has ended, and actual prescription demand has fallen sharply compared with the pandemic period. Although COVID-19 has recently become a year-round infectious disease that recurs even in summer, analysts say it is difficult to expect the same large-scale demand for therapeutics as in the past.
Drug pricing is also a key variable. In Japan, sales increased when the government fully covered the expense of Xocova prescriptions, but revenues reportedly fell sharply after support ended in 2024. In Korea as well, the market size could vary depending on whether it is covered by national health insurance and at what price level.
Given that Ildong Pharmaceutical has continued large-scale research and development (R&D) investment in Xocova for years, there is interest in whether it can recoup its investment after securing approval. The company's annual R&D expense rose sharply from 78.6 billion won in 2020 to 108.2 billion won in 2021, when it signed a joint development agreement with Shionogi on Xocova, and to 121.6 billion won in 2022.
Even if domestic approval follows the FDA's decision, some say it could take considerable time to recoup the investment if actual prescription demand does not sufficiently materialize.
An industry official said, "It will be difficult for the COVID-19 therapeutics market to return to the size seen during the pandemic," but added, "Xocova is differentiated by its prophylaxis indication that existing treatments have not secured, so the key variable for marketability will be how much it is actually used in real-world clinical settings after approval."