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Novartis (NVS - Snapshot Report) recently announced positive results on Afinitor, from a phase III trial, BOLERO-3 (Breast cancer trials of OraL EveROlimus-3).

The study evaluated Novartis’ Afinitor plus Roche’s (RHHBY - Analyst Report) Herceptin and vinorelbine for the treatment of women suffering from human epidermal growth factor receptor-2 positive (HER2+) advanced breast cancer.

The study showed that Afinitor plus Herceptin and vinorelbine significantly extended progression-free survival (PFS) among treatment-experienced women vis-à-vis placebo plus Herceptin and vinorelbine, and reduced the risk of disease progression by 22%.

The study met its primary endpoint while data on secondary endpoint (overall survival) is not yet mature. We note that Novartis had presented initial results from the BOLERO-3 study in May 2013.

Novartis now plans to submit data from the trial to regulatory authorities across the world. We note that Afinitor is already approved in the US and EU for the treatment of HR+/HER2- advanced breast cancer in combination with Pfizer’s (PFE - Analyst Report) Aromasin, in postmenopausal women, whose disease has returned or progressed even after undergoing treatment with a non-steroidal aromatase inhibitor.

Novartis estimates that approximately 140,000 women are suffering from HER2+ advanced breast cancer across the world.

Hence, the successful development and commercialization of Afinitor for the above-mentioned indication will further boost the sales potential of the drug. Afinitor generated sales of $797 million in 2012, up 85% year over year.

However, we note that Roche has a pretty strong position in the breast cancer market. Roche obtained EU approval for Perjeta in Mar 2013, as a combination therapy for the treatment of adults with previously untreated HER2+ metastatic breast cancer (mBC).

In 2012, Roche obtained US Food and Drug Administration (FDA) approval for Perjeta plus Herceptin and docetaxel chemotherapy for treating patients suffering from HER2+ mBC.

Additionally, in Feb 2013, Roche obtained FDA approval for Kadcyla for the treatment of patients suffering from HER2+ mBC.

We believe the recent approvals of Perjeta and Kadcyla in addition to the existing drug Herceptin has strengthened Roche’s HER2+ mBC franchise considerably.

Novartis currently carries a Zacks Rank #3 (Hold). Right now, Salix Pharmaceuticals (SLXP - Analyst Report) looks attractive with a Zacks Rank #1 (Strong Buy).

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