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Merck (MRK - Analyst Report), which has a strong presence in the diabetes market, continues to focus on developing its portfolio for other indications.

Merck has several pipeline candidates in advanced stages of development targeting multiple diseases such as anemia, atherosclerosis, cancer, diabetes, and hypertension. 

The company recently received positive news when the U.S. Food and Drug Administration (FDA) approved the tablet formulation of its antifungal product, Noxafil.

The FDA approved 100 mg delayed-release tablets of Noxafil. We note that the oral suspension of Noxafil is already approved for the prophylaxis of invasive aspergillus and candida infections in patients aging 13 or above. 

These patients -- such as hematopoietic stem cell transplant (HSCT) recipients with graft-versus-host disease (GVHD) or those with hematologic malignancies with prolonged neutropenia (low white blood cell counts) from chemotherapy -- are at a high risk of developing infections due to being severely immunocompromised.

The FDA approval was based on positive results from a multicenter study which evaluated the pharmacokinetic properties, safety and tolerability of Noxafil delayed-release tablets in patients suffering from acute myeloid leukemia (AML) or myelodysplastic syndrome (MDS).

We note that the FDA had granted priority review status to Merck’s NDA for an intravenous (IV) Formulation of Noxafil earlier in the month.

We believe Merck has entered a challenging period with erstwhile blockbuster drug, Singulair, losing exclusivity in the U.S. in early Aug 2012 and in the EU in Feb 2013.

Nevertheless, some of the company’s recent launches should start contributing significantly to the top line in the forthcoming quarters.

Merck currently carries a Zacks Rank #3 (Hold). Companies that currently look well-positioned include Bayer (BAYRY - Analyst Report), Allergan (AGN - Analyst Report) and Johnson and Johnson (JNJ - Analyst Report). All three are Zacks Rank #2 (Buy) stocks.

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