Pipeline updates are highly awaited events in the pharma/biotech sector as they play an important role in deciding whether or not to invest in a particular company. These updates provide information on experimental drugs and at times give an insight into the commercial potential of the candidate once it is successfully developed and commercialized.
Shire (SHPG - Analyst Report) holds a strong position in the attention deficit and hyperactivity disorder (ADHD) market driven by key drugs like Vyvanse, Intuniv and Adderall XR. The growth engine of Shire is Vyvanse which is being developed for additional indications as well.
However, Shire recently suffered a setback when Vyvanse failed to meet the primary efficacy endpoint in two pivotal phase III studies (SPD489-322 and SPD489-323) even though the safety profile of Vyvanse was consistent with other studies in adults with ADHD.
Shire was evaluating the efficacy and safety of Vyvanse in the two phase III studies as compared to placebo as an adjunctive treatment for major depressive disorder (MDD) in adults who did not adequately respond to antidepressants.
As Vyvanse did not meet the primary efficacy endpoint versus placebo for either study, the disappointing results of the trials have forced Shire to discontinue the clinical development program.
Nevertheless, Shire is evaluating Vyvanse for the indication of binge eating disorder (BED) and expects to submit a filing to the U.S. Food and Drug Administration (FDA) later in the year.
We were disappointed with the top-line results from the two studies. The successful development and commercialization of Vyvanse for additional indications would have boosted sales in the coming quarters.
Shire currently carries a Zacks Rank #2 (Buy). Other pharma stocks that look attractive at current levels include Endocyte Inc. (ECYT - Snapshot Report), Forest Laboratories and Salix Pharmaceuticals Ltd. (SLXP - Analyst Report). All the three stocks carry a Zacks Rank #1 (Strong Buy).