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Incyte Gains on Jakafi's Breakthrough Status for Acute GVHD

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Incyte Corporation (INCY - Free Report) announced that the FDA has granted Breakthrough Therapy status to Jakafi (outside the U.S.: Jakavi) for the treatment of patients suffering from acute graft-versus-host disease (GVHD). Incyte’s shares gained 4% on the news.

We note that the FDA usually grants Breakthrough Therapy status to expedite the development and review of drugs for the treatment of serious or life-threatening conditions, and to help ensure that people have access to them through FDA approval as soon as possible. In order to obtain this status, preliminary clinical evidence is required demonstrating that the drug may have clinically significant improvement over available therapy.

We are encouraged by the FDA granting Breakthrough Therapy status to Jakafi for acute GVHD. Currently, there are no approved treatments for patients with acute GVHD.

Incyte expects to initiate a pivotal development program on Jakafi for GVHD in the second half of 2016.

We remind investors that Incyte and Eli Lilly and Co. (LLY - Free Report) agreed to amend their license, development and commercialization agreement in Mar 2016 to enable the former to independently develop and commercialize Jakafi for GVHD.

Subsequently in Apr 2016, Incyte and Novartis AG (NVS - Free Report) also agreed to amend their collaboration and license agreement granting the latter the rights to research, develop and commercialize Jakafi for GVHD outside the U.S.

We note that Jakafi is approved in the U.S. for the treatment of patients with polycythemia vera who have had an inadequate response to or are intolerant of hydroxyurea. It is also approved for the treatment of patients with intermediate or high-risk myelofibrosis (MF), including primary MF, post-polycythemia vera MF, and post-essential thrombocythemia MF. While Incyte markets the drug in the U.S., it is marketed by Novartis outside the country.

Incyte is a Zacks Rank #3 (Hold) stock. Bristol-Myers Squibb Company (BMY - Free Report) is a better-ranked stock in the health care sector, sporting a Zacks Rank #1 (Strong Buy).

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