Panel to Decide on HPV Vaccines

We await the outcome of the US Food and Drug Administration’s (FDA) advisory panel meeting scheduled for today that will decide on various aspects of human papillomavirus (HPV) vaccines.

Primarily there are two vaccines available for the prevention of cervical cancer in women -- Merck’s (MRK - Analyst Report) Gardasil and GlaxoSmithKline’s (GSK - Analyst Report) Cervarix. Both vaccines are given in a series of three shots over a six-month period.

Although Cervarix is approved in several countries, it has yet to gain FDA approval. In June 2006, the FDA approved the first cervical cancer vaccine, Gardasil (which targets four HPV strains: HPV 6, HPV 11, HPV 16 and HPV 18) for females 9 to 26 years of age.

The FDA panel will decide on the approval of Cervarix (targets two HPV strains, HPV 16 and HPV 18) in females 10 to 25 years of age. In addition, the vaccine contains an adjuvant which enhances the immunity system's response to these HPV strains. The US approval will open up a very large market for the product, which recorded £125 million of global sales in 2008.

The FDA has stated that Cervarix has proven to be effective at preventing cervical cancer associated with the two HPV strains in women up to 25 years of age, provided they hadn't been exposed to those HPV strains.

The clinical trial of the vaccine compared three doses of Cervarix with a placebo over a period of six months. The vaccine did protect the girls and women from cervical cancer, but some cases of miscarriages were reported in patients who had been vaccinated around the time of conception. Although there is no proof that those miscarriages were due to the vaccine, the FDA has asked the company to track such cases.

Additionally, the FDA also wants post-marketing studies to be conducted to track any cases of autoimmune diseases and musculoskeletal conditions in vaccinated patients.

Apart from the issue of Cervarix approval, the advisory panel is expected to decide on the approval of Gardasil for use in boys and men 9 to 26 years of age for the prevention of genital warts caused by particular HPV strains. The broader use of Gardasil would enable Merck to record robust sales as the company is struggling with slower sales of the product.

While sales ramped very quickly following FDA approval in June 2006, sales have struggled recently due to difficulty in penetrating older patients. Gardasil sales fell 5% in 2008 and were down 18% in the second quarter of 2009. We have a Neutral recommendation on the stock of Merck.

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