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Eli Lilly's Taltz Shows Better Efficacy than J&J's Stelara

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Eli Lilly and Company (LLY - Free Report) announced superior efficacy in a head-to-head study evaluating its marketed drug, Taltz (ixekizumab) versus with Johnson & Johnson’s Stelara (ustekinumab) in patients with moderate-to-severe plaque. The results from the IXORA-S study were presented at the annual meeting of American Academy of Dermatology (AAD) in Orlando, FL this week. Please note that Taltz is already approved in the U.S. and the EU for the treatment of moderate-to-severe plaque psoriasis and in Japan for psoriatic arthritis.

Eli Lilly’s shares have outperformed the Zacks classified Large Cap Pharma industry year to date. Its shares gained 12.4%, while the industry registered an increase of 6.2%.



We remind the investors that, the company has also initiated a phase III study for label expansion of Taltz in patients with axial spondyloarthritis in May 2016.

Taltz specifically targets IL-17A, a protein that aggravates the underlying inflammation in psoriasis. However, Taltz is not the first IL-17A antagonist to gain FDA approval. Novartis (NVS - Free Report) had head start with its IL-17A antagonist, Cosentyx, which gained FDA approval in Jan 2015. Since then, the Cosentyx label has been expanded to include two additional indications – active ankylosing spondylitis and active psoriatic arthritis.

In the IXORA-S study, patients were randomized to receive either Stelara (45 mg or 90 mg weight-based dosing per label) or Taltz (80 mg every two weeks for 12 weeks followed by 80 mg every four weeks), following a 160-mg starting dose, for a total of 52 weeks. The study demonstrated significantly higher response rates in patients treated with Taltz compared to Stelara. The study also showed that 83% of patients achieved psoriasis area severity index (PASI )90, which was the study's primary endpoint, after treatment with Taltz. Notably, only 59% of patients achieved PASI 90 after treatment with Stelara. The adverse events reported in the study were mild or moderate.

We note that even though several treatments are available, the psoriasis market continues to have a huge commercial potential. Per company’s press release, psoriasis affects approximately 125 million people worldwide, approximately 20% of whom have moderate-to-severe plaque psoriasis. Hence, the drug has huge scope to penetrate the market as an additional option for treating the disease.

Zacks Rank & Key Picks

Eli Lilly currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector include Celgene Corporation and Sunesis Pharmaceuticals, Inc. . Each of these stocks carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Celgene’s earnings per share estimates increased from $6.52 to $6.60 for 2017 and from $8.15 to $8.16 for 2018 over the last 60 days. The company posted positive earnings surprises in three of the four trailing quarters with an average beat of 5.08%.

Sunesis’ loss per share estimates narrowed from $2.57 to $2.44 for 2016 and from $2.16 to $1.97 for 2017 over the last 60 days. The company posted positive earnings surprises in three of the four trailing quarters with an average beat of 0.54%.

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