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Pharma Stock Roundup: MRK Signs New Cancer Deal, DERM's Acne Candidate Fails
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Last week, U.S. Senator Tina Smith expressed concerns that big pharma companies plan to use their large corporate tax savings to reward shareholders instead of bringing down costs of expensive drugs and benefiting consumers. The Senator questioned through letters to CEOs of five big pharma companies — Pfizer (PFE - Free Report) , Merck (MRK - Free Report) , Johnson & Johnson (JNJ - Free Report) , AbbVie (ABBV - Free Report) and Abbott Labs (ABT - Free Report) — how they plan to use their extra cash.
Please note that on their Q4 conference calls held earlier this year, most big pharma companies discussed what they plan to do with the extra cash they save from the new tax bill. These companies plan to invest the extra cash in capital expenditures, products/pipeline, in-licensing or acquisition deals or rewarding shareholders through higher dividends and share buybacks. Not many talked about taking any steps to lower prescription drug costs.
This apart, key announcements this week included the failure of Dermira, Inc.’s (DERM - Free Report) acne candidate in two pivotal late-stage studies, Merck’s oncology collaboration with Japan’s Eisai, expansion of Jardiance clinical studies by Eli Lilly (LLY - Free Report) and FDA committee backing for Pfizer’s Xeljanz for the third indication.
Recap of the Week’s Most Important Stories
Dermira Shares Sink as Acne Candidate Fails: Shares of Dermira plunged after it announced that its acne candidate, olumacostat glasaretil, surprisingly failed to meet the primary endpoint in either of the two pivotal phase III studies -- CLAREOS-1 and CLAREOS-2. The company said that it will likely stop olumacostat glasaretil’s development following this failure. (Read More: Dermira's Acne Candidate Fails in Pivotal Trials, Shares Sink)
Merck to Jointly Develop Eisai’s Cancer Drug Lenvima: Similar to last year’s profit sharing deal with AstraZeneca (AZN - Free Report) , Merck announced an oncology collaboration with Japan’s Eisai Co., Ltd. Per this deal, the companies will jointly develop and commercialize Eisai’s tyrosine kinase inhibitor, Lenvima, both as a monotherapy and in combination with Merck’s anti-PD-1 therapy, Keytruda for several types of cancer. For the deal, Merck will give Eisai an upfront payment of $300 million. The companies will share global development and marketing costs as well as gross profits from Lenvima equally. (Read More: Merck to Pay $300M Upfront to Co-Develop Eisai's Cancer Drug)
Pfizer’s Xeljanz sNDA Gets FDA Committee Backing: Pfizer’s supplemental new drug application to include the ulcerative colitis (UC) indication in its label received a backing from an FDA advisory committee. The FDA’s Gastrointestinal Drugs Advisory Committee (GIDAC) voted unanimously in favor of the JAK inhibitor. The FDA’s decision is expected in June. Xeljanz, which is already approved to treat rheumatoid arthritis and active psoriatic arthritis, recorded sales of $1.35 billion in 2017, representing growth of 45% year over year.
AstraZeneca Looks for Forxiga EU Approval in Type I Diabetes: AstraZeneca’s application looking to get its SGLT-2 inhibitor, Forxiga, approved for a new indication -- an oral adjunct treatment to insulin in type-1 diabetes (T1D) patients -- was accepted by the European Medicines Agency. Forxiga is presently approved as a monotherapy as well as a combination therapy to treat type-2 diabetes. If approved, Forxiga will become the first SGLT-2 inhibitor approved in Europe for the treatment of T1D as an oral treatment adjunct to insulin. (Read More: AstraZeneca's Forxiga Label Expansion Filing Accepted in EU)
Glaxo Presents Asthma/HIV Data: Glaxo (GSK - Free Report) presented data from OSMO study on a new respiratory medicine, Nucala, at American Academy of Allergy, Asthma & Immunology (AAAAI) and World Allergy Organization (WAO) Joint Congress in Orlando. Data from the study showed that patients whose asthma was uncontrolled with Xolair witnessed improved asthma control on switching to Glaxo’s new respiratory medicine, Nucala.
Meanwhile, Glaxo gained approval to expand the European label of its once-daily LABA/ICS combination treatment, Relvar Ellipta. Now, Relvar Ellipta can be used in the EU in patients whose asthma is already adequately controlled by an ICS/LABA. With the label update, doctors can prescribe asthma patients to switch to once-daily Relvar Ellipta from their current twice-daily ICS/LABA, while experiencing comparable benefit in lung function and safety profile.
Lilly, Boehringer to Expand Jardiance Clinical Studies: Lilly and partner Boehringer Ingelheim announced plans to initiate two phase III EMPERIAL studies, which will evaluate the effect of Lilly’s SGLT2 inhibitor Jardiance on exercise ability and heart failure symptoms in people with chronic heart failure irrespective of whether they have type II diabetes. Though the presently ongoing phase III EMPEROR outcomes studies are evaluating the effect of Jardiance on long-term morbidity and mortality outcomes in people with heart failure, the EMPERIAL studies will investigate if treatment with Jardiance can help improve the everyday lives of people living with chronic heart failure. (Read More: Lilly, Boehringer to Expand Jardiance Heart Failure Program).
The NYSE ARCA Pharmaceutical Index was up 2.6% in the last five trading sessions.
Watch out for regulatory and pipeline news from pharma stocks.
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Pharma Stock Roundup: MRK Signs New Cancer Deal, DERM's Acne Candidate Fails
Last week, U.S. Senator Tina Smith expressed concerns that big pharma companies plan to use their large corporate tax savings to reward shareholders instead of bringing down costs of expensive drugs and benefiting consumers. The Senator questioned through letters to CEOs of five big pharma companies — Pfizer (PFE - Free Report) , Merck (MRK - Free Report) , Johnson & Johnson (JNJ - Free Report) , AbbVie (ABBV - Free Report) and Abbott Labs (ABT - Free Report) — how they plan to use their extra cash.
Please note that on their Q4 conference calls held earlier this year, most big pharma companies discussed what they plan to do with the extra cash they save from the new tax bill. These companies plan to invest the extra cash in capital expenditures, products/pipeline, in-licensing or acquisition deals or rewarding shareholders through higher dividends and share buybacks. Not many talked about taking any steps to lower prescription drug costs.
This apart, key announcements this week included the failure of Dermira, Inc.’s (DERM - Free Report) acne candidate in two pivotal late-stage studies, Merck’s oncology collaboration with Japan’s Eisai, expansion of Jardiance clinical studies by Eli Lilly (LLY - Free Report) and FDA committee backing for Pfizer’s Xeljanz for the third indication.
Recap of the Week’s Most Important Stories
Dermira Shares Sink as Acne Candidate Fails: Shares of Dermira plunged after it announced that its acne candidate, olumacostat glasaretil, surprisingly failed to meet the primary endpoint in either of the two pivotal phase III studies -- CLAREOS-1 and CLAREOS-2. The company said that it will likely stop olumacostat glasaretil’s development following this failure. (Read More: Dermira's Acne Candidate Fails in Pivotal Trials, Shares Sink)
Merck to Jointly Develop Eisai’s Cancer Drug Lenvima: Similar to last year’s profit sharing deal with AstraZeneca (AZN - Free Report) , Merck announced an oncology collaboration with Japan’s Eisai Co., Ltd. Per this deal, the companies will jointly develop and commercialize Eisai’s tyrosine kinase inhibitor, Lenvima, both as a monotherapy and in combination with Merck’s anti-PD-1 therapy, Keytruda for several types of cancer. For the deal, Merck will give Eisai an upfront payment of $300 million. The companies will share global development and marketing costs as well as gross profits from Lenvima equally. (Read More: Merck to Pay $300M Upfront to Co-Develop Eisai's Cancer Drug)
Pfizer’s Xeljanz sNDA Gets FDA Committee Backing: Pfizer’s supplemental new drug application to include the ulcerative colitis (UC) indication in its label received a backing from an FDA advisory committee. The FDA’s Gastrointestinal Drugs Advisory Committee (GIDAC) voted unanimously in favor of the JAK inhibitor. The FDA’s decision is expected in June. Xeljanz, which is already approved to treat rheumatoid arthritis and active psoriatic arthritis, recorded sales of $1.35 billion in 2017, representing growth of 45% year over year.
AstraZeneca Looks for Forxiga EU Approval in Type I Diabetes: AstraZeneca’s application looking to get its SGLT-2 inhibitor, Forxiga, approved for a new indication -- an oral adjunct treatment to insulin in type-1 diabetes (T1D) patients -- was accepted by the European Medicines Agency. Forxiga is presently approved as a monotherapy as well as a combination therapy to treat type-2 diabetes. If approved, Forxiga will become the first SGLT-2 inhibitor approved in Europe for the treatment of T1D as an oral treatment adjunct to insulin. (Read More: AstraZeneca's Forxiga Label Expansion Filing Accepted in EU)
Glaxo Presents Asthma/HIV Data: Glaxo (GSK - Free Report) presented data from OSMO study on a new respiratory medicine, Nucala, at American Academy of Allergy, Asthma & Immunology (AAAAI) and World Allergy Organization (WAO) Joint Congress in Orlando. Data from the study showed that patients whose asthma was uncontrolled with Xolair witnessed improved asthma control on switching to Glaxo’s new respiratory medicine, Nucala.
Glaxo also presented interim data from a phase IIIb study, INSPIRING, on investigational HIV candidate dolutegravir at a medical conference in Boston. (Read More: Glaxo’s Encouraging Asthma & HIV Data at Medical Meetings)
Meanwhile, Glaxo gained approval to expand the European label of its once-daily LABA/ICS combination treatment, Relvar Ellipta. Now, Relvar Ellipta can be used in the EU in patients whose asthma is already adequately controlled by an ICS/LABA. With the label update, doctors can prescribe asthma patients to switch to once-daily Relvar Ellipta from their current twice-daily ICS/LABA, while experiencing comparable benefit in lung function and safety profile.
Lilly, Boehringer to Expand Jardiance Clinical Studies: Lilly and partner Boehringer Ingelheim announced plans to initiate two phase III EMPERIAL studies, which will evaluate the effect of Lilly’s SGLT2 inhibitor Jardiance on exercise ability and heart failure symptoms in people with chronic heart failure irrespective of whether they have type II diabetes. Though the presently ongoing phase III EMPEROR outcomes studies are evaluating the effect of Jardiance on long-term morbidity and mortality outcomes in people with heart failure, the EMPERIAL studies will investigate if treatment with Jardiance can help improve the everyday lives of people living with chronic heart failure. (Read More: Lilly, Boehringer to Expand Jardiance Heart Failure Program).
The NYSE ARCA Pharmaceutical Index was up 2.6% in the last five trading sessions.
Large Cap Pharmaceuticals Industry 5YR % Return
Large Cap Pharmaceuticals Industry 5YR % Return
Here is how the seven major stocks performed:
In the last five trading sessions, all the seven major stocks rose. The largest gainers were Glaxo (4.3%), J&J (3.8%) and Lilly (3.2%).
In the last six months, while Bristol-Myers (BMY - Free Report) gained 6.5%, Merck declined 15.9%. (See the last pharma stock roundup here: AZN's Imfinzi Gets 2nd FDA Nod, MRK to Buy Australian Firm)
What's Next in the Pharma World?
Watch out for regulatory and pipeline news from pharma stocks.
Don’t Even Think About Buying Bitcoin Until You Read This
The most popular cryptocurrency skyrocketed last year, giving some investors the chance to bank 20X returns or even more. Those gains, however, came with serious volatility and risk. Bitcoin sank 25% or more 3 times in 2017.
Zacks has just released a new Special Report to help readers capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 4 crypto-related stocks now >>