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This week Lilly (LLY - Free Report) , Pfizer (PFE - Free Report) and Novartis (NVS - Free Report) reported fourth-quarter earnings and sales. J&J (JNJ - Free Report) said it is working on developing a vaccine for the new coronavirus that has killed many and affected thousands in China. Allergan announced a definitive deal to divest brazikumab and Zenpep to close the merger with AbbVie.
Recap of the Week’s Most Important Stories:
Lilly, Pfizer & Novartis Q4 Update: Lilly announced strong fourth-quarter results, beating estimates for both earnings and sales. Lilly re-affirmed its 2020 adjusted earnings guidance while slightly raising its revenue guidance.
Pfizer’s fourth-quarter 2019 performance was weak as it missed estimates for both earnings and sales. Revenues declined 8% year over year on an operational basis. The company issued its financial guidance for 2020 for the present Pfizer as well as for the “New Pfizer”, after the Upjohn divesture.
Novartis’ earnings and sales also missed estimates for both earnings and sales. Nevertheless, sales were up year over year, driven by the solid performance of key drugs like Cosentyx and Entresto, and contribution from gene therapy, Zolgensma. The sales guidance for 2020 was encouraging as well. The company expects net sales in 2020 to grow in mid to high-single digits.
Roche’s sales rose 6% in the quarter propelled by strong performance of new drugs. While sales at the Pharmaceuticals division increased 11%, the same at the Diagnostics division climbed 3%,
J&J Begins Making Vaccine to Fight Coronavirus: J&J said that it is working on developing a vaccine to address the current novel coronavirus (2019-nCoV) outbreak. The company aims to identify compounds with antiviral activity against 2019-nCoV. The program will leverage J&J’s same technologies that were used in making its investigational Ebola vaccine, which is currently being administered in the Democratic Republic of Congo and Rwand.
Meanwhile, the European Commission granted approval to J&J’s Erleada for expanded use — for the treatment of patients with metastatic hormone-sensitive prostate cancer (mHSPC). Erleada is already marketed in the EU for the treatment of men with non-metastatic castration-resistant prostate cancer. The approval was based on data from the phase III TITAN study. Erleada was approved for a similar indication in the United States in September last year.
Allergan to Divest Brazikumab & Zenpep for AbbVie Merger: Allergan announced a definitive agreement to divest its mid-stage candidate brazikumab and marketed medicine, Zenpep to AstraZeneca and Nestle, respectively in connection with its pending merger with AbbVie. AbbVie is due to buy Allergan in a cash-and-stock deal for $63 billion. The deal, if it gets all necessary approvals, is expected to close in early 2020.Brazikumab is in phase IIb/III development for Crohn's Disease and in phase II development for ulcerative colitis, while Zenpep is marketed in the United States for exocrine pancreatic insufficiency due to cystic fibrosis and other conditions
AstraZeneca and Allergan had a license agreement for brazikumab, which is now terminated and all rights to this monoclonal antibody targeting IL23, go back to AstraZeneca. Financial terms of the transactions were not disclosed
Roche Seeks Approval of Tecentriq Combo in Liver Cancer: Roche submitted a supplemental biologics license application (sBLA) to the FDA seeking approval of its PD-L1 inhibitor, Tecentriq in combination with Avastin for the unresectable hepatocellular carcinoma (HCC), the most common form of liver cancer. The sBLA was based on data from the phase III IMbrave150 study, which demonstrated that the Tecentriq plus Avastin combo improved overall survival (OS) by 42% and progression-free survival (PFS) by 41% compared with standard of care, Bayer’s Nexavar (sorafenib). OS and PFS were the co-primary endpoints of the study.
AstraZeneca’s Enhertu Meets Goal in Gastric Cancer Study: AstraZeneca’s (AZN - Free Report) phase II study evaluating its newly approved cancer medicine, Enhertu (trastuzumab deruxtecan) in gastric cancer met the primary endpoint. Top-line data from the study showed that treatment with Enhertu led to statistically significant and clinically meaningful improvement in objective response rate (ORR) — primary endpoint and OS — a key secondary endpoint in patients with previously treated HER2-positive metastatic gastric cancer. Enhertu, which AstraZeneca is jointly developing and commercializing with Japan’s Daiichi Sankyo, was approved by the FDA for metastatic breast cancer in December.
AstraZeneca also announced an agreement to sell global commercial rights to some hypertension medicines, Inderal, Tenormin, Tenoretic, Zestril and Zestoretic to Atnahs Pharma to allow it to focus on its portfolio of new medicines. The agreement excludes the rights in the United States and India, which were previously divested, and in Japan, which will be retained by AstraZeneca.
Meanwhile, AstraZeneca’s blood thinner, Brilinta met primary endpoint in phase III THALES study in stroke. The data from the study showed that Brilinta in combination with aspirin led to a statistically significant and clinically meaningful reduction in the risk of the primary composite endpoint of stroke and death, in patients who had experienced a minor acute ischemic stroke or high-risk transient ischemic attack.
FDA Grants Approval to Merck’s Dificid for New Formulation and Pediatric Indication: Merck (MRK - Free Report) announced that the FDA has granted approval to two regulatory applications seeking expanded approval of its antibacterial medicine, Dificid. The first application was an NDA looking for approval of an oral suspension formulation of Dificid, which is presently available in tablet form. The second application was a sNDA looking for approval of Dificid for the treatment of pediatric patients aged 6 months or older with Clostridioides (formerly Clostridium) difficile-associated diarrhea..
Lilly’s Two Phase III Studies on Olumiant in Eczema Succeed: Lilly & Incyte’s two phase III studies evaluating their JAK inhibitor, Olumiant, in patients with moderate-to-severe atopic dermatitis (AD), met the primary endpoint of at least 75% improvement of skin inflammation. The primary endpoint of both the studies was defined by the proportion of participants achieving at least 75% or greater change from baseline in their Eczema Area and Severity Index (EASI) at week 16.
The BREEZE-AD4 study, which was conducted outside the United States, evaluated Olumiant (1-mg, 2-mg and 4-mg doses) in combination with topical corticosteroids (TCS) in patients with moderate-to-severe AD who failed conventional systemic treatments like cyclosporine. In the study, the 4-mg dose of baricitinib plus TCS met the primary endpoint. The BREEZE-AD5, conducted in North America, evaluated 1-mg and 2-mg doses of baricitinib as a monotherapy in AD patients. In this study, the 2-mg dose of baricitinib met the primary endpoint as well as some key secondary endpoints.
Olumiant, which is the presently marketed to treat active rheumatoid arthritis, is under review in Europe as a treatment for patients with moderate to severe atopic dermatitis. Lilly also plans to submit regulatory application in the United States for the atopic dermatitis indication this year. The data from the BREEZE-AD5 study will support the U.S. filing.
The FDA granted priority review status to Lilly’s new drug application (NDA) for its investigational oral RET inhibitor, selpercatinib. The NDA seeks approval of selpercatinib for RET-altered lung and thyroid cancers based on data from the LIBRETTO-001 phase I/II study. With the FDA granting priority review to the NDA, a decision is expected in the third quarter of this year.
The FDA also approved Lilly and partner, Boehringer Ingelheim’s Trijardy XR, a triple-combination tablet, for adults with type II diabetes. Trijardy XR, a once daily therapy provides three type II diabetes medicines, Jardiance, Tradjenta and metformin hydrochloride extended release, in one pill. Trijardy XR will be available in four different dosages.
The NYSE ARCA Pharmaceutical Index declined 1.8% in the last five trading sessions.
Watch out for fourth-quarter 2019 results of Bristol-Myers, AbbVie, Merck and regular pipeline and regulatory updates next week.
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Pharma Stock Roundup: LLY, PFE Q4 Results, JNJ's Coronavirus Vaccine Initiative
This week Lilly (LLY - Free Report) , Pfizer (PFE - Free Report) and Novartis (NVS - Free Report) reported fourth-quarter earnings and sales. J&J (JNJ - Free Report) said it is working on developing a vaccine for the new coronavirus that has killed many and affected thousands in China. Allergan announced a definitive deal to divest brazikumab and Zenpep to close the merger with AbbVie.
Recap of the Week’s Most Important Stories:
Lilly, Pfizer & Novartis Q4 Update: Lilly announced strong fourth-quarter results, beating estimates for both earnings and sales. Lilly re-affirmed its 2020 adjusted earnings guidance while slightly raising its revenue guidance.
Pfizer’s fourth-quarter 2019 performance was weak as it missed estimates for both earnings and sales. Revenues declined 8% year over year on an operational basis. The company issued its financial guidance for 2020 for the present Pfizer as well as for the “New Pfizer”, after the Upjohn divesture.
Novartis’ earnings and sales also missed estimates for both earnings and sales. Nevertheless, sales were up year over year, driven by the solid performance of key drugs like Cosentyx and Entresto, and contribution from gene therapy, Zolgensma. The sales guidance for 2020 was encouraging as well. The company expects net sales in 2020 to grow in mid to high-single digits.
Roche’s sales rose 6% in the quarter propelled by strong performance of new drugs. While sales at the Pharmaceuticals division increased 11%, the same at the Diagnostics division climbed 3%,
J&J Begins Making Vaccine to Fight Coronavirus: J&J said that it is working on developing a vaccine to address the current novel coronavirus (2019-nCoV) outbreak. The company aims to identify compounds with antiviral activity against 2019-nCoV. The program will leverage J&J’s same technologies that were used in making its investigational Ebola vaccine, which is currently being administered in the Democratic Republic of Congo and Rwand.
Meanwhile, the European Commission granted approval to J&J’s Erleada for expanded use — for the treatment of patients with metastatic hormone-sensitive prostate cancer (mHSPC). Erleada is already marketed in the EU for the treatment of men with non-metastatic castration-resistant prostate cancer. The approval was based on data from the phase III TITAN study. Erleada was approved for a similar indication in the United States in September last year.
Allergan to Divest Brazikumab & Zenpep for AbbVie Merger: Allergan announced a definitive agreement to divest its mid-stage candidate brazikumab and marketed medicine, Zenpep to AstraZeneca and Nestle, respectively in connection with its pending merger with AbbVie. AbbVie is due to buy Allergan in a cash-and-stock deal for $63 billion. The deal, if it gets all necessary approvals, is expected to close in early 2020.Brazikumab is in phase IIb/III development for Crohn's Disease and in phase II development for ulcerative colitis, while Zenpep is marketed in the United States for exocrine pancreatic insufficiency due to cystic fibrosis and other conditions
AstraZeneca and Allergan had a license agreement for brazikumab, which is now terminated and all rights to this monoclonal antibody targeting IL23, go back to AstraZeneca. Financial terms of the transactions were not disclosed
Roche Seeks Approval of Tecentriq Combo in Liver Cancer: Roche submitted a supplemental biologics license application (sBLA) to the FDA seeking approval of its PD-L1 inhibitor, Tecentriq in combination with Avastin for the unresectable hepatocellular carcinoma (HCC), the most common form of liver cancer. The sBLA was based on data from the phase III IMbrave150 study, which demonstrated that the Tecentriq plus Avastin combo improved overall survival (OS) by 42% and progression-free survival (PFS) by 41% compared with standard of care, Bayer’s Nexavar (sorafenib). OS and PFS were the co-primary endpoints of the study.
AstraZeneca’s Enhertu Meets Goal in Gastric Cancer Study: AstraZeneca’s (AZN - Free Report) phase II study evaluating its newly approved cancer medicine, Enhertu (trastuzumab deruxtecan) in gastric cancer met the primary endpoint. Top-line data from the study showed that treatment with Enhertu led to statistically significant and clinically meaningful improvement in objective response rate (ORR) — primary endpoint and OS — a key secondary endpoint in patients with previously treated HER2-positive metastatic gastric cancer. Enhertu, which AstraZeneca is jointly developing and commercializing with Japan’s Daiichi Sankyo, was approved by the FDA for metastatic breast cancer in December.
AstraZeneca also announced an agreement to sell global commercial rights to some hypertension medicines, Inderal, Tenormin, Tenoretic, Zestril and Zestoretic to Atnahs Pharma to allow it to focus on its portfolio of new medicines. The agreement excludes the rights in the United States and India, which were previously divested, and in Japan, which will be retained by AstraZeneca.
Meanwhile, AstraZeneca’s blood thinner, Brilinta met primary endpoint in phase III THALES study in stroke. The data from the study showed that Brilinta in combination with aspirin led to a statistically significant and clinically meaningful reduction in the risk of the primary composite endpoint of stroke and death, in patients who had experienced a minor acute ischemic stroke or high-risk transient ischemic attack.
FDA Grants Approval to Merck’s Dificid for New Formulation and Pediatric Indication: Merck (MRK - Free Report) announced that the FDA has granted approval to two regulatory applications seeking expanded approval of its antibacterial medicine, Dificid. The first application was an NDA looking for approval of an oral suspension formulation of Dificid, which is presently available in tablet form. The second application was a sNDA looking for approval of Dificid for the treatment of pediatric patients aged 6 months or older with Clostridioides (formerly Clostridium) difficile-associated diarrhea..
Lilly’s Two Phase III Studies on Olumiant in Eczema Succeed: Lilly & Incyte’s two phase III studies evaluating their JAK inhibitor, Olumiant, in patients with moderate-to-severe atopic dermatitis (AD), met the primary endpoint of at least 75% improvement of skin inflammation. The primary endpoint of both the studies was defined by the proportion of participants achieving at least 75% or greater change from baseline in their Eczema Area and Severity Index (EASI) at week 16.
The BREEZE-AD4 study, which was conducted outside the United States, evaluated Olumiant (1-mg, 2-mg and 4-mg doses) in combination with topical corticosteroids (TCS) in patients with moderate-to-severe AD who failed conventional systemic treatments like cyclosporine. In the study, the 4-mg dose of baricitinib plus TCS met the primary endpoint. The BREEZE-AD5, conducted in North America, evaluated 1-mg and 2-mg doses of baricitinib as a monotherapy in AD patients. In this study, the 2-mg dose of baricitinib met the primary endpoint as well as some key secondary endpoints.
Olumiant, which is the presently marketed to treat active rheumatoid arthritis, is under review in Europe as a treatment for patients with moderate to severe atopic dermatitis. Lilly also plans to submit regulatory application in the United States for the atopic dermatitis indication this year. The data from the BREEZE-AD5 study will support the U.S. filing.
The FDA granted priority review status to Lilly’s new drug application (NDA) for its investigational oral RET inhibitor, selpercatinib. The NDA seeks approval of selpercatinib for RET-altered lung and thyroid cancers based on data from the LIBRETTO-001 phase I/II study. With the FDA granting priority review to the NDA, a decision is expected in the third quarter of this year.
The FDA also approved Lilly and partner, Boehringer Ingelheim’s Trijardy XR, a triple-combination tablet, for adults with type II diabetes. Trijardy XR, a once daily therapy provides three type II diabetes medicines, Jardiance, Tradjenta and metformin hydrochloride extended release, in one pill. Trijardy XR will be available in four different dosages.
The NYSE ARCA Pharmaceutical Index declined 1.8% 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.
Last week, J&J recorded the maximum gain (1.2%) while Pfizer declined the most (9.0%).
In the past six months, Bristol-Myers has risen the most (41.2%) while Pfizer (PFE - Free Report) lost the maximum (3.1%).
(See the last pharma stock roundup here: J&J’s Mixed Q4, Roche & Novartis’ New Drugs Approval in EU)
What's Next in the Pharma World?
Watch out for fourth-quarter 2019 results of Bristol-Myers, AbbVie, Merck and regular pipeline and regulatory updates next week.
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This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
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