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Novartis (NVS - Analyst Report) recently announced that the European Commission (EC) has approved its drug llaris (canakinumab, ACZ885) for an additional indication. The EC cleared llaris for treating adults suffering from gouty arthritis (gout) - a serious, chronic and progressive inflammatory disease.

Patients experience attacks of gout when the body has a strong inflammatory response to the uric acid crystals forming in the affected joint. Moreover, the symptoms of such attacks cannot or should not be managed with existing therapies.  

Novartis stated in its press release that the approval of Ilaris makes it the first biologic to be cleared in the EU for symptomatic pain relief in a gouty arthritis indication. In addition, Novartis has received an additional year of data exclusivity from the EC, which was determined by the significant clinical benefit that Ilaris provides over existing treatments.

The approval does not come as a surprise since in Jan 2013 the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) had recommended the approval of Ilaris for the indication.

The EU approval was based on data from two phase III trials and their extensions, which demonstrated that patients treated with Ilaris experienced significantly greater pain relief compared to the injectable steroid triamcinolone acetonideno.

We note that Ilaris is already approved for treating children and adults suffering from cryopyrin associated periodic syndrome (CAPS) in the EU, US, Switzerland and Japan.

However, the approval process in the US has been bumpy. In Aug 2011, Novartis received a Complete Response Letter (CRL) from the US Food and Drug Administration (FDA) asking for additional information to evaluate the risk benefit profile in refractory gout patients. Novartis continues to work with the FDA to determine the next steps for llaris in the gout indication.

Novartis carries a Zacks Rank #3 (Hold). Pharma stocks, which currently look attractive are Eli Lilly & Co (LLY - Analyst Report), Mylan Inc. (MYL - Analyst Report) and Shire plc (SHPG - Analyst Report) each carrying a Zacks Rank #2 (Buy).

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