Bayer’s ( BAYRY - Analyst Report ) Healthcare unit and its partner Johnson & Johnson ( JNJ - Analyst Report ) recently initiated a phase III study (COMMANDER-HF) on Xarelto (rivaroxaban) in patients suffering from heart failure (HF) and significant coronary artery disease (CAD).

Xarelto is marketed by Johnson & Johnson in the US and by Bayer outside the US.

Bayer will be evaluating the safety and efficacy of Xarelto in reducing the risk of death, myocardial infarction (MI) or stroke, in comparison to placebo. The company will enroll 5,000 patients suffering from chronic HF and significant CAD following hospitalization, for the study.

The US Food and Drug Administration (FDA) has already granted fast track designation for this indication of Xarelto.

Bayer also initiated a phase IIIb (PIONEER AF-PCI) study on Xarelto for the treatment of patients suffering from non-valvular atrial fibrillation (AF) who underwent percutaneous coronary intervention (PCI) with stent placement. The company is expected to enroll around 2,100 patients for the study worldwide.

We note that Bayer and Johnson & Johnson received a huge setback recently with the FDA issuing a second complete response letter (CRL) for the supplemental New Drug Application (sNDA) for Xarelto (2.5 mg twice daily) for the reduction of the risk of secondary cardiovascular events in patients suffering from acute coronary syndrome (ACS). Bayer is currently evaluating the CRL with Johnson & Johnson and intends to respond to the US regulatory authority soon.

We note that Xarelto is already approved for several indications in the US including stroke prevention in nonvalvular atrial fibrillation, deep vein thrombosis (DVT), pulmonary embolism (PE) and reducing the risk of recurrent DVT and PE. The drug performed impressively last year. In 2012, Xarelto sales increased 265.9% year over year to €322 million (approximately $414.1 million).

Bayer, a large cap pharma company, currently carries a Zacks Rank #3 (Hold). Meanwhile, other large cap pharma stocks such as Eli Lilly and Company ( LLY - Analyst Report ) and Novo Nordisk ( NVO - Analyst Report ) are bettered positioned carrying a Zacks Rank #2 (Buy).