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Novartis (NVS - Snapshot Report) recently announced that the US Food and Drug Administration (FDA) has approved Ilaris (canakinumab) for an additional indication.

Ilaris is now approved for the treatment of active systemic juvenile idiopathic arthritis (SJIA) in patients AGED 2 years and above in the US.

The approval was based on encouraging data from two phase III trials in SJIA patients (2 to 19 years) wherein a majority of Ilaris-treated patients showed considerable improvement. 

SJIA is the most severe type of juvenile idiopathic arthritis (JIA). We note that Ilaris is already approved in the US for the treatment of cryopyrin-associated periodic syndromes (CAPS).

Additionally, Novartis had filed for regulatory approval of Ilaris in the EU and the US in 2011 for the treatment of patients suffering from acute attacks of gout based on positive data from two phase III registration studies. In Mar 2013, Ilaris was approved by the EU for treating patients with acute gouty arthritis who suffer frequent attacks and their symptoms cannot be managed by the available treatment options.

However, the FDA approval is still pending for this indication. In Aug 2011, Novartis received a Complete Response Letter (CRL) from the US Food and Drug Administration 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.

Meanwhile, Ilaris is also being studied for a number of rare autoinflammatory conditions, including tumor necrosis factor receptor-associated periodic syndrome, colchicine-resistant familial mediterranean fever) and hyper IgD syndrome.

Ilaris generated sales of $24 million in the first quarter of 2013, up 54% year over year. The FDA approval for SJIA should boost sales further in our view.

Novartis currently carries a Zacks Rank #3 (Hold). Right now, Santarus Inc. , Jazz Pharmaceuticals (JAZZ - Analyst Report) and Salix Pharmaceuticals (SLXP - Analyst Report) look attractive. All three carry a Zacks Rank #1(Strong Buy).

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