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Amgen Xgeva Label Expanded

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Amgen (AMGN - Free Report) recently received approval from the US Food and Drug Administration (FDA) for an additional indication for Xgeva (denosumab). The FDA approved Xgeva for the treatment of giant cell tumor of bone (GCTB) that cannot be treated with surgery. Approval was granted for use in adults and skeletally mature adolescents.

Amgen had submitted its regulatory application in the US as well as the EU in Dec 2012. FDA approval was granted after a priority review was conducted.

Xgeva is currently approved for the prevention of skeletal-related events (SREs) in patients with bone metastases from solid tumors. Xgeva sales came in at $748 million in 2012. Amgen has been working on expanding Xgeva’s label into additional indications.

Xgeva is currently in phase III studies for the delay or prevention of bone metastases in patients with adjuvant breast cancer and prevention of SRE in patients with multiple myeloma. Last year, Amgen had received a complete response letter (CRL) from the FDA for its supplemental biologics license application s(BLA) for Xgeva for the delay of bone metastases in prostate cancer.

Denosumab is also approved under the trade name, Prolia, for the treatment of osteoporosis in postmenopausal women at increased risk of fractures or patients who have failed or are intolerant to other osteoporosis treatments.

Prolia is also approved for increasing bone mass in women at high risk for fracture receiving adjuvant aromatase inhibitor therapy for breast cancer and increasing bone mass in men at high risk for fracture receiving androgen deprivation therapy for non-metastatic prostate cancer. In Sep 2012, Prolia gained FDA approval as a treatment for increasing bone mass in men with osteoporosis at high risk for fracture.

Prolia is approved in the EU for the treatment of osteoporosis in postmenopausal women at higher risk of fractures and the treatment of bone loss associated with hormone ablation in men with prostate cancer at higher risk of fractures. Prolia sales were $472 million in 2012.

While approval for the GCTB indication is a positive for the company, we believe the main potential for boosting Xgeva sales lies in gaining approval for the prevention of bone metastases in prostate and breast cancer patients.

Amgen currently carries a Zacks Rank #3 (Hold). Amgen should be able to deliver on its long-term strategy based on expansion in key markets, launch of new manufacturing technologies, and pipeline development. However, nearer-term, we remain concerned about the performance of existing products. We expect 2013 and 2014 to be important years for Amgen with results on several key pipeline candidates.

Companies that currently look well-positioned include Biogen Idec (BIIB - Free Report) , Anika Therapeutics (ANIK - Free Report) , and Alexion Pharmaceuticals (ALXN - Free Report) . While Biogen and Anika are Rank #1 (Strong Buy) stocks, Alexion is a Rank #2 (Buy) stock.

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