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This week, several drugmakers — Merck (MRK - Free Report) , AbbVie (ABBV - Free Report) , Bayer and Novo Nordisk — announced their second-quarter earnings. Sanofi (SNY - Free Report) /Glaxo (GSK - Free Report) and J&J (JNJ - Free Report) announced deals with the U.S. government to supply their respective coronavirus candidates, if approved.
Recap of the Week’s Most Important Stories
Earnings Update: Merck’s second-quarter results were mixed as the company beat estimates for earnings but missed the same for sales. Earnings rose 6% year over year while revenues declined 8% as sales of several medicines were hurt due to COVID-19. The company raised its earnings and sales guidance for the year.
AbbVie beat estimates for both earnings and sales. Earnings rose 3.5% year over year while total revenues declined 5.3%, on an operational basis, due to the COVID-19 pandemic. AbbVie issued new EPS guidance for 2020 to include results of Allergan, which it acquired this year.
Bayer’s second-quarter sales declined year over year. While sales of its Crop Science segment rose 3.2% on an Fx and portfolio adjusted basis, revenues at the Pharmaceuticals segment decreased 8.8% due to the negative impact of COVID-19. Consumer Health sales were down1.9%. The company lowered its earnings and sales expectations for the year.
Novo Nordisk’s earnings beat estimates while sales missed the same. Diabetes and Obesity Care segment sales grew 1%, while Biopharma unit sales declined 3%. Novo Nordisk maintained its sales outlook for 2020. It expects 3-6% sales growth at CER
Sanofi/Glaxo & J&J to Supply Coronavirus Vaccine to U.S. Government: Sanofi and Glaxo have also been selected for Operation Warp Speed program to supply the United States government with 100 million doses of their COVID-19 vaccine, which the companies are developing together. The U.S. government will provide funding of $2.1 billion for the development and manufacturing of the initial 100 million doses. The U.S. government also has an option to purchase an additional 500 million doses
Sanofi and Glaxo are also in advanced discussion with the European Commission to supply up to 300 million doses of their COVID-19 vaccine to European countries. The doses will be manufactured in European countries including France, Belgium, Germany and Italy.
Sanofi is combining its recombinant protein-based technology with Glaxo’s pandemic adjuvant technology to develop an adjuvanted COVID-19 vaccine.
The vaccine candidate is expected to enter clinical studies (phase I/II) in September 2020 with a phase III study expected to start by the end of the year. The vaccine, if successfully developed, will be available in the second half of 2021. The agreement is subject to final contract.
Similarly, J&J announced an agreement with the U.S. government to supply 100 million doses of its investigational COVID-19 vaccine candidate, Ad26.COV2.S, following approval or emergency use authorization by the FDA. The candidate is presently being evaluated in a phase I/IIa study. J&J has a goal to supply more than one billion doses globally, if the vaccine is approved.
Lilly Begins Late-Stage Study on Coronavirus Candidate in Nursing Homes: Lilly (LLY - Free Report) initiated a phase III (BLAZE-2) study on LYCoV555, the lead antibody from its collaboration with AbCellera, for prevention of COVID-19 at long-term care facilities, more commonly known as nursing homes. The study will be conducted in partnership with the National Institute of Allergy and Infectious Diseases (NIAID). The study will enrol 2,400 residents and staff at nursing homes who live or work at these facilities where a recently diagnosed case of COVID-19 has been reported and who are now vulnerable to get the infection.
Lilly completed dosing of a phase I study on LYCoV555 in hospitalized patients with COVID-19 and has initiated a phase II study (BLAZE-2) on the candidate in people recently diagnosed with COVID-19 in the ambulatory setting.
FDA Approves Glaxo’s belantamab mafodotin and J&J’s Spravato for Expanded Use: The FDA granted approval to Glaxo’s belantamab mafodotin for the treatment of relapsed/refractory multiple myeloma in patients who have been previously treated with an immunomodulatory agent, a proteasome inhibitor and an anti-CD38 antibody. The new drug will be marketed by the trade name of Blenrep
The FDA granted approval to J&J’s supplemental new drug application (sNDA) seeking label expansion of Spravato (esketamine) nasal spray to treat adult patients with major depressive disorder who have active suicidal ideation with intent. Spravato is the only medicine, which has shown improving depressive symptoms with the first dose in this difficult-to treat patient population.
Merck Licensing Deal for NASH Candidate: Merck acquired an exclusive license from Hanmi Pharmaceutical to develop the latter’s efinopegdutide, an investigational once-weekly therapy for nonalcoholic steatohepatitis (NASH), in the United States and globally. For the deal, Merck will pay Hanmi an upfront payment of $10 million while the latter will also be eligible to receive development/regulatory milestone payments up to $860 million
Novartis’ Kymriah Meets Goal in Follicular Lymphoma Study: Novartis’ phase II ELARA trial evaluating its CAR-T cell therapy, Kymriah in patients with relapsed or refractory (r/r) follicular lymphoma (FL), met its primary endpoint of complete response rate at interim analysis. Data from the ELARA study will be included in regulatory applications seeking approval of Kymriah for the FL indication. Kymriah is presently approved to treat r/r acute lymphoblastic leukemia (ALL) and r/r diffuse large B-cell lymphoma (DLBCL).
Meanwhile, the European Commission granted approval to Novartis Cosentyx for the first-line treatment of moderate-to-severe plaque psoriasis for the paediatric patient population. The regulatory body also granted approval to Xolair for a new indication to treat severe chronic rhinosinusitis with nasal polyps. Xolair is presently approved to treat moderate-to-severe or severe persistent allergic asthma and chronic idiopathic urticaria.
Roche’s Tecentriq Breast Cancer Study Fails: Roche’s phase III study evaluating its PD-L1 inhibitor Tecentriq in combination with paclitaxel for the first-line treatment of metastatic triple-negative breast cancer did not meet statistical significance on its primary endpoint of progression-free survival (PFS). Meanwhile, though data for the secondary endpoint of overall survival was immature at the time of analysis, Roche mentioned that it showed a negative trend.
The NYSE ARCA Pharmaceutical Index rose 2.9% in the last five trading sessions.
Watch out for regular pipeline and regulatory updates next week.
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Image: Bigstock
Pharma Stock Roundup: ABBV, MRK Q2 Earnings & Coronavirus Updates in Focus
This week, several drugmakers — Merck (MRK - Free Report) , AbbVie (ABBV - Free Report) , Bayer and Novo Nordisk — announced their second-quarter earnings. Sanofi (SNY - Free Report) /Glaxo (GSK - Free Report) and J&J (JNJ - Free Report) announced deals with the U.S. government to supply their respective coronavirus candidates, if approved.
Recap of the Week’s Most Important Stories
Earnings Update: Merck’s second-quarter results were mixed as the company beat estimates for earnings but missed the same for sales. Earnings rose 6% year over year while revenues declined 8% as sales of several medicines were hurt due to COVID-19. The company raised its earnings and sales guidance for the year.
AbbVie beat estimates for both earnings and sales. Earnings rose 3.5% year over year while total revenues declined 5.3%, on an operational basis, due to the COVID-19 pandemic. AbbVie issued new EPS guidance for 2020 to include results of Allergan, which it acquired this year.
Bayer’s second-quarter sales declined year over year. While sales of its Crop Science segment rose 3.2% on an Fx and portfolio adjusted basis, revenues at the Pharmaceuticals segment decreased 8.8% due to the negative impact of COVID-19. Consumer Health sales were down1.9%. The company lowered its earnings and sales expectations for the year.
Novo Nordisk’s earnings beat estimates while sales missed the same. Diabetes and Obesity Care segment sales grew 1%, while Biopharma unit sales declined 3%. Novo Nordisk maintained its sales outlook for 2020. It expects 3-6% sales growth at CER
Sanofi/Glaxo & J&J to Supply Coronavirus Vaccine to U.S. Government: Sanofi and Glaxo have also been selected for Operation Warp Speed program to supply the United States government with 100 million doses of their COVID-19 vaccine, which the companies are developing together. The U.S. government will provide funding of $2.1 billion for the development and manufacturing of the initial 100 million doses. The U.S. government also has an option to purchase an additional 500 million doses
Sanofi and Glaxo are also in advanced discussion with the European Commission to supply up to 300 million doses of their COVID-19 vaccine to European countries. The doses will be manufactured in European countries including France, Belgium, Germany and Italy.
Sanofi is combining its recombinant protein-based technology with Glaxo’s pandemic adjuvant technology to develop an adjuvanted COVID-19 vaccine.
The vaccine candidate is expected to enter clinical studies (phase I/II) in September 2020 with a phase III study expected to start by the end of the year. The vaccine, if successfully developed, will be available in the second half of 2021. The agreement is subject to final contract.
Similarly, J&J announced an agreement with the U.S. government to supply 100 million doses of its investigational COVID-19 vaccine candidate, Ad26.COV2.S, following approval or emergency use authorization by the FDA. The candidate is presently being evaluated in a phase I/IIa study. J&J has a goal to supply more than one billion doses globally, if the vaccine is approved.
Lilly Begins Late-Stage Study on Coronavirus Candidate in Nursing Homes: Lilly (LLY - Free Report) initiated a phase III (BLAZE-2) study on LYCoV555, the lead antibody from its collaboration with AbCellera, for prevention of COVID-19 at long-term care facilities, more commonly known as nursing homes. The study will be conducted in partnership with the National Institute of Allergy and Infectious Diseases (NIAID). The study will enrol 2,400 residents and staff at nursing homes who live or work at these facilities where a recently diagnosed case of COVID-19 has been reported and who are now vulnerable to get the infection.
Lilly completed dosing of a phase I study on LYCoV555 in hospitalized patients with COVID-19 and has initiated a phase II study (BLAZE-2) on the candidate in people recently diagnosed with COVID-19 in the ambulatory setting.
FDA Approves Glaxo’s belantamab mafodotin and J&J’s Spravato for Expanded Use: The FDA granted approval to Glaxo’s belantamab mafodotin for the treatment of relapsed/refractory multiple myeloma in patients who have been previously treated with an immunomodulatory agent, a proteasome inhibitor and an anti-CD38 antibody. The new drug will be marketed by the trade name of Blenrep
The FDA granted approval to J&J’s supplemental new drug application (sNDA) seeking label expansion of Spravato (esketamine) nasal spray to treat adult patients with major depressive disorder who have active suicidal ideation with intent. Spravato is the only medicine, which has shown improving depressive symptoms with the first dose in this difficult-to treat patient population.
Merck Licensing Deal for NASH Candidate: Merck acquired an exclusive license from Hanmi Pharmaceutical to develop the latter’s efinopegdutide, an investigational once-weekly therapy for nonalcoholic steatohepatitis (NASH), in the United States and globally. For the deal, Merck will pay Hanmi an upfront payment of $10 million while the latter will also be eligible to receive development/regulatory milestone payments up to $860 million
Novartis’ Kymriah Meets Goal in Follicular Lymphoma Study: Novartis’ phase II ELARA trial evaluating its CAR-T cell therapy, Kymriah in patients with relapsed or refractory (r/r) follicular lymphoma (FL), met its primary endpoint of complete response rate at interim analysis. Data from the ELARA study will be included in regulatory applications seeking approval of Kymriah for the FL indication. Kymriah is presently approved to treat r/r acute lymphoblastic leukemia (ALL) and r/r diffuse large B-cell lymphoma (DLBCL).
Meanwhile, the European Commission granted approval to Novartis Cosentyx for the first-line treatment of moderate-to-severe plaque psoriasis for the paediatric patient population. The regulatory body also granted approval to Xolair for a new indication to treat severe chronic rhinosinusitis with nasal polyps. Xolair is presently approved to treat moderate-to-severe or severe persistent allergic asthma and chronic idiopathic urticaria.
Roche’s Tecentriq Breast Cancer Study Fails: Roche’s phase III study evaluating its PD-L1 inhibitor Tecentriq in combination with paclitaxel for the first-line treatment of metastatic triple-negative breast cancer did not meet statistical significance on its primary endpoint of progression-free survival (PFS). Meanwhile, though data for the secondary endpoint of overall survival was immature at the time of analysis, Roche mentioned that it showed a negative trend.
The NYSE ARCA Pharmaceutical Index rose 2.9% in the last five trading sessions.
Large Cap Pharmaceuticals Industry 5YR % Return
Large Cap Pharmaceuticals Industry 5YR % Return
Here is how the eight major stocks performed in the last five trading sessions.
Last week, Merck recorded the highest increase (2.7%) while Lilly declined the most (3.6%).
In the past six months, AstraZeneca (AZN) has risen the most (12.6%) while Novartis has declined the most (14.4%).
(See the last pharma stock roundup here: Q2 Earnings & J&J and PFE’s Coronavirus Updates in Focus)
What's Next in the Pharma World?
Watch out for regular pipeline and regulatory updates next week.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.3% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>