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Astellas and Merck Collaborate

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Astellas Pharma Inc. recently joined forces with Merck & Co. Inc. (MRK - Free Report) for the co-promotion of its sodium-glucose co-transporter 2 (SGLT2) inhibitor, ipragliflozin (ASP1941).

As per the terms of the agreement, Merck will co-promote ipragliflozin with Astellas and Kotobuki Pharmaceutical Co., Ltd. Astellas will be solely responsible for the manufacture and sale of ipragliflozin. We remind investors that Astellas and Kotobuki Pharmaceutical Co., Ltd already have a research collaboration for ipragliflozin.

We note that Astellas submitted a marketing authorization application for ipragliflozin, to the Ministry of Health, Labour and Welfare in Japan, in Mar 2013. Astellas is looking to get ipragliflozin approved for the treatment of type II diabetes.

The application was based on a phase III pivotal study on ipragliflozin as monotherapy for the treatment of type II diabetes. The study showed a significant reduction in HbA1c levels. Astellas conducted six phase III studies to investigate the long-term safety and efficacy of ipragliflozin in combination with other hypoglycemic agents. Results showed effectiveness and a favorable safety profile.

The approval of ipragliflozin in Japan will enhance Astellas’ portfolio.

We note that Astellas was in the news recently when it launched Astagraf XL in the U.S. Astagraf XL was approved in the U.S. in Jul 2013 for the prophylaxis of organ rejection in patients receiving a kidney transplant used with mycophenolate mofetil (MMF) and corticosteroids, with or without basiliximab induction.

Astellas carries a Zacks Rank #3 (Hold). Both the companies have significant experience in the diabetes market.Other stocks that look attractive include Biogen Idec Inc. (BIIB - Free Report) and Affymetrix Inc. . Both these stocks carry a Zacks Rank #1 (Strong Buy).

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