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Analyst Blog

Keryx Biopharmaceuticals Inc.’s (KERX - Free Report) shares rallied 3.8% on the company’s announcement of additional data from a phase III study on Auryxia for the treatment of iron deficiency anemia (IDA) in patients suffering from stage III–V non-dialysis dependent chronic kidney disease (NDD-CKD).

Results demonstrated that patients treated with Auryxia achieved the primary endpoint of ≥1 g/dL increase in hemoglobin at any point during the 16-week efficacy period and the majority of these patients revealed a sustained treatment effect. Findings from the study support a supplemental new drug application (sNDA) to expand Auryxia’s label, which is expected to be filed soon.

According to information provided by the company in its press release, it is estimated that approximately 1.6 million individuals are living in the U.S. with stage III–V NDD-CKD and IDA.

Note that Auryxia is approved in the U.S. (Sep 2014) for the control of serum phosphorus levels in patients with CKD on dialysis. In the first nine months of 2016, Auryxia generated sales of $18.9 million, up substantially from $5.4 million in the year-ago comparable period.

Recently, Keryx received a boost when the FDA approved the company’s application for a second drug product manufacturer, Patheon Manufacturing Services, for supplying Auryxia as a finished product.

We remind investors that earlier this year, the company announced an interruption in the supply of Auryxia as its contract manufacturer had issues related to the conversion of the active pharmaceutical ingredient into the finished product, leading to a disruption in the supply of Auryxia.

Approval for a second drug product manufacturer should solve the supply issues related to Auryxia. Going forward, we expect investors to focus on further updates from the company related to its submission of an sNDA for a potential label expansion of Auryxia.

Zacks Rank & Key Picks

Keryx currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the health care sector include Anika Therapeutics Inc. (ANIK - Free Report) , Cambrex Corp. (CBM - Free Report) and Vanda Pharmaceuticals, Inc. (VNDA - Free Report) . Cambrex and Vanda currently carry Zacks Rank #1 (Strong Buy), while Anika is a Zacks Rank #2 (Buy) stock. You can see the complete list of today’s Zacks #1 Rank stocks here.

Anika’s earnings estimates increased from $1.96 to $2.06 for 2016 and from $2.03 to $2.09 for 2017 over the last 60 days. The company posted a positive surprise in all of the four trailing quarters with an average beat of 33.14%.

Cambrex’s earnings estimates have increased from $2.46 to $2.55 for 2016 and from $2.91 to $3.06 for 2017 over the last 60 days. The company has posted a positive earnings surprise in three of the trailing four quarters with an average beat of 19.78%.

Vanda’s loss estimates narrowed from 68 cents to 56 cents for 2016 over the last 60 days, while its earnings estimates increased from 16 cents to 17 cents for 2017. The company posted a positive earnings surprise in three of the last four quarters with an average beat of 56.65%.

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