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Novartis Gets EC Nod for Lung Cancer Drug's Label Expansion

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Novartis AG (NVS - Free Report) announced that the European Commission has approved a label expansion of oncology drug Zykadia.

The drug is now approved for the first-line treatment of patients with advanced non-small cell lung cancer (NSCLC) whose tumors are anaplastic lymphoma kinase (ALK)-positive.

An approval was on the cards as the Committee for Medicinal Products for Human Use (CHMP) had rendered a positive opinion on the same.

The first-line approval of Zykadia is based on positive results from an open-label, randomized multicenter global phase III trial ASCEND-4. The results showed that the study met its primary endpoint and demonstrated a 45% reduction in the risk of disease progression in the Zykadia arm, compared with the chemotherapy arm. Patients treated with first-line Zykadia had a median progression-free survival (PFS) of 16.6 months compared with 8.1 months for patients treated with standard first-line pemetrexed-platinum chemotherapy with pemetrexed maintenance.

We note that Zykadia is already approved for the treatment of adult patients with ALK+ advanced NSCLC previously treated with crizotinib. The FDA  also approved the expanded use of the drug for the same in May 2017.

As per estimates, lung cancer causes more deaths than colon, breast and prostate cancer combined. Approximately 1.8 million new cases of lung cancer are diagnosed every year.

Last week, the FDA approved Tafinlar (dabrafenib) in combination with Mekinist (trametinib) for the treatment of patients suffering from metastatic NSCLC whose tumors express the BRAF V600E mutation. We note that the Tafinlar + Mekinist combination was approved by the European Commission in Mar 2017 for the treatment of patients with BRAF V600 advanced mutation-positive NSCLC.

We remind investors that the combination of Tafinlar and Mekinist is already approved in the U.S. and EU for the treatment of patients with unresectable or MM who have a BRAF V600 mutation. Both Tafinlar and Mekinist are also approved individually as single agents for the treatment of patients with unresectable or metastatic melanoma.

Novartis broadened its oncology portfolio by acquiring GlaxoSmithKline plc’s (GSK - Free Report) certain oncology products and pipeline compounds in Mar 2015 after having divested its Animal Health Division to Eli Lilly and Co. (LLY - Free Report) . Both Tafinlar and Mekinist were acquired from Glaxo.

Merck’s (MRK - Free Report) Keytruda is also approved for the first-line treatment of patients with metastatic NSCLC whose tumors have high PD-L1 expression as determined by an FDA-approved test, with no EGFR or ALK genomic tumor aberrations.

Novartis has outperformed the Zacks classified industry in the last six months. The stock has rallied 17.0% compared with the Large Cap Pharmaceuticals industry’s gain of 13.8%.

Going forward, we expect that the approval of new drugs and label expansion of existing ones will bode well for Novartis. Also, strong performance of growth products should be able to offset the impact of generic competition for Gleevec.

Zacks Rank

Novartis currently carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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