Vertex Pharmaceuticals Inc. (VRTX - Free Report) announced that the Committee for Medicinal Products for Human Use ("CHMP") has recommended approval of a label expansion for Orkambi in Europe. The company is seeking extension of its marketing authorization for Orkambi to include use in children with cystic fibrosis ("CF") who are aged between 6 and 11 years and have two copies of the F508del mutation.
We note that the European Commission generally follows the recommendation of the CHMP but is not bound by it. A decision is typically expected within three months of recommendation.
We remind investors that Orkambi is currently approved in the EU for the treatment of CF in patients aged 12 years and above who have two copies of the F508del mutation in their CF transmembrane conductance regulator ("CFTR") gene.
Vertex’s stock has outperformed the industry so far this year. Shares are up 101.9% compared with the industry’s gain of 2.3% in the period.
The company believes that the label expansion will increase the eligible patient population by 3400 in Europe. The drug is already approved in the United States for this indication.
Orkambi generated net sales of $955.5 million in the first nine months of 2017, growing over 35% from the year-ago period. The potential label expansion will further boost the drug’s sales.
Meanwhile, the company has completed part 2 of a phase III study evaluating Orkambi in CF patients of two to five years of age who have two copies of the F508del mutation in their CFTR gene. Last month the company announced that the study met its primary endpoint of safety. Vertex expects to file applications for expanding Orkambi’s label in this patient population to the regulatory authorities in the United States and Europe in the first quarter of 2018.
CF, a rare, life-threatening disease, is estimated to affect approximately 75,000 people in the United States, Europe and Australia. Vertex currently has another CF drug, Kalydeco, in its portfolio. The company generated CF product revenues of more than $1.5 billion, including sales of Kalydeco and Orkambi, in the first nine months of 2017.
Moreover, to boost its CF portfolio and curb competition Vertex bought Concert Pharmaceuticals, Inc.’s (CNCE - Free Report) CF candidate, CTP-656, in July 2017.
The CF market has been attracting lot of interest with several companies developing their candidates as potential therapy for patients.
Zacks Rank & Stocks to Consider
Vertex carries a Zacks Rank #3 (Hold).
A couple of better-ranked health care stocks include Ophthotech Corporation (OPHT - Free Report) and Ligand Pharmaceuticals Inc. (LGND - Free Report) . While Ophthotech sports a Zacks Rank #1 (Strong Buy), Ligand carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Ophthotech’s earnings per share estimates have moved up from 81 cents to $2.31 for 2017 over the last 30 days. The company delivered a positive earnings surprise in all the trailing four quarters, with an average beat of 14.23%.
Ligand’s earnings per share estimates have moved up from $3.68 to $3.70 for 2018 over the last 60 days. The company pulled off a positive earnings surprise in two of the trailing four quarters, with an average beat of 8.22%. The share price of the company has increased 37.7% year to date.
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