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5 Biotech and Pharma Stocks with FDA Catalysts this December

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2017 has been a pretty good year for pharma and biotech stocks where FDA decisions are concerned. The regulatory body has approved 40 novel drugs so far in 2017, easily surpassing last year’s total tally of 22.

There were quite a few landmark approvals this year including the approval of a couple of gene-based therapies for cancer – Novartis’s (NVS - Free Report) Kymriah for the treatment of certain pediatric and young adult patients with a form of acute lymphoblastic leukemia (“ALL”) and Gilead Sciences’s (GILD - Free Report) Yescarta, a cell-based gene therapy for the treatment of adult patients with certain types of large B-cell lymphoma who have not responded to or who have relapsed after at least two other kinds of treatment. These therapies have the potential to change the way we look at cancer treatments.

Other key approvals this year include Lilly’s Verzenio (advanced or metastatic breast cancer), Gilead’s Vosevi (hepatitis C virus), Puma’s Nerlynx (to reduce the risk of breast cancer returning), J&J’s Tremfya (moderate-to-severe plaque psoriasis), Regeneron/Sanofi’s Kevzara (rheumatoid arthritis), Roche’s multiple sclerosis treatment, Ocrevus, Regeneron and Sanofi’s eczema treatment, Dupixent, Tesaro’s PARP inhibitor, Zejula, and BioMarin’s Brineura (treatment of a specific form of Batten disease) among others. Quite a few of these drugs have blockbuster potential.

With the drug development process being lengthy and time-consuming and requiring the utilization of a lot of funds and resources, key pipeline events including data readouts and regulatory updates are of paramount importance and could act as major catalysts. Here is a look at a few important regulatory events scheduled for the month of December.

Cardiovascular Outcomes Data to be Part of Amgen’s PCSK9 Inhibitor Label? Amgen (AMGN - Free Report) is looking to add cardiovascular outcomes data to the label of its PCSK9 inhibitor, Repatha. With the FDA granting priority review to the company’s regulatory application, a response should be out on December 2.

With cardiovascular disease being the leading cause of death around the world, the addition of this data to Repatha’s label could boost the product’s sales. Sales of PCSK9 inhibitors, which were once considered to be worth multi-billion dollars, are yet to ramp up significantly. Repatha sales in the first nine months of 2017 were $221 million.

Amgen continues to work with payers to improve patient access to Repatha. If the FDA allows the addition of the cardiovascular outcomes data to the label, the company will be in a position to promote Repatha's ability to reduce the risk of cardiovascular events like heart attacks and strokes.

Amgen’s shares are up 17.8% year to date, substantially outperforming the 1.4% gain recorded by the industry it belongs to. While Amgen is a Zacks Rank #3 (Hold) stock, you can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Will the FDA Approve Mylan’s Herceptin Biosimilar? Mylan (MYL - Free Report) and partner Biocon should also get a response from the FDA for their biosimilar version of Roche’s blockbuster cancer drug, Herceptin (trastuzumab) this month. The FDA, which had previously extended the target action date for the biosimilar in order to review some clarificatory information provided by the companies, is expected to give a response on December 3.   

We remind investors that earlier this year in July, the FDA’s Oncologic Drugs Advisory Committee (“ODAC”) had voted in favor of approving the biosimilar. Although the FDA is not required to do so, it usually follows the recommendations of its advisory panels.

Mylan’s shares are down 3.4% year to date, compared to the 30.2% decline recorded by the industry it belongs to.

Will the FDA Follow its Advisory Panel’s Recommendation for NVO’s Diabetes Drug? Novo Nordisk (NVO - Free Report) , a key player in the diabetes market, will get to know the approval status of its latest diabetes product offering, semaglutide, this month. Once-weekly semaglutide is under FDA review for the improvement of glycemic control in adults with type II diabetes. With an FDA advisory panel voting in favor (16-0) of approval, chances of gaining approval look high.

Novo Nordisk’s shares are up 43.1% year to date, substantially outperforming the 16.2% gain recorded by the industry it belongs to.

Christmas Cheer for Aclaris? Aclaris Therapeutics (ACRS - Free Report) , which is focused on addressing significant unmet needs in medical and aesthetic dermatology, is seeking FDA approval for its lead pipeline candidate, A-101 40%, a topical treatment for seborrheic keratosis (“SK”). According to information provided by the company, 83.8 million people in the United States are affected by SK, a common non-malignant skin tumor, with current treatments (cryosurgery, curettage, electrodessication and excision) being painful or invasive. Timely approval would make A-101 40% the first FDA-approved medication for the treatment of SK. The FDA action date is December 24.

Aclaris’s shares are down 14.4% year to date, compared to the 3.9% rally of the industry it belongs to.

Valeant Eye Drop for Ocular Redness under Review: Valeant Pharmaceuticals International, Inc.'s New Drug Application (“NDA”) for Luminesse (brimonidine tartrate ophthalmic solution, 0.025%) is under FDA review with a PDUFA action date of December 27. The topical vasoconstrictor formulation has been developed to relieve redness of the eye due to minor eye irritations. If approved, the eye drop will be the first over-the-counter (“OTC”) product to be developed with brimonidine tartrate for the treatment of ocular redness.  

Valeant’s shares are up 13.3% year to date, compared to the 3.9% rally of the industry it belongs to.

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