Novartis AG (NVS - Free Report) announced that the European Commission (EC) approved Luxturna, a one-time gene therapy, for the treatment of patients suffering from vision loss due to a genetic mutation in both copies of the RPE65gene and who have enough viable retinal cells.
The EC decision was based on positive CHMP opinion. Data from a phase I clinical trial, its follow-up trial, and the first randomized, controlled phase III gene therapy trial for an inherited disease supported the decision. Data from the phase III trial showed that vision improvement was recorded as early as 30 days following the treatment.
We remind investors that Luxturna was developed and is commercialized in the United States by Spark Therapeutics. Novartis and Spark Therapeutics entered into a licensing and supply agreement in January 2018 for the development, registration and commercialization rights to Luxturna in markets outside the United States. Per the agreement, Novartis can commercialize Luxturna in the EU/EEA. The company already owns exclusive rights to development, registration and commercialization of the gene therapy in all other countries outside the United States, and Spark Therapeutics will supply it to Novartis.
The FDA approved Luxturna for the same indication in December 2017.
Gene therapy has gained a lot of attention of late, and is set to become one of the most promising spaces. Earlier this year, Novartis acquired gene-therapy company, AveXis, Inc. AveXis’ lead product candidate, AVXS-101 is being evaluated as a one-time gene replacement therapy for spinal muscular atrophy (SMA), a disease that results in early death or life-long disability with considerable healthcare costs. Regulatory submissions of AVXS-101 have been made in the United States, EU and Japan, for type 1 SMA, based on the phase I data and select data from the ongoing phase III study, STR1VE. Novartis plans to launch AVXS-101 by mid-2019.
Other companies like Axovant Sciences and uniQure N.V. (QURE - Free Report) have been steadily developing their pipeline candidates using gene therapy.
Approval of new drugs and label expansion of existing drugs bode well for Novartis as its key drugs are facing generic competition.
The company’s shares have gained 9.9% in the year so far on par with the industry’s growth.
Of late, Novartis is redirecting its focus to core areas of growth. Earlier, the company announced that it intends to spin-off its ophthalmology division, Alcon, into a separately-traded standalone company to grow as a medicines company solely.
Zacks Rank & Key Pick
Novartis carries a Zacks Rank #3 (Hold). A better-ranked stock in the healthcare sector is Gilead Sciences, Inc. (GILD - Free Report) , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Gilead’s earnings per share estimates increased from $6.60 to $6.91 for 2018 over the past 60 days. Estimates for 2019 are also up by 29 cents.
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