Actelion hits 6-yr high after favourable FDA approval for drug

Reuters

ZURICH, Oct 21 (Reuters) - Shares in Swiss group Actelion climbed more than five percent to their highest sincelate 2007 on Monday on optimism it has a viable product tosecure sales and profit after U.S. approval for a new heart andlung drug with a favourable label.

The Food and Drug Administration approved the Swiss biotechcompany's pulmonary arterial hypertension (PAH) drug Opsumitlate on Friday and, notably, did not impose a black box warningrequiring ongoing mandatory liver testing.

This gives the medicine an advantage over Actelion's olderproduct and current main seller, Tracleer, which had sales of1.5 billion Swiss francs ($1.66 billion) in 2012 but losespatent protection from 2015.

"Opsumit's FDA approved label is close to a best caseoutcome, in our view," said Deutsche Bank analyst RichardParkes, who has a 'buy' rating on the stock and raised his pricetarget to 72 francs from 70 francs.

Shares in Actelion were up 5.3 percent at 68.00 francs by0752 GMT, outperforming a 0.5 percent firmer European healthcaresector index.

Analysts at Jefferies agreed and said the drug had the"unique indications" of delaying disease progression andreducing hospitalisation due to PAH.

The brokerage, which forecasts peak sales of $1.4 billionassuming a 40 percent new PAH patient share at a 15 percentprice discount to Tracleer and Gilead Sciences' rivaldrug Letairis, also raised its price target to 79 francs from 71francs.

Analysts at Berenberg were more cautious and said therequirement for doctors to carry out pre-therapy liver testingbefore prescribing Opsumit was slightly more burdensome thanwhat is required for Letairis.

Pulmonary arterial hypertension, or PAH, is characterised byhigh blood pressure in the arteries connecting the heart to thelungs, which causes the right side of the heart to work harderthan normal and leads to shortness of breath.

Opsumit belongs to a class of drugs known as endothelinreceptor antagonists, which relax the pulmonary arteries anddecrease that pressure.

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