Good news flowed in at Bayer (BAYRY)/Amgen Inc. (AMGN) when the U.S. Food and Drug Administration (:FDA) approved their drug Nexavar for an additional indication. The drug was approved for the treatment of patients suffering from locally recurrent or metastatic, progressive, differentiated thyroid carcinoma refractory to radioactive iodine therapy.
In Aug 2013, Nexavar was granted priority review designation in the U.S. We note that the U.S. regulatory authority generally reviews those drugs on a priority basis which offer major advances in treating diseases having no adequate therapy.
The U.S. approval of Nexavar was based on positive results from the phase III DECISION (stuDy of sorafEnib in loCally advanced or metastatIc patientS with radioactive Iodine refractory thyrOid caNcer) trial. Results from the study revealed a significant increase in median progression-free survival for patients treated with Nexavar compared to patients under placebo. Data revealed a 41% reduction in the risk of disease progression or death for patients receiving Nexavar compared to those in the placebo arm.
Nexavar is already a key oncology product at Bayer and is approved for liver cancer and advanced kidney cancer in over 100 countries around the globe. In the EU, the drug is approved for two other indications – for the treatment of hepatocellular carcinoma and for the treatment of patients suffering from advanced renal cell carcinoma who have an unsuccessful interferon-alpha or interleukin-2 based therapy.
Bayer reported Nexavar sales of €204 million in the third quarter of 2013, up 11.1% year over year on an adjusted basis. We expect Nexavar sales to be boosted further with the label expansion. However, the oncology market is extremely competitive given the presence of companies like Roche (RHHBY).
Bayer, a large cap pharma company, presently carries a Zacks Rank #2 (Buy) and so does Amgen. Another large-cap stock, Johnson & Johnson (JNJ), also holds a comparable rank.
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