Bayer's Adempas Cleared in the EU

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The European Commission approved Bayer’s (BAYRY) Adempas for the chronic thromboembolic pulmonary hypertension (:CTEPH) and pulmonary arterial hypertension (PAH) indications.

The drug is approved for the treatment of adults suffering from persistent/recurrent CTEPH or inoperable CTEPH following surgical treatment. The drug is also approved for the treatment of adults suffering from PAH as a monotherapy or in combination with endothelin receptor antagonists (ERA). Adempas enjoys orphan drug designation for both the indications in the EU. Adempas’ approval was based on positive results from two global phase III studies − CHEST-1 and PATENT-1 and also from the long-term data from CHEST-2 and PATENT-2 that was available at the time.

Bayer stated in its press release that Adempas is the first and only approved treatment for patients suffering from CTEPH who are not eligible for surgery or whose disease persists or reoccurs. We note that Adempas is already approved in the U.S and Canada for the CTEPH and PAH indications. Moreover, the drug is approved in Switzerland and Japan for the CTEPH indication.

We are encouraged by Bayer’s progress with Adempas. The drug is also being evaluated for other indications. For the last few quarters, Bayer’s HealthCare segment has been performing really well on the back of its newly launched products like Xarelto (anticoagulant), Eylea (eye drug), Stivarga (oncology), Xofigo (oncology) and Adempas. These new products are expected to contribute around €2.8 billion to segmental sales in 2014.

Bayer, in a separate press release, announced the initiation of two new phase III studies on Xarelto (rivaroxaban) in medically-ill patients and children at high risk for blood clots. One of the studies will evaluate the efficacy and safety of Xarelto in reducing the risk of post-hospital discharge symptomatic venous thromboembolism (:VTE) in patients hospitalized for acute medical illness while the second one will evaluate the efficacy and safety of Xarelto for the treatment and secondary prevention of VTE in children. Xarelto is already approved for several indications both in the U.S. and EU.

We are encouraged by the performance of Bayer’s newly launched pharmaceutical products so far. These products are expected to drive growth at the company. Label expansion of these drugs will drive growth further.

Bayer presently carries a Zacks Rank #4 (Sell). However, some better-ranked stocks include Alexion Pharmaceuticals, Inc. (ALXN), Alkermes (ALKS) and Actelion Ltd. (ALIOF). All these stocks carry a Zacks Rank #1 (Strong Buy).

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