FDA Accepts Pfizer sNDA

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Pfizer Inc.’s (PFE) supplemental new drug application (sNDA) for Xeljanz was recently accepted by the US Food and Drug Administration (:FDA) for review. The company is looking to expand the label to include inhibition of progression of structural damage. The FDA’s decision regarding the label expansion should be out by Feb 2014.

We note that Xeljanz was approved in the US in early Nov 2012 for the treatment of moderately to severely active rheumatoid arthritis (:RA) in adult patients who have not responded adequately to or cannot tolerate methotrexate (MTX). Xeljanz is the first oral treatment to gain approval in a new class of medicines known as Janus kinase (:JAK) inhibitors. The product represents a new treatment option for patients who respond inadequately to or are unable to tolerate MTX.

Xeljanz sales were $11 million in the first quarter of 2013. Pfizer said that initial Xeljanz trends are encouraging with rheumatologist prescriptions trending higher. The company also reported an increase in repeat prescriptions. Pfizer intends to commence a DTC campaign this summer.

Pfizer is currently evaluating Xeljanz for additional indications. Apart from the indication currently under review, Pfizer is evaluating Xeljanz in phase III studies for psoriasis with results due shortly. Positive results would allow the company to file for FDA approval early next year. Pfizer is also looking to move Xeljanz into a phase III study for psoriatic arthritis later this year.

While we are pleased with Xeljanz’ progress in the US, we note that it is yet to gain approval in the EU. In Apr 2013, Pfizer announced that the European Medicines Agency’s (:EMA) Committee for Medicinal Products for Human Use (CHMP) issued a negative opinion for Xeljanz for the treatment of adults with moderate-to-severe active RA.

According to the CHMP, Xeljanz's risk-benefit profile is not favorable currently and therefore should not be approved. Pfizer said that it will appeal this opinion and seek a re-examination of the same.

Pfizer currently carries a Zacks Rank #4 (Sell). The company recently lowered its earnings and revenue outlook for 2013 following the divestment of its stake in its former animal health business, Zoetis, Inc. (ZTS).

Among large-cap pharma companies, Novo Nordisk (NVO) currently looks well-positioned with a Zacks Rank #2 (Buy). Salix Pharmaceuticals (SLXP), which is a Zacks Rank #1 (Strong Buy) stock, also looks well-positioned.

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