Vertex Pharmaceuticals Up on Kalydeco sNDA Submission

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Vertex Pharmaceuticals Inc. (VRTX) gained 1.24% on the submission of a supplemental new drug application (sNDA) to the FDA for Kalydeco (ivacaftor) for the treatment of cystic fibrosis (CF) in patients (aged ≥18 years) with the R117H mutation in the cystic fibrosis transmembrane conductance regulator (:CFTR) gene.

Vertex Pharma filed the sNDA based on phase III study results. We note that although Kalydeco had not met the primary endpoint of mean absolute change from baseline compared to placebo in a phase III study in CF patients aged ≥6 years, a pre-specified 24-week long subset analysis in 50 patients aged ≥18 years showed statistically significant improvements in lung function apart from other key secondary endpoints.

Vertex Pharma will file the marketing application for the R117H mutation in the third quarter of 2014 in Europe. Last week, Kalydeco received a positive opinion from the European Committee for Medicinal Products for Human Use (CHMP) for CF in patients aged ≥6 years, who suffer from one of eight non-G551D gating mutations in the CFTR gene. A response in the EU regarding final approval should be out in the September-October timeframe.

Kalydeco is already approved in the U.S. for the treatment of CF in patients aged ≥6 years, suffering from one of nine mutations including G551D, G178R, S549N, S549R, G551S, G1244E, S1251N, S1255P or G1349D. In Europe, Kalydeco is approved for CF in patients (aged ≥6 years) suffering from at least one type of the G551D mutation.

Our Take

We are positive on Vertex Pharma’s label expansion efforts for Kalydeco. In 2013, Kalydeco sales were $371.3 million, up 116.4% y/y. Kalydeco’s approval in the U.S. for the R117H mutation will provide access to nearly 300 eligible patients.

Vertex Pharma carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the health care sector include Actelion Ltd. (ALIOF), Biogen Idec Inc. (BIIB) and ANI Pharmaceuticals, Inc. (ANIP). All these stocks hold a Zacks Rank #1 (Strong Buy).

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