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Celgene Gets Positive CHMP Nod for Revlimid Label Expansion

Zacks Equity Research

Celgene Corporation CELG announced that the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) has adopted positive opinions for label expansions of IMiD medications — leading oncology drug, Revlimid (lenalidomide) and Imnovid.

The CHMP recommended approval of the triplet regimen of Revlimid as combination therapy with Velcade and dexamethasone (RVd) for the treatment of adult patients with previously untreated multiple myeloma who are not eligible for transplant. The positive opinion was based on data from phase III study, SWOG S0777, which showed statistically significant progression-free survival (PFS) and overall survival (OS) improvements in patients treated with RVd compared to those treated with Revlimid and dexamethasone (Rd).

The committee also recommended approval of Imnovid in combination with Velcade and dexamethasone (PVd) for the treatment of adult patients with multiple myeloma who have received at least one prior treatment regimen, including Revlimid.  The positive opinion for PVd was based on the data from the phase III study, OPTIMISMM, which showed that patients receiving PVd achieved a significantly longer PFS than those in the Vd treatment arm.

We note that the European Commission generally follows the recommendation of the CHMP but is not bound by it. The committee is expected to make its final decision in approximately two months. A potential label expansion of the drugs will further boost sales.

Celgene’s key growth driver, Revlimid, an oral immunomodulatory drug, is currently approved for several indications, including MM, myelodysplastic syndromes (MDS) and mantle cell lymphoma (MCL). Sales of the drug came in at $9.7 billion in 2018, up 18.3% from 2017.

Concurrently, Celgene announced the settlement of its litigation with Alvogen for patents related to Revlimid. Per the settlement agreement, both the parties will file Consent Judgments with the United States District Court for the District of New Jersey that will stop Alvogen from marketing generic version of Revlimid before the expiration of the patents-in-suit.

Celgene has agreed to provide Alvogen with a license to its patents required to manufacture and sell certain volume-limited amounts of generic Revlimid in the United States, beginning on a confidential date (some time after the March 2022 volume-limited license date that Celgene previously provided to Natco).  Alvogen is yet to obtain approval of an Abbreviated New Drug Application for Revlimid.

Celgene’s stock has gained 2.7% in the past six months compared with the industry’s decline of 9.8%.

 

Meanwhile, the current focus is on the company’s impending merger with Bristol-Myers Squibb Company BMY. In January, Bristol-Myers announced that it will acquire Celgene for approximately $74 billion. However, it is being opposed by a few shareholders, believing the deal to be overpriced, which will significantly increase shareholders’ risk.

Bristol-Myers recently announced that independent proxy advisory firms, Institutional Shareholder Services (“ISS”) and Glass Lewis & Co. (“Glass Lewis”) recommend that shareholders should vote in favor of the approval of the impending merger with Celgene Corporation.  The merger is expected to close in the third quarter.

The acquisition announcement prompted quite a few other deals. Another leading biotech, Biogen BIIB announced that it will acquire Nightstar Therapeutics. Swiss pharma giant, Roche RHHBY announced that it will acquire Spark Therapeutics for $5 billion.

Zacks Rank

Celgene currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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