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Evofem Shares Up as Birth Control Gel Succeeds in Phase III

Zacks Equity Research

Shares of clinical-stage biotechnological company Evofem Biosciences, Inc. EVFM soared after the company announced that its late-stage trial AMPOWER on lead candidate Amphora for the prevention of pregnancy was successful.

Amphora is a non-hormonal, on-demand, woman-controlled prescription birth control vaginal gel.

The phase III study assessed the efficacy, safety and subject satisfaction with Amphora in approximately 1,400 healthy women aged 18-35 years at 112 centers. The primary endpoint of the study was the pregnancy rate over seven cycles of use (one cycle = 21-35 days) as assessed by the Kaplan-Meier statistical method. The data from the study showed a cumulative pregnancy rate of 14.0% over seven cycles of use, which corresponds to an efficacy rate of 86%. Consequently, the study met its primary endpoint. The efficacy went up to 98.7% with the cumulative pregnancy rate of 1.3% over seven cycles of use when Amphora was used as directed. 

Evofem is developing two proprietary Multipurpose Vaginal pH Regulator (MVP-R) product candidates for multiple potential indications, including prevention of pregnancy, prevention of sexually transmitted infections (STIs), and reduction of recurrent bacterial vaginosis (BV). The lead MVP-R product candidate is Amphora.

The company plans to submit the New Drug Application to the FDA for Amphora in the second quarter of 2019 and also analyse the data further. Assuming approval, the company will commercialize this first-in-class MVP-R for birth control in January 2020.

The FDA will also review the number of pregnancies and evaluable cycles included in Evofem's calculation of the pregnancy rate using the Kaplan-Meier method.

Meanwhile, data from the study also included an exploratory secondary endpoint of sexual satisfaction. This data will be submitted for presentation at upcoming scientific conferences and for publication in peer-reviewed journals following further analyses.

Evofem shares are down 68.9% in the year so far compared to the industry’s decline of 21.4%.

A potential approval will boost growth prospects of the company. The company earlier suffered a setback when it had submitted an NDA to the FDA for Amphora in 2015. However, the agency had issued a Complete Response Letter (CRL) in April 2016, citing the difference in results between the United States and Russian cohorts.

Amphora is also being evaluated in a phase IIb trial, AMPREVENCE, for the prevention of urogenital transmission of chlamydia and gonorrhea in women. Evofem’s pipeline also includes an MVP-R product candidate for reduction of recurrent BV. The company is currently planning a phase II clinical trial in this indication, based on positive phase I results.

However, the market for drugs/gels indicated for the prevention of pregnancy is crowded. Competition is stiff from the likes of Merck’s MRK NuvaRing, among others. Moreover, the contraception products come with its set of risks. In July 2018, Bayer BAYRY announced that it will discontinue the sales of Essure, a female contraceptive implant, by Dec 31 due to health risks.

Zacks Rank & Key Picks

Evofem currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the healthcare sector is Gilead Sciences, Inc. GILD, which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Gilead’s earnings per share estimates increased from $6.65 to $6.93 for 2018 over the past 60 days. Estimates for 2019 are also up by 19 cents.

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