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J&J's Invokana Approved in the US

Zacks Equity Research

Johnson & Johnson's (JNJ) Janssen Pharmaceuticals, Inc. recently gained US Food and Drug Administration (:FDA) approval for its oral, once-daily, type II diabetes treatment, Invokana.

Invokana’s approval was largely expected as the FDA’s Endocrinologic and Metabolic Drugs Advisory Committee had voted 10 - 5 in favor of its approval earlier this year.

We note that the FDA has asked Johnson & Johnson to conduct five post-marketing studies with Invokana. These include a cardiovascular outcomes trial; an enhanced pharmacovigilance program for monitoring malignancies, serious cases of pancreatitis, severe hypersensitivity reactions, photosensitivity reactions, liver abnormalities, and adverse pregnancy outcomes; a bone safety study; and two pediatric studies under the Pediatric Research Equity Act (PREA). The pediatric studies will include a pharmacokinetic and pharmacodynamic study and a safety and efficacy study.

Invokana’s approval is a major positive for Johnson & Johnson. Invokana is the first in a new class of drugs called sodium glucose co-transporter 2 (SGLT2) inhibitors to gain approval in the US. Study results have shown that Invokana improves glycemic control while reducing body weight and systolic blood pressure.

Other SGLT2 inhibitors include Eli Lilly’s (LLY) empagliflozin (new drug application filed in the US and under review in the EU) and Bristol-Myers Squibb (BMY) and AstraZeneca’s (AZN) Forxiga (approved in the EU).

With Invokana being the first SLGT2 inhibitor to launch in the US market, we expect the product to capture a major share of the market.

Johnson & Johnson currently carries a Zacks Rank #4 (Sell). Currently, Eli Lilly looks well-positioned with a Zacks Rank #2 (Buy).

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