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McKesson (MCK) Announces Availability of FDA-Cleared Drug for MF

McKesson Corporation MCK recently announced that its independent specialty pharmacy specializing in oncology and rare disease areas, Biologics by McKesson, was selected by GSK as a specialty pharmacy provider for OJJAARA (momelotinib). OJJAARA is an orally administered drug for the treatment of myelofibrosis (MF) in adults with anemia.

OJJAARA was approved by the FDA on Sep 15, 2023.

The availability of the FDA-approved drug is expected to significantly solidify McKesson’s foothold in the global cancer treatment space and boost its U.S. Pharmaceutical business.

Significance of the Availability

MF is a rare blood cancer that is characterized by constitutional symptoms, splenomegaly and progressive anemia. Per McKesson, MF affects approximately 20,000 patients in the United States, with around 40% of patients already anemic at the time of diagnosis and nearly all patients estimated to develop anemia with time.

McKesson’s management believes that OJJAARA will likely address the significant unmet medical needs of MF patients and provide an additional option for treatment.

Industry Prospects

Per a report by Straits Research, the global oncology cancer drugs market was valued at $148,050.6 million in 2021 and is anticipated to reach $288,636.6 million by 2030 at a CAGR of 7.7%. Factors like the rise in the incidence of various cancer conditions and the growing popularity of advanced therapies (such as biological and targeted drug therapies) are expected to drive the market.

Given the market potential, the recent drug availability is expected to strengthen McKesson’s position in the global oncology care space.

Notable Developments

Last month, McKesson announced that Biologics by McKesson was selected by Daiichi Sankyo, Inc. as a specialty pharmacy provider for VANFLYTA (quizartinib).

The same month, McKesson announced its first-quarter fiscal 2024 results, wherein it recorded robust increases in its overall revenues and adjusted earnings per share. This was primarily driven by growth in the U.S. Pharmaceutical segment, resulting from increased prescription volumes, including higher volumes from retail national account customers and specialty and GLP-1 products.

In June, McKesson announced the launch of its curated private brand of over-the-counter health and wellness products, Foster & Thrive.

Price Performance

Shares of the company have gained 26.8% in the past year compared with the industry’s 19.8% rise and the S&P 500's 17.5% growth.

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Zacks Investment Research

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Zacks Rank & Other Key Picks

Currently, McKesson carries a Zacks Rank #2 (Buy).

A few other top-ranked stocks in the broader medical space are DaVita Inc. DVA, HealthEquity, Inc. HQY and Integer Holdings Corporation ITGR.

DaVita, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 12.7%. DVA’s earnings surpassed estimates in three of the trailing four quarters and missed once, with an average surprise of 21.4%. You can see the complete list of today’s Zacks #1 Rank stocks here.

DaVita has gained 18.1% against the industry’s 1.9% decline over the past year.

HealthEquity, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 23.5%. HQY’s earnings surpassed estimates in all the trailing four quarters, with an average of 13%.

HealthEquity has lost 3.4% compared with the industry’s 6.7% decline over the past year.

Integer Holdings, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 12.1%. ITGR’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 8.4%.

Integer Holdings has gained 29.4% compared with the industry’s 3.4% rise over the past year.

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