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Pharma Stock Roundup: FDA Updates From LLY, GSK, NVS, SNY to Spin-Off API Unit

Kinjel Shah

This week, the FDA accepted regulatory filings from Glaxo GSK and Novartis NVS seeking label expansion of their drugs, Zejula and Arzerra, respectively. The FDA also gave approval to Lilly’s LLY GLP-1 receptor agonist, Trulicity to reduce cardiovascular risk. Sanofi SNY announced plans to spin-off its active pharmaceutical ingredients (API) business into a separate standalone European company. Bayer BAYRY reports its fourth quarter 2019 earnings results.

Recap of the Week’s Most Important Stories:

Lilly Gets FDA Nod to Add Heart Indication to Trulicity Label: The FDA granted approval to include data from the cardiovascular (CV) outcomes study (REWIND) on the label of Lilly’s Trulicity. With the approval, Trulicity can now be prescribed to reduce major adverse cardiovascular events (MACE) in adults with type II diabetes who have established CV disease or multiple CV risk factors. The REWIND study evaluated the effect of Trulicity 1.5 mg compared to placebo, both added to standard of care on CV events in type II diabetes patients. The drug may be able to cater to a much broader patient population with REWIND data now approved to be included on the label.

Meanwhile, the FDA’s Oncologic Drugs Advisory Committee (ODAC) voted 6-5 for approving Lilly’s Cyramza (ramucirumab) in first-line metastatic non-small cell lung cancer (“NSCLC”) with EGFR mutation. The company has filed a supplemental biologics license application (sBLA) seeking approval of Cyramza in combination with Roche’s RHHBY Tarceva (erlotinib) in this indication based on data from the phase III RELAY study. Cyramza was approved for the same patient population in Europe in January.

Glaxo’s Zejula Supplementary Filings Accepted in EU & U.S.: The FDA and the European Medicines Agency (EMA) accepted Glaxo’s supplemental regulatory applications seeking approval of its PARP inhibitor, Zejula as monotherapy for maintenance therapy of women with first-line ovarian cancer who responded to platinum-based chemotherapy regardless of biomarker status. The filings were based on the results of the PRIMA study which demonstrated clinically-meaningful outcomes of Zejula maintenance treatment in the first-line setting regardless of biomarker status. In the United States, the application is being reviewed under the FDA’s Real-Time Oncology Review pilot program.

Zejula, the ovarian cancer drug Glaxo acquired from the Tesaro acquisition, is currently approved as a maintenance treatment for women with recurrent ovarian cancer who responded to platinum-based chemotherapy regardless of biomarker status. It was approved as a treatment for women with advanced ovarian cancer, following three or more chemotherapy regimens in October last year.

The EMA also accepted Glaxo’s regulatory submission seeking approval of their their triple combination once-daily single inhaler Trelegy Ellipta for a new indication -uncontrolled asthma. Trelegy Ellipta is presently approved to treat chronic obstructive pulmonary disease (COPD). A similar application is also under review in the United States and in Japan.

Novartis’ Filings for Ofatumumab Accepted in EU & U.S.: The FDA and EMA also accepted Novartis’ sBLA and marketing authorization application (MAA), respectively seeking approval of subcutaneous ofatumumab, a novel B-cell to treat relapsing forms of multiple sclerosis (RMS). The filings were based on data from the phase III ASCLEPIOS I and II studies. While the FDA is expected to give its decision in June, approval in Europe is expected in the first quarter of 2021.  Ofatumumab is marketed by Novartis for oncology indications as an intravenous infusion under the brand name, Arzerra.

The FDA also accepted Roche’s BLA seeking approval of fixed-dose combination (FDC) of Perjeta and Herceptin administered subcutaneously for the treatment of HER2-positive early breast cancer (eBC). The  subcutaneous formulation of the FDA has been developed to reduce the time spent receiving treatment as it can be  administered under the skin in just eight minutes compared to hours taken to give the intravenous formulations.

Sanofi to Separate its Ingredients Unit Into a New Company: Sanofi announced plans to combine its active pharmaceutical ingredients (API) commercial activities with six of its European API production sites and spin-off the same into an independent European API company. Meanwhile, Sanofi will decide on whether the API company should be listed via an initial public offer (IPO) on Euronext Paris by 2022. In Europe, most of the pharmaceutical companies rely on Asian companies for supply of the APIs used in their drugs. Sanofi believes that the new API company should ensure adequate supply of APIs in Europe.

Bayer’s Q4 Results: Bayer’s core earnings per ADR rose 22.9% in the fourth quarter while sales growth was 3.8% on a reported basis. Among its various segments, Pharmaceuticals segment increased 9.1%, Consumer Health sales were up 0.5% year over year while Crop Science sales declined 0.2%. In 2020, Bayer expects Bayer expects currency-adjusted sales from continuing operations to amount to €44-€45 billion. Core earnings per share are expected to increase between €7.00 and €7.20 on a currency-adjusted basis.

AstraZeneca Divests Rights to Movantik:  AstraZeneca AZN agreed to sublicense the global rights (excluding Europe, Canada and Israel) to its oral constipation drug, Movantik to RedHill Biopharma for an upfront payment of $52.5 million.  AstraZeneca will continue to manufacture and supply Movantik to RedHill for some time. Movantik generated sales of $96 million in 2019 in the United States. Since the past two years, AstraZeneca is regularly divesting several non-core products as it streamlines its portfolio to focus on its core areas of oncology, cardiovascular, renal & metabolism and respiratory. Last year, it sold rights to schizophrenia drugs Seroquel and Seroquel XR to Cheplapharm Arzneimittel GmbH.

The NYSE ARCA Pharmaceutical Index declined 7.3% in the last five trading sessions.

Large Cap Pharmaceuticals Industry 5YR % Return

Here is how the seven major stocks performed in the last five trading sessions.

Last week, all the stocks were in the red with Lilly declining the most (9.0%).

In the past six months, Bristol-Myers has risen the most (23.4%) while Merck declined the most (10.0%).

(See the last pharma stock roundup here: AZN Reports Q4 Results, NVS, PFE Drugs Get EU Approval)

What's Next in the Pharma World?

Watch out for regular pipeline and regulatory updates next week.

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Click to get this free report Sanofi (SNY) : Free Stock Analysis Report AstraZeneca PLC (AZN) : Free Stock Analysis Report Roche Holding AG (RHHBY) : Free Stock Analysis Report Eli Lilly and Company (LLY) : Free Stock Analysis Report GlaxoSmithKline plc (GSK) : Free Stock Analysis Report Novartis AG (NVS) : Free Stock Analysis Report Bayer Aktiengesellschaft (BAYRY) : Free Stock Analysis Report To read this article on Zacks.com click here.