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Pharma Stock Roundup: Zoetis to Buy Abaxis, NVS Gets FDA Nod for Migraine Drug

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This week AstraZeneca AZN, Novartis NVS and Eli Lilly LLY announced regulatory and pipeline updates on line extensions of their marketed drugs. While AstraZeneca’s asthma drug Fasenra failed to meet the primary endpoint in a late-stage study evaluating it for an expanded indication — chronic obstructive pulmonary disease (“COPD”); Lilly’s migraine candidate galcanezumab met the same in a late-stage study, evaluating it for another indication — prevention of episodic cluster headache.

Novartis’ multiple sclerosis (“MS”) drug Gilenya gained FDA approval for use in adolescents. Its CGRP antibody, Aimovig, also gained FDA approval for prevention of migraine. Zoetis ZTS and Lilly announced acquisition deals.

Recap of the Week’s Most Important Stories

Lilly’s to Buy Another Small Cancer Biotech: Lilly has agreed to buy an early-phase oncology asset, AK-01, from AurKa Pharma to expand its oncology pipeline. Lilly will make an upfront payment of $110 million and acquire all shares of AurKa Pharma. This is Lilly’s second cancer acquisition in less than a week. Last week, Lilly had announced an all-cash deal tobuy immuno-oncology biotech, ARMO Biosciences for $1.6 billion. (Read More: Eli Lilly to Buy AurKa Pharma, Expand Cancer Pipeline)

In another development, its migraine candidate galcanezumab met the primary endpoint in a late-stage study, evaluating it for another indication — prevention of episodic cluster headache. Galcanezumab is already under review in the United States for migraine prevention with a decision expected in the third quarter of the year. However, a separate phase III study evaluating galcanezumab in patients with chronic cluster headache did not meet the primary endpoint. (Read more: Eli Lilly’s Cluster Headache Candidate Succeeds in Phase III)

Zoetis to Buy Abaxis: Zoetis announced a definitive agreement to buy California-based Abaxis, which is leading global provider of veterinary point-of-care diagnostic instruments for approximately $2 billion or $83 per share in cash. The deal is aimed to enhance Zoetis’ presence in the animal health diagnostics market. This diagnostics category is a fast-growing portion of the animal health industry and has grown at a compound annual growth rate of approximately 10% over the last three years. (Read more: Zoetis Inks Deal to Acquire Abaxis for $2 Billion)

Novartis’ Aimovig Gets FDA Nod: Novartis and partner Amgen AMGN gained FDA approval for their CGRP antibody, Aimovig for the prevention of migraine. With the FDA approval, Aimovig is now the first and only FDA-approved treatment for migraine, which works by blocking the calcitonin gene-related peptide receptor (CGRP) that plays a critical role in migraine attacks. Meanwhile, Lilly and Teva Pharmaceutical Industries Ltd. TEVA are also awaiting FDA approval for their CGRP migraine candidates, galcanezumab and fremanezumab this year.

Novartis’ MS drug Gilenya gained FDA approval for the treatment of children and adolescents aged between 10 and 18 with relapsing forms of multiple sclerosis. The approval for this expanded patient population should boost sales of Gilenya. The drug recorded sales of $821 million in the first quarter, representing year-over-year growth rate of 8% on a constant currency basis. (Read More: Novartis Multiple Sclerosis Drug Gets FDA Nod for Adolescents).

AstraZeneca’s Fasenra Fails to Meet Endpoint in Phase III COPD Study: AstraZeneca’s respiratory biologic medicine, Fasenra (benralizumab) failed to meet the primary endpoint in a late-stage study evaluating it for a new indication – severe COPD. Fasenra is already approved in the United States, EU and Japan as an add-on maintenance treatment in patients with severe eosinophilic asthma.

Top-line results from the pivotal phase III GALATHEA study showed that treatment with Fasenra did not result in a statistically-significant reduction of exacerbations compared to placebo in patients with moderate-to-very severe COPD. (Read more: AstraZeneca’s Asthma Drug Fasenra Fails in COPD Study).

AstraZeneca announced weak first-quarter 2018 results, missing the Zacks Consensus Estimate for both earnings and sales due to lower sales of its cholesterol drug, Crestor. It maintained its previously issued outlook for 2018.

Pfizer Biosimilar Retacrit Gets FDA Nod: Pfizer’s PFE Retacrit, which is a biosimilar version of anemia drugs Amgen’s Epogen and J&J’s JNJ Procrit, gained FDA approval for all indications of the reference products, which include treatment of anemia due to chronic kidney disease (CKD). Pfizer already markets the biosimilar in Europe. In May last year, the FDA’s advisory committee had recommended approval of Retacrit. (Read more: Pfizer Gets FDA Nod for Amgen, J&J's Anemia Drug Biosimilar).

FDA Names Drugmakers Which Block Approval of Generics: The FDA issued a list of companies this week that it said were using certain “gaming” tactics to delay generic competition for their marketed drugs. The FDA said that these companies were preventing generic players from obtaining the necessary samples of their branded products, which are required to secure approval of a generic drug.

The inability to secure such samples slows down the approval process. The list included big names like Shire, Novartis, Mylan, AstraZeneca, Teva, BioMarin, Gilead and Bayer among others. The FDA’s decision to publish such a list is part of a broader effort by Congress to encourage approval of low-cost generic drugs.

The NYSE ARCA Pharmaceutical Index rose 1.4% in the last five trading sessions.

Large Cap Pharmaceuticals Industry 5YR % Return


Large Cap Pharmaceuticals Industry 5YR % Return


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

All stocks were in the green last week except J&J, which declined 1.2%. Bristol-Myers rose the most (3.1%).

In the past six months, Glaxo GSK has been the biggest gainer (14.2%) while Bristol Myers declined the most (13.3 %).

(See the last pharma stock roundup here: Pharma Stock Roundup: LLY to Buy Cancer Biotech, J&J, AZN, Roche Announce Updates)

What's Next in the Pharma World?

Watch out for FDA decisions on many pipeline drugs and line extensions of marketed products this month.

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AstraZeneca PLC (AZN) : Free Stock Analysis Report
Pfizer Inc. (PFE) : Free Stock Analysis Report
Eli Lilly and Company (LLY) : Free Stock Analysis Report
Novartis AG (NVS) : Free Stock Analysis Report
Johnson & Johnson (JNJ) : Free Stock Analysis Report
GlaxoSmithKline plc (GSK) : Free Stock Analysis Report
Amgen Inc. (AMGN) : Free Stock Analysis Report
Zoetis Inc. (ZTS) : Free Stock Analysis Report
Teva Pharmaceutical Industries Ltd. (TEVA) : Free Stock Analysis Report
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