) and partner
) recently presented disappointing top-line six-month primary
treatment period data from the first phase III global
registration monotherapy study (011: n=67) of Fabry disease
candidate, migalastat HCl.
The study is evaluating the oral version of the candidate for
treating patients suffering from Fabry disease. The evaluated
patients had genetic mutations identified as amenable to
migalastat in a cell-based assay.
Data from the randomized, double-blind study revealed that that
41% patients in the migalastat arm demonstrated a 50% or greater
reduction in kidney interstitial capillary GL-3 as opposed to 28%
in the placebo arm. The study failed to achieve its primary
endpoint and the difference was not statistically significant.
In July 2012, Glaxo and Amicus expanded their existing agreement
related to the development and commercialization of migalastat
for Fabry disease.
As per the terms of the expanded deal, Glaxo and Amicus will
jointly develop all formulations of migalastat for Fabry disease.
Regarding the commercialization of migalastat, Amicus possess the
rights in the US while Glaxo has the rights to market the drug in
the rest of the world.
Additionally, Glaxo hiked its stake in Amicus to 19.9%. Glaxo
made an investment of $18.6 million and bought 2,949,581 shares
of Amicus at $6.30 per share. We note that as of March 31, 2012,
Glaxo's holding in Amicus was 14.8%, representing an equity
investment of $31 million. We believe that Glaxo's increased
holding in Amicus reflects its confidence in Amicus' pipeline.
We currently have a Neutral recommendation on Glaxo. The stock
carries a Zacks #3 Rank (Hold) in the short run.
Several products in Glaxo's portfolio including Valtrex, Arixtra,
Evoclin, Lamictal, Imitrex, Requip, Combivir and Epivir are
facing declining sales due to intense generic competition. We
expect the company's top line and gross margins to remain under
pressure in the coming quarters. EU pricing pressure will
continue to affect sales as well.
Glaxo is aiming to maximize the potential return from its
pipeline. The company is looking to drive growth through deals
and acquisitions. Further, the company is focusing on increasing
the rights on its partnered products and promising pipeline
candidates, so that it stands to benefit more from their success.
Glaxo's acquisition of Cellzome and Human Genome Sciences,
increasing investment in
) and Amicus and amended agreement between ViiV Healthcare and
Shionogi indicate its efforts to expand the pipeline.
Apart from this, Glaxo continues to progress on its cost-cutting
initiative, which should help reduce the impact of increasing
generic competition over the next few years and boost earnings.
Large-cap pharma stocks currently holding a Zacks #2 Rank include
AMICUS THERAPT (FOLD): Free Stock Analysis
GLAXOSMITHKLINE (GSK): Free Stock Analysis
NOVO-NORDISK AS (NVO): Free Stock Analysis
THERAVANCE INC (THRX): Free Stock Analysis
To read this article on Zacks.com click here.