Human Genome Sciences Inc.
) recently announced that the US Food and Drug Administration (FDA)
accepted the company's resubmitted Biologics License Application
(BLA) for raxibacumab. A decision from the US regulatory body is
expected in the final quarter of the year (target date: December
Raxibacumab is being developed for the treatment of inhalational
anthrax. The candidate carries fast track and orphan drug
designations for the treatment of anthrax disease.
Human Genome had submitted a BLA to the FDA in May 2009 for
raxibacumab. The application was subsequently accepted and granted
priority review. However, in November 2009, the company received a
complete response letter (CRL) from the US regulatory body asking
for additional data on the candidate.
Human Genome is under contract to deliver doses of raxibacumab
to the US Strategic National Stockpile, which stores huge
quantities of medicine and medical supplies for use in national
emergencies such as flu outbreaks, terrorist attacks or earthquakes
that are lethal enough to deplete local supplies.
In July 2009, the US government exercised its option to purchase
45,000 additional doses of raxibacumab for the Strategic National
Stockpile, to be delivered over a three-year period. This order is
in addition to 20,000 doses delivered to the Stockpile earlier.
The company expects to receive approximately $142 million from
the second award as deliveries are completed. As of March 31, 2012,
Human Genome received $123.5 million. Human Genome is eligible to
receive an incremental $20 million under the contract if the FDA
Meanwhile, the company has been in the news with
) announcing its intention to acquire the former for $13 per share
in cash. Human Genome's board of directors rejected the offer
saying the price was inadequate. Glaxo subsequently went hostile
and launched a tender offer which is now scheduled to expire on
July 20, 2012. As of late June 2012, less than 1% of Human Genome's
shares had been tendered.
We currently have a Neutral recommendation on Human Genome,
which carries a Zacks #3 Rank (Hold rating) in the short run. We
expect investor focus to remain on the Glaxo buyout bid.
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