We recently reiterated our Neutral recommendation on
United Therapeutics
(
UTHR
). United Therapeutics is focused on the development and
commercialization of therapeutic products for patients with chronic
and life-threatening diseases.
The company's lead product is Remodulin (treprostinil),
indicated for the treatment of pulmonary arterial hypertension
(PAH) in patients with New York Heart Association (
NYHA
) Class II-IV symptoms. Remodulin is approved for both subcutaneous
(SC) and intravenous (IV) use.
The company received approval for an inhaled version of
treprostinil, which is being marketed under the trade name Tyvaso.
In May 2009, United Therapeutics received US Food and Drug
Administration (FDA) approval to market Adcirca (tadalafil) for the
treatment of PAH. The company licensed certain exclusive rights to
tadalafil from
Eli Lilly
(
LLY
) in November 2008.
We believe United Therapeutics is well-positioned to gain share
in the PAH market. Lead product, Remodulin, continues to look very
strong in both the intravenous and subcutaneous forms. With the
approval of Adcirca and Tyvaso, the company has a varied range of
therapies available for the treatment of PAH. We believe United
Therapeutics' PAH product portfolio will drive top-and bottom-line
growth.
The company is working on strengthening its PAH franchise
further through the FDA approval of an oral version of
treprostinil. United Therapeutics filed for approval of oral
treprostinil in late December 2011 with a response from the FDA
expected by October 27, 2012. However, given the mixed data on the
candidate, our expectations for oral treprostinil gaining approval
in 2012 are low.
We are concerned about the company's dependence on Remodulin for
revenues. Remodulin, which accounted for 57.9% of total sales in
2011, is currently facing a generic challenge from Sandoz,
Novartis'
(
NVS
) generics unit. The company needs to develop products that could
help make up for the loss of revenues in the event of
genericization of Remodulin.
Although United Therapeutics has several candidates in its
pipeline, these products are still in too early stages of
development to get excited about. We were disappointed to hear that
the company has suspended its plans to commence phase III studies
with its most advanced pipeline candidate, beraprost-MR, in
December 2011.
With beraprost-MR failing to meet its primary and secondary
endpoints in a phase II study, United Therapeutics is now working
on designing new trials and dosing regimens for the candidate.
Given the early stage nature of the rest of the pipeline, we do not
see any near-term pipeline catalysts that could drive the
stock.
Given the lack of significant near-term catalysts, we expect the
stock to remain range bound in the coming months and remain Neutral
on the stock. United Therapeutics carries a Zacks #3 Rank
(short-term Hold rating).
LILLY ELI & CO (
LLY
): Free Stock Analysis Report
NOVARTIS AG-ADR (
NVS
): Free Stock Analysis Report
UTD THERAPEUTIC (
UTHR
): Free Stock Analysis Report
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