Forest Laboratories, Inc.
) and partner Gedeon Richter Plc. suffered a regulatory setback
with the FDA issuing a complete response letter (CRL) for their
schizophrenia and bipolar mania candidate, cariprazine.
While the FDA agreed that cariprazine was effective in the
treatment of schizophrenia and mania associated with bipolar
disorder, the agency said that more information will be needed
for approval. Importantly, the agency has asked for additional
Forest Labs and Gedeon Richter intend to meet with the FDA
shortly to determine the path forward.
Forest Labs has been looking to replace revenues lost to
generic competition by launching new products. While Lexapro
started facing generics in Mar 2012, Namenda is slated to face
generic competition from early 2015 putting $1+ billion of
revenues at risk.
In such a scenario, the cariprazine CRL is disappointing. With
the FDA asking for additional trial data, Forest Labs may be
required to conduct an additional study which could push out the
product approval and launch by anything ranging from a few months
to more than a year. This would mean additional costs as well. At
present, we have low visibility on the exact requirement and
await an update on the same.
Forest Labs currently carries a Zacks Rank #2 (Buy). We
believe the company will continue to pursue in-licensing deals
and acquisitions to grow its pipeline.
Other stocks worth considering include
Jazz Pharmaceuticals Public Limited Company
BioSpecifics Technologies Corp.
). All three carry a Zacks Rank #1 (Strong Buy).
BIOSPECIFICS TE (BSTC): Get Free Report
FOREST LABS A (FRX): Free Stock Analysis
JAZZ PHARMACEUT (JAZZ): Free Stock Analysis
SHIRE PLC-ADR (SHPG): Free Stock Analysis
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