) recently suffered a setback in its efforts to expand the label of
its key growth driver, Revlimid. The company withdrew its marketing
application in the EU where it was seeking approval for Revlimid as
a front-line maintenance therapy for treating patients suffering
from multiple myeloma (MM).
Celgene stated that it intends to re-submit the application in the
EU only when it has more data at its disposal to provide the
European Medicines Agency's (EMA) Committee for Medicinal Products
for Human Use (CHMP) with more visibility on Revlimid's risk-reward
profile for the indication.
Celgene also pushed back its plans to seek approval of Revlimid for
the additional indication in the US. The company now intends to
seek approval from the US Food and Drug Administration (FDA) for
the new indication in 2013 instead of the earlier target of 2012,
announced while releasing its first quarter 2012 results. The news
pertaining to the delay in filing marketing applications in the US
and EU had a negative effect on the stock.
Celgene also intends to seek approval of Revlimid as a front-line
maintenance therapy for treating MM patients in other markets such
as Switzerland and Australia. We note that Celgene is already
approved in many countries across the globe in combination with
dexamethasone for treating MM patients who have received at least
one prior therapy.
Revlimid is also available in many countries for treating
transfusion-dependent anemia due to low- or intermediate-1-risk
myelodysplastic syndrome (MDS) associated with a deletion 5q
cytogenetic abnormality (with or without additional cytogenetic
Celgene further stated that the FDA has accepted the new drug
application (NDA) for pomalidomide for treating patients suffering
from relapsed and refractory MM. A final decision from the FDA is
expected by February 10, 2013. Celgene is also seeking European
approval for pomalidomide for the same indication.
We note that the MM market has been in the spotlight of late.
Recently, an advisory panel of the FDA recommended the approval of
) Kyprolis (carfilzomib) for treating patients with relapsed and
refractory MM, who have received at least two prior therapies. A
final decision from the FDA regarding the matter is expected by
July 27, 2012.
2012 View Backed
Apart from providing updates regarding the label expansion efforts
for Revlimid and the approval status of pomalidomide, Celgene
reaffirmed its outlook for 2012, provided while releasing its first
quarter 2012 earnings results. Adjusted earnings (excluding
stock-based compensation expense and other special items) are
projected in the range of $4.70-$4.80 per share. The Zacks
Consensus Estimate is $4.50 per share. Adjusted revenues are
projected in the range of $5.4-$5.6 billion, up 15%. Bulk of the
revenues is expected to come from Revlimid, whose sales are
projected in the range of $3.75 - $3.85 billion.
Celgene expects adjusted earnings of $8.00-$9.00 per share on
adjusted revenues of $8.0-$9.0 billion in 2015.
We currently have a Neutral recommendation on Celgene. The stock
carries a Zacks #3 Rank (Hold rating) in the short run.
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