Vertex Pharmaceuticals' Kalydeco Label Expanded in EU - Analyst Blog

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Updates on the regulatory front are eagerly awaited by investors in the pharma/biotech sector as they impact the share price of the concerned company. Regulatory updates include events like filing of marketing applications, acceptance of these applications for review by the regulatory agencies, reviews by advisory panels and finally, a response from the regulatory agency regarding the approval status.

Late last week, Vertex Pharmaceuticals Inc. 's ( VRTX ) cystic fibrosis (CF) drug, Kalydeco, received approval in the EU for eight additional gating mutations. Kalydeco, which was initially approved for the treatment of CF patients (aged ≥6 years) who have at least one copy of the G551D mutation, can now be used in patients (aged ≥6 years) who have one of eight non-G551D gating mutations (G178R, S549N, S549R, G551S, G1244E, S1251N, S1255P and G1349D) in the cystic fibrosis transmembrane conductance regulator (CFTR) gene.

The European Commission's (EC) decision is not surprising since the Committee for Medicinal Products for Human Use (CHMP) had earlier recommended the approval of Kalydeco in this indication.

We note that Kalydeco gained approval for these additional mutation in Feb 2014 in the U.S. Vertex Pharma is currently seeking FDA approval for Kalydeco for the treatment of CF patients (aged ≥18 years) with the R117H mutation.

Moreover, Vertex Pharma is developing a combination of Kalydeco and lumacaftor for patients aged 12 years and more who are suffering from two types of the F508del mutation. The company intends to file a new drug application for this combination on a rolling basis. Vertex Pharma expects to complete the submission in the fourth quarter of 2014.

Our Take

We are encouraged by Vertex Pharma's continued progress with its CF franchise. The company is going through a transition period given its decision to focus on its CF franchise and drop investment in the hepatitis C virus pipeline. Kalydeco's approval in the EU for the additional gating mutations will provide access to nearly 250 eligible patients.

In the first half of 2014, Kalydeco revenues were $212.6 million. This approval will help the company achieve its targeted Kalydeco revenues of $470 million − $500 million in 2014.

Vertex Pharma carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the health care sector are Actelion ( ALIOF ), Salix Pharmaceuticals Ltd. ( SLXP ) and Endo International plc ( ENDP ). All these stocks hold a Zacks Rank #1 (Strong Buy).


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: CF , EC , CHMP , VRTX , ENDP

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