The strong performance has been driven by the solid performance of the company’s lead drug, Jakafi, and encouraging pipeline progress in the year so far.
The growth in Jakafi in the first half of 2019 was driven by consistent uptake in two approved indications — polycythemia vera (“PV”) in patients who have had an inadequate response to or are intolerant to hydroxyurea and intermediate or high-risk myelofibrosis (MF), including primary MF, post-PV MF and post-essential thrombocythemia MF.
Moreover, the FDA approval of the drug for the treatment of steroid-refractory acute graft-versus-host disease (GVHD) in adult and pediatric patients aged 12 years or older in May 2019 has boosted its growth prospects.
Hence, concurrent with the second-quarter results, the company stated that it now expects Jakafi revenues of $1,610-$1,650 million in 2019 (previous guidance: $1,580-$1,650 million).
Meanwhile, Incyte is working on expanding the drug’s label further. The cream formulation of ruxolitinib is currently in phase III development for the treatment of patients with mild to moderate atopic dermatitis (TRuE-AD), with initial results expected in the first half of 2020. It is also being evaluated for the treatment of adolescents and adults with vitiligo (TRuE-V). A potential approval in these indications will propel sales further, given the market potential.
Additionally, two studies evaluating the drug in steroid-refractory acute and steroid-refractory chronic GVHD are ongoing in collaboration with Novartis NVS.
Incyte’s pipeline is highly encouraging and key updates are expected later this year. Apart from ruxolitinib, Incyte is evaluating a promising candidate, itacitinib, as a treatment for patients with newly-diagnosed acute GVHD in a late-stage study. The candidate is also being evaluated as a treatment for patients with newly-diagnosed chronic GVHD in a phase III study, which was initiated in January 2019. A potential approval will further strengthen its GVHD franchise.
Another promising candidate in the pipeline is pemigatinib. The phase III study of pemigatinib for the first-line treatment of patients with FGFR2 translocated cholangiocarcinoma was initiated in June. Incyte is planning to submit a New Drug Application (NDA) seeking approval for the candidate as a second-line treatment for patients with FGFR2 translocated cholangiocarcinoma later this year.
Capmatinib, an oral reversible inhibitor of the MET receptor tyrosine kinase, is being evaluated for the treatment of non-small cell lung cancer (NSCLC). The FDA granted the Breakthrough Therapy designation to capmatinib as a treatment for patients with metastatic NSCLC harboring MET exon-14 skipping mutation, with disease progression on or after platinum-based chemotherapy. Partner Novartis expects to submit an NDA seeking approval of the candidate later this year.
Incyte also earns royalties from partner Eli Lilly LLY on sales of Olumiant (baricitinib).
Though pipeline setbacks and potential competition from Celgene’s CELG Inrebic are concerns, we expect Jakafi and potential new drug approvals to maintain momentum for the company.
Incyte currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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