Novartis AGNVS announced that the European Commission has approved Jakavi (ruxolitinib) for the treatment of adult patients suffering from polycythemia vera (PV) who are resistant or intolerant to hydroxyurea.
An approval was already on the cards as the Committee for Medicinal Products for Human Use adopted a positive opinion for Jakavi for the indication in Jan 2015.
We note that Jakavi is already approved in the EU for the treatment of disease-related splenomegaly or symptoms in adult patients with primary myelofibrosis, post-polycythemia vera myelofibrosis or post-essential thrombocythemia myelofibrosis.
We remind investors that Novartis licensed Jakavi from Incyte Corporation INCY for its development and commercialization outside the U.S. Incyte markets the drug under the brand name Jakafi in the U.S. for treatment of patients with intermediate or high-risk myelofibrosis, including primary myelofibrosis, post-polycythemia vera myelofibrosis and post-essential thrombocythemia myelofibrosis. In Dec 2014, the drug was approved for the treatment of patients with PV who showed an inadequate response or were intolerant to hydroxyurea.
We are encouraged by the label expansion of the drug which should further boost sales. Jakavi is a key drug in Novartis' portfolio with sales coming in at $279 million in 2014, up 72% year over year in constant currency.
We remind investors that Novartis undertook a series of actions to reorganize its portfolio in 2014 in order to focus on its core businesses of pharmaceuticals, eye care and generics.
Earlier in the month, Novartis acquired certain oncology products and pipeline compounds from GlaxoSmithKline GSK for $16 billion. In exchange, it sold its non-influenza Vaccines business to Glaxo for $7.1 billion.
We view the reorganization steps as a major positive for the company as it will streamline Novartis' portfolio and focus on its core capabilities, besides contributing immensely to the top line.
Novartis currently carries a Zacks Rank #4 (Sell). Right now, Novo Nordisk NVO looks favorably placed with a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report