Analysts raised revenue projections for Amgen’s denosumab on Wednesday following the release of data from a head-to-head trial, which showed that the RANK Ligand inhibitor met the study’s primary endpoint of non-inferiority to Novartis’ Zometa (zoledronic acid) in delaying serious complications of bone metastases in patients with advanced breast cancer. Company shares gained as much as 16 percent.

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Thomas Weisel analyst Ian Somaiya raised his estimate for potential denosumab sales in 2012 to $2.1 billion from a previous forecast of $1.8 billion, saying that “superior efficacy could enable denosumab to establish a new standard of care.” Eun Yang, of Jefferies & Co., predicted that once it is approved, denosumab would “take significant market share from Zometa in the cancer setting,” with Oppenheim’s Carri Duncan saying that, due to the latest findings, “we anticipate rapid acceptance of this drug by clinicians who will switch patients from Zometa.”

Amgen did not provide detailed safety data from the trial, notably with regard to rates of osteonecrosis of the jaw, saying only that rates were consistent with prior results. However, Thomas Weisel’s Somaiya commented that “though a significant difference in osteonecrosis of the jaw [between denosumab and Zometa] would have been a home run, we believe that superior efficacy will be enough to drive additional (denosumab) front-line use.”

Regarding the potential for the drug to be used in other cancer indications, Jefferies & Co. analysts said “our experts indicate that the first Phase III data in breast cancer would be a good indicator of what would be expected in other cancer settings.”

Source: FirstWord

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Speculation that Novartis may acquire Cubist for $26 per share, or a total of $1.6 billion, drove Cubist’s shares up as much as 19 percent. According to market rumours, a deal could be announced on April 6.

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The companies already have a partnership for Cubist’s antibiotic Cubicin, which is marketed by Novartis in Europe and other regions outside the US. However, ThinkEquity analyst Brian Skorney suspects the purchase may not be ideal for Novartis. He suggested the drugmaker has not made Cubicin a priority, which may explain the product’s weak sales in Europe. In addition, Gregory Wade, an analyst at Wedbush Morgan, noted that the Swiss drugmaker recently purchased Protez Pharmaceuticals, which has a product that could be considered a rival to Cubicin.

By contrast, Jefferies & Co. analyst Eun Yang said revenue for Cubicin gained 45 percent last year to $414.7 million in the US, and “if [Novartis wants] to get their hands on US sales, why not?” Neither drugmaker commented on the speculation.

Source: FirstWord

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A report Tuesday indicated that GlaxoSmithKline may be interested in acquiring Allergan, according to a person familiar with the matter. Allergan shares surged as much as 14 percent on Tuesday on the speculation.

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Analyst Gary Nachman of Leerink Swann commented that the rumours are “totally unconfirmed,” but he added that “if [GlaxoSmithKline] wants to diversify more outside of pharma, then Allergan’s cosmetic consumer business is a way to go.” Nachman noted that the drugmaker “has certainly been mentioned before as a potential acquirer of Allergan. In a lot of ways it could make sense for [GlaxoSmithKline], but my guess is Allergan wouldn’t want to sell for anything below $70 [per share].”

Natixis Bleichroeder’s Corey Davis indicated that Allergan is an attractive target that would fit well with GlaxoSmithKline or sanofi-aventis. Davis explained that “Allergan is not as exposed to price pressures as drug companies are because its aesthetics products [such as Botox] are an all-cash business” that doesn’t depend on reimbursement from insurers or the government.

Analyst Peter Bye of Jefferies & Co. suggested that a bid for Allergan by GlaxoSmithKline would be “a plausible scenario” given the relationship the companies have for some treatments. GlaxoSmithKline’s CEO Andrew Witty also said last week that the drugmaker is interested in “bolt-on” acquisitions. Both GlaxoSmithKline and Allergan declined to comment on the news.

Source: FirstWord

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Genzyme reported that the FDA issued a complete response letter regarding the company’s application for the larger-batch production of Pompe disease drug Myozyme (alglucosidase alfa), which would be marketed as Lumizyme in the US. The company, whose shares had fallen as much as 7 percent when the markets closed on Monday, said the development could delay the drug’s approval by up to six months.

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The drugmaker currently produces Myozyme in 160-litre bioreactors and is seeking clearance to market the product manufactured at the 2000-litre bioreactor scale. However, the FDA determined that the larger-scale production results in a slightly altered drug, which will need to be approved as a separate compound under a different name. Genzyme will be required to finalise an agreement with the FDA regarding the design of a post-approval verification study aimed at demonstrating Lumizyme’s clinical benefit.

Additionally, the company disclosed that it received a warning letter from the US regulator regarding deficiencies observed at its Allston Landing manufacturing facility in September and October of 2008. Specifically, the “issues relate to aspects of microbiological monitoring and controls, production equipment maintenance and certain process controls,” the company said. Genzyme called the warning “unexpected” given that it provided a progress update on February 23 outlining corrective measures that had been taken, or were scheduled to be completed by March 31. Nonetheless, the company expects to be able to supply all the information requested by the FDA within approximately one month, adding that a “satisfactory resolution” regarding the facility is needed in order for the agency to approve Lumizyme.

Assuming a six-month delay, the company now anticipates that revenue from its Pompe disease treatments will range from $370 million to $380 million, down from a previous forecast of $430 million to $440 million. Commenting on the news, Jefferies & Co. analyst Eun Yang remarked that, “assuming no further delay, we view the delay in Lumizyme approval as a minor setback for Genzyme shares as Myozyme/Lumizyme currently account for less than 8 percent of Genzyme’s total revenue.”

Source: FirstWord

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