AstraZeneca (AZN) recently announced the availability of its orphan drug vandetanib in the US. Vandetanib is approved for the treatment of non-operable (unresectable) locally advanced or metastatic medullary thyroid cancer (MTC).
US Approval in Early April 2011
AstraZeneca gained US Food and Drug Administration (FDA) approval for the drug on April 6, 2011. The company is yet to assign a trade name to the treatment. Vandetanib’s label includes a boxed warning regarding QT prolongation, Torsades de pointes, and sudden death. Moreover, a Risk Evaluation and Mitigation Strategy (REMS) is required for the drug.
Vandetanib’s approval was based on encouraging phase III data which showed that treatment with vandetanib resulted in a 65% reduction in the rate of disease progression compared to placebo.
In addition to achieving the primary endpoint of progression-free survival, vandetanib also showed improvement compared to placebo in the secondary endpoints, which were objective response rate and disease control rate.
The American Cancer Society estimates that more than 44,000 new cases of thyroid cancer were diagnosed in 2010 in the US. Medullary tumors account for 4% of all thyroid cancers.
Neutral on AstraZeneca
We currently have a 'Neutral' recommendation on AstraZeneca, which is supported by a Zacks #3 Rank (short-term “Hold” rating). Although the market for medullary thyroid cancer may not be huge, vandetanib should be able to capture a significant share of the market as no approved treatments are currently available. Vandetanib is currently under regulatory review in the EU and Canada.
Meanwhile, we remain concerned about the generic competition or generic risk being faced by several products in the 2010 to 2013 time frame. AstraZeneca is facing patent challenges from generic companies like Teva (TEVA) and Mylan (MYL) among others for certain products.
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