Novartis (NVS) and Incyte Corporation (INCY) recently presented positive data from two late stage trials (COMFORT-I and COMFORT II) of their pipeline candidate, INC424 (ruxolitinib) for the treatment of myelofibrosis (MF), a life threatening blood cancer. The data were presented at the American Society of Clinical Oncology (ASCO) annual meeting.
Incyte has the rights to develop and commercialize INC424 in the US. Novartis has licensed rights from Incyte for development and potential commercialization in all hematology-oncology indications outside the US.
One of the major characteristics of MF is bone marrow failure and an enlarged spleen (splenomegaly). Data from COMFORT II study, conducted by Novartis, showed that INC424 led to a reduction in the spleen size versus the best available therapy at week 48. Data from the COMFORT-I trial, conducted by Incyte, demonstrated significant spleen size reduction and improvement in debilitating symptoms (including fatigue and pain) versus placebo at week 24 in patients treated with the candidate.
Incyte recently submitted the new drug application (NDA) for INC424 to the US Food and Drug Administration (FDA) based on the data from both the COMFORT-I and COMFORT-II studies. Incyte has requested the FDA to review the application on a priority basis as MF currently has no approved therapy. We note that the US regulatory authority generally reviews those drugs on a priority basis, which offer major advances in treating diseases having no adequate therapy.
Myelofibrosis is a rare blood cancer, for which there are limited treatment options. It is associated with significantly reduced quality of life and shortened survival. INC424 is expected to provide a significant treatment option for the disease.
Novartis is banking on new drug approvals and successful label expansions to overcome the adverse impact of the upcoming patent cliff. Positive pipeline developments like this can bolster the company’s plans.
INC424 is currently undergoing late stage trials, RESPONSE, in patients suffering from advanced polycythemia vera as well as mid stage trials in patients with other hematologic malignancies and solid tumors. The companies plan to initiate additional trials of INC424 in patients with lymphoma and pancreatic cancer in 2011.
Our Recommendation
Currently, we have a Neutral recommendation on Novartis. The recommendation is supported by a Zacks #3 Rank (short-term “Hold” rating). Though pleased with Novartis’ wide range of products and its efforts to diversify further, as is evident by the acquisition of eye-care company Alcon, we prefer to remain on the sidelines due to the imminent patent cliff faced by the company.
Currently, we have a Neutral stance on Incyte in the long run. The company carries a Zacks #3 Rank (Hold rating) in the short run.
INCYTE CORP (INCY): Free Stock Analysis Report
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