AstraZeneca plc (AZN) recently announced the US launch of Brilinta (ticagrelor). The drug was approved by the US Food and Drug Administration (FDA) last month, to reduce the rate of heart attack and cardiovascular (CV) death in adult patients with acute coronary syndrome (ACS).
Following the launch, AstraZeneca plans to work with distribution partners and pharmacy customers to ensure that Brilinta is readily available for use.
The regulatory body’s approval was based on the PLATO study, which compared Brilinta to clopidogrel in 18,624 patients suffering from ACS. The study demonstrated that there was no statistical difference in adverse reactions observed among patients treated with Brilinta, compared to those treated with clopidogrel.
Clopidogrel, which is marketed worldwide by Bristol-Myers Squibb & Co. (BMY) and Sanofi-Aventis (SNY) under the brand name Plavix, is an anti-platelet blood thinner, indicated to reduce the risk of heart attack in patients with atherosclerosis.
We note that the drug is currently approved in 39 countries, including the US, Brazil, Australia, and Canada under the trade name Brilinta and in the European Union (EU) under the trade name Brilique. Further, the drug is presently under regulatory review in an additional 45 countries, including Russia, India and China.
We believe that the launch of Brilinta should boost AstraZeneca’s revenues, which is witnessing a decline owing to generic erosion. The company’s second quarter 2011 revenues slid 2% (at constant exchange rates) year over year to $8.4 billion, owing to intense generic competition and government price interventions. (Read our full coverage on the earnings report at: AZN's EPS Falls Shy, Guides Higher)
Neutral on AstraZeneca
We currently have a Neutral recommendation on AstraZeneca. The stock carries a Zacks #3 Rank (Hold rating) in the short-run. We believe the cost-cutting program will aid earnings in the near term, but will not be enough to compensate for the continued revenue deterioration with several major drugs losing patent protection.
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