Amgen (AMGN) recently presented new long-term data on Prolia (denosumab). Results from a phase II study extension showed that postmenopausal women with low bone mass or osteoporosis undergoing treatment with Prolia for up to eight years experienced a continued increase in bone mineral density (BMD) and a persistent reduction in markers of bone turnover.
These results were presented at the annual meeting of the American Society for Bone and Mineral Research (ASBMR).
Amgen reported that BMD at the lumbar spine and total hip increased on average by 16.8% and 6.9% compared to baseline, respectively. The overall adverse event profile was found to be consistent with previously reported events.
Prolia/Xgeva Could be a Blockbuster
Amgen received a major boost in 2010 when it gained approval for Prolia/Xgeva (denosumab). While Prolia gained approval in the EU for the treatment of osteoporosis in postmenopausal women at increased risk of fractures and the treatment of bone loss associated with hormone ablation in men with prostate cancer at increased risk of fractures, the US Food and Drug Administration (FDA) approved the product for the treatment of osteoporosis in postmenopausal women at increased risk of fractures or patients who have failed or are intolerant to other osteoporosis treatments.
Based on encouraging phase III results, we believe Prolia has the potential to capture a major share of the osteoporosis market, which represents a huge commercial opportunity.
Denosumab is also marketed under the trade name Xgeva. Xgeva is approved in the US (November 2010) and European Union (July 2011) for the prevention of skeletal-related events (SRE) in patients with bone metastases from solid tumors.
The clinical results on Prolia/Xgeva so far are positive for the company, and reinforce our belief that the drug could be a blockbuster.
Amgen continues to pursue additional indications for denosumab. Amgen is currently looking to get Xgeva approved in the US for the reduction of the risk of developing bone metastases in men with castrate-resistant prostate cancer.
Amgen has a collaboration agreement with GlaxoSmithKline (GSK) whereby both companies will share commercialization of Prolia for osteoporosis indications in Europe, Australia, New Zealand and Mexico. Glaxo also has the right to commercialize denosumab for all indications in countries, excluding Japan, where Amgen does not have a commercial presence, including countries like China, Brazil, India, Taiwan and South Korea.
Neutral on Amgen
We currently have a Neutral recommendation on Amgen, which is supported by a Zacks #3 Rank (short-term “Hold” rating). Amgen has a lot riding on the successful commercialization of Prolia/ Xgeva.
We are bullish on Prolia/Xgeva, but any hiccup, either with respect to delays in gaining approval for additional indications, a miss in any of the ongoing phase III programs, delays in the reimbursement coverage process or safety concerns post-launch, will weigh heavily on the shares. We expect investor focus to remain on the successful launch and commercialization of Prolia/Xgeva.
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