EU Approval for Bayer/JNJ’s Xarelto

Zacks

Bayer’s (BAYRY) HealthCare segment recently received encouraging news when the European Commission approved its oral anticoagulant Xarelto (rivaroxaban) in combination with standard antiplatelet therapy. The combination is approved for the prevention of atherothrombotic events (myocardial infarction, cardiovascular death or stroke) after an acute coronary syndrome (ACS) in adults having elevated cardiac biomarkers.

Bayer mentioned in its press release that with the approval, Xarelto became the only novel oral anticoagulant to be approved for the prevention of elevated cardiac biomarkers after an ACS event.

The approval does not surprise us as in Mar 2013, the European Committee for Medicinal Products for Human Use (CHMP) gave a positive recommendation on Xarelto’s approval in this combination.

Xarelto’s approval was based on positive results from the phase III ATLAS ACS 2-TIMI 51 study (n>15,500). Results from the study showed that the risk of cardiovascular death, myocardial infarction or stroke in patients after an ACS was lower in patients in the Xarelto arm compared to those who received standard antiplatelet therapy alone.

Xarelto is marketed by Johnson & Johnson (JNJ) in the US and by Bayer outside the US.

We note that Xarelto is already approved for several indications in the US including stroke prevention in nonvalvular atrial fibrillation, deep vein thrombosis (DVT), pulmonary embolism (PE) and reducing the risk of recurrent DVT and PE. In the first quarter of 2013, Xarelto sales increased 269% year over year to €155 million.

We remind investors that earlier in the year, Bayer and Johnson & Johnson received a huge setback from the US Food and Drug Administration (FDA) when it issued a second complete response letter for the supplemental New Drug Application (sNDA) for Xarelto (2.5 mg twice daily) for the reduction of the risk of secondary cardiovascular events in patients suffering from ACS.

Bayer presently carries a Zacks Rank #3 (Hold). Meanwhile, other stocks such as Jazz Pharmaceuticals Public Ltd (JAZZ) and Alexion Pharmaceuticals Inc. (ALXN) currently look more attractive. While Jazz Pharma carries a Zacks Rank #1 (Strong Buy), Alexion carries a Zacks Rank #2 (Buy).

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