Shire plc (SHPG) hosted its research and development (R&D) Day and provided key updates on its pipeline.
The company announced that it has collaborated with the non-profit drug discovery and development affiliate of the Cystic Fibrosis Foundation, Cystic Fibrosis Foundation Therapeutics Inc., to support its messenger RNA Technology platform for cystic fibrosis.
Shire’s pipeline progress looks interesting at this stage. It announced that its pipeline ophthalmology candidate, SHP607, a protein replacement therapy being developed for the prevention of Retinopathy of Prematurity (ROP), has received Fast Track designation from the FDA.
This designation expedites the development and review of drugs to treat serious diseases.
We note that SHP607 is currently in a phase II study to compare the severity of ROP among treatment-experienced patients compared to an untreated control population matched for gestational age. Data from this study are expected in the second half of 2015.
Meanwhile, Shire expects to file a new drug application for ophthalmology candidate lifitegrast. The candidate is being evaluated for the treatment of signs and symptoms of dry eye disease in the first quarter of 2015. Shire is also conducting a phase III study to evaluate the safety and efficacy study (OPUS-3) for a potential approval in the U.S. and international markets.
The company has also completed enrollment of patients in a phase II registration study on SHP625 in pediatric patients suffering from Alagille Syndrome (ALGS) and expects to report top-line results from this study in the first half of 2015. Shire also has four other phase II/III pediatric studies ongoing in patients suffering from ALGS. It is also conducting a phase II study in pediatric patients with progressive familial intrahepatic cholestasis.
Shire has also completed enrollment in a phase II study among adult patients with primary biliary cirrhosis and plans to report the top-line results in the first half of 2015.
On the other hand, the company submitted its investigational new drug application for SHP626 in patients with non-alcoholic steatohepatitis with the FDA in Nov 2014. Shire now plans to initiate a phase IB multiple-dose study in the first quarter of 2015.
Shire is currently developing attention deficit hyperactivity disorder drug Vyvanse for additional indications such as binge eating disorder. It has received a priority review for its supplemental new drug application on Vyvanse from the FDA. A final decision is expected by Feb 2015.
We remind investors that Shire had repositioned its business in 2013, undertaking a realignment program with strategic focus on rare diseases and greater operational discipline. With an aim to reduce overlap, the company has merged three of its autonomous divisions into a single one to drive growth and innovation.
With AbbVie (ABBV) terminating its acquisition offer in Oct 2014, we expect Shire to focus on its existing drugs and pipeline. The company expects pipeline candidates to contribute approximately $3 billion in product sales by 2020. We believe the company’s efforts to build a leaner organization with better focus on rare diseases should lead to improved margins.
Shire currently carries a Zacks Rank #3 (Hold). Investors interested in the health care sector may consider better-ranked stocks like Valeant Pharmaceuticals (VRX) and Sucampo Pharmaceuticals Inc (SCMP), both carrying a Zacks Rank #1 (Strong Buy).
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