Pipeline and regulatory updates are highly awaited events in the pharma/biotech sector as they play an important role in deciding whether or not to invest in a particular company. These updates provide information on experimental drugs and at times give an insight into the commercial potential of the candidate once it is successfully developed and commercialized.
Earlier this week, Oncolytics Biotech Inc. ONCY announced the submission of an application to the FDA seeking orphan drug designation for its lead pipeline candidate, Reolysin, for the treatment of gastric cancer.
We note that Reolysin already enjoys orphan drug status for primary peritoneal, fallopian tube, ovarian and pancreatic cancer in the U.S. and for primary peritoneal, fallopian tube and ovarian cancer in the EU.
The FDA usually grants orphan drug status to drugs or biologics that are being developed for the treatment of rare diseases/conditions affecting less than 200,000 people in the U.S. at any given time. This designation allows the product to enjoy a period of marketing exclusivity in the U.S., upon approval. Incentives that come with orphan drug status include tax credits as well as waiver of certain administrative fees.
According to the American Cancer Society, approximately 24,590 people in the U.S. are estimated to be diagnosed with gastric cancer this year with 10,720 people expected to die from the disease.
Oncolytics is also seeking orphan drug designation for Reolysin in the U.S. for high-grade gliomas in pediatric patients. Meanwhile, Reolysin is currently in several studies for a wide range of cancers including advanced or metastatic colorectal cancer and advanced or metastatic pancreatic cancer. Being the lead candidate at Oncolytics, we expect investor focus to remain on further updates on Reolysin.
Oncolytics is a Zacks Rank #3 (Hold) stock. Some better-ranked stocks in the health care sector include Cambrex Corporation CBM, Amgen Inc. AMGN and Cytokinetics Inc. CYTK. All three stocks sport a Zacks Rank #1 (Strong Buy).
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