Johnson & Johnson (JNJ) recently gained US Food and Drug Administration (FDA) approval for its extended release (ER) version of pain drug, Nucynta. The FDA approved Nucynta ER for the management of moderate to severe chronic pain in adults requiring continuous, round-the-clock opioid analgesic for an extended period of time.
Nucynta ER will be available under a Risk Evaluation and Mitigation Strategy (REMS) which will help convey the risks associated with its use. The REMS will inform users about the possibility of abuse, misuse, overdose and addiction from exposure to Nucynta ER.
Nucynta ER’s approval is good news for Johnson & Johnson, which had previously received a complete response letter for the candidate from the FDA in Oct 2010.
Nucynta ER offers a new treatment option to people suffering from chronic pain. According to information from the Centers for Disease Control and Prevention and the American Pain Foundation, more than 42 million Americans (20 years and above) suffer from chronic pain.
We are pleased with Johnson & Johnson’s progress with its pipeline so far in 2011. Besides Nucynta ER, the company gained approval for products including Zytiga and Xarelto.
Meanwhile, we expect the company to gain European Union (EU) approval for its hepatitis C virus candidate, Incivo (US trade name – Incivek) shortly. Incivek is already available in the US where it gained approval in May 2011. Incivek is marketed by partner Vertex Pharmaceuticals (VRTX) in the US.
Neutral on Johnson & Johnson
We currently have a Neutral recommendation on Johnson & Johnson, which carries a Zacks #3 Rank (short-term Hold rating). Even though we expect the company to continue facing headwinds in the form of EU pricing pressure, manufacturing issues and US healthcare reform, we believe Johnson & Johnson’s diversified business model, lack of cyclicality, and strong financial positionwill continue helping the company pave its way through tough situations.
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