The U.S. Food and Drug Administration is scheduled to make decisions on five therapies in the second quarter, and the one that could make the biggest impact on the company and its shares belongs to Intercept Pharmaceuticals Inc. (ICPT, Financial).
The New York-based biotech could certainly use a boost. At just over $65, the stock is off about 50% from its 52-week high. TipRanks reported that the 13 analysts following Intercept rated it a strong buy with a target price of $151, but those estimates appear to be pre-coronavirus so investors should view them skeptically.
Intercept is hoping the FDA greenlights its drug obeticholic acid to treat a fatty liver disease call nonalcoholic steatohepatitis, or NASH for short.
NASH can be effectively treated with diet and exercise if it’s caught at an early stage. If not stopped, then it can lead to liver cirrhosis, which requires a transplant. Data on the size and severity of the NASH population is fragmented, but it's estimated that millions of Americans have NASH. According to an analysis by Report Ocean, the global NASH market had sales of about $1.2 billion in 2017. That figure is projected to reach nearly $22 billion by 2025, growing at a compound annual rate of nearly 60% from 2021 to 2025.
Other companies with NASH candidates include Genfit (GNFT, Financial) and Madrigal Pharmaceuticals (MDGL, Financial). So far, however, obeticholic acid is the only drug to show efficacy in a late-stage study.
Another company hoping to get FDA approval is Neurocrine Biosciences Inc. (NBIX, Financial), which calls San Diego home. The company should know by late April whether its drug opicapone is approved. If so, it would have only a limited market because the medication would have to be used with others to treat only certain patients with Parkinson’s disease.
On the other hand, opicapone would give Neurocrine something other than big-seller Ingrezza, a drug for treating involuntary movements caused by taking psychiatric medications. Since being approved in 2017, Ingrezza sales have grown rapidly and are forecast to reach $1 billion this year.
However, the cononavirus could cause that estimate to fall short. That’s because the company’s sales force is now working remotely, eliminating the face-to-face contact with physicians that has been a key factor in generating prescriptions.
Neurocrine currently trades at just over $91, about $25 short of its 52-week high achieved last November.
Other pharma companies hoping for good news include:
- Bristol-Myers Squibb (BMY, Financial) is scheduled to hear on May 15 whether the FDA approves use of a tandem of its drugs, Opdivo plus Yervoy, to treat lung cancer. Then the question becomes whether the combination therapy can compete with treatments from Merck & Co. (MRK, Financial) and Roche (RHHBY, Financial).
- Roche and PTC Therapeutics (PTCT, Financial), for their therapy for spinal muscular atrophy, risdiplam. If approved, the treatment would become the third medication on the market to be used against the disease, joining Biogen's (BIIB) Spinraza and Novartis' (NVS, Financial) Zolgensma. The decision is expected by May 24. Risdiplam appears to have one big advantage over its competitors: it can be taken orally, while the other two require an office visit to have the medication infused.
- Novartis expects the FDA to rule on its drug ofatumumab for multiple sclerosis in June. The company is seeking to expand the label for the medication, which has been on the market in the U.S. for more than 10 years. If the broader use is granted, ofatumumab will join a crowded field, including Biogen's Tecfidera, Sanofi's (SNY), Gilenya from Novartis and Teva's (TEVA) Copaxone. Johnson & Johnson (JNJ) is expected to join the group, having just filed for approval for its medication pnesimod.
Disclosure: The author holds positions in Bristol-Myers Squibb, Teva and Johnson & Johnson.
Read more here:
- Bellerophon Shares Jump on Covid-19 OK
- Covid-19 Could Benefit Generic Drug Companies
- Pharmaceutical Companies Gain in the Fight Against Covid-19
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