2 Orphan Drugmakers With Upcoming Catalysts

Within the next few days, stocks for two orphan drugmakers could either soar or sink. Both Aegerion Pharmaceuticals (NASDAQ: AEGR  ) and Raptor Pharmaceuticals (NASDAQ: RPTP  ) have catalysts coming next week. Here's what could happen.

Successful launch?
For Aegerion, all eyes will be on how well the launch for Juxtapid has gone. The company announces first quarter results on April 30.

Juxtapid received approval from the U.S. Food and Drug Administration last December. The drug is used to lower cholesterol levels in patients with homozygous familial hypercholesterolemia, or HoFH. This disease is a rare and severe lipid disorder that affects around one in a million births. 

Earlier this year, Aegerion laid out its plans to commercialize Juxtapid. The company said that it would focus on identifying patients who are potential candidates for the drug and educating health care providers. Aegerion CEO Marc Beer stated that he expected to "end 2013 with approximately 250-300 patients on therapy on a global basis."

Aegerion faces competition, though. The FDA approved another HoFH drug, Kynamro, in January. The drug was developed by Isis Pharmaceuticals (NASDAQ: ISIS  ) and is marketed by Sanofi (NYSE: SNY  ) .

Kynamro costs $176,000 per year per patient. That's expensive, but not as much as Juxtapid, which costs $235,000 to $295,000 per year.

Investors will be anxious to find out if the higher pricing hurt Aegerion's efforts. That might not be the case if the company's sales team was able to effectively position Juxtapid as the safer alternative. While both drugs can have severe side effects, the FDA advisory committee appeared to view Juxtapid more favorably than Kynamro. The committee voted 13-to-2 for Juxtapid and 9-to-6 for Kynamro.

Yea or nay?
April 30 is an important date for Raptor also. The FDA is scheduled to announced its decision on the company's New Drug Application for Procysbi.

The drug targets the treatment of nephropathic cystinosis, a rare and sometimes fatal metabolic disorder. Cystinosis is currently treated most often with Cystagon, which is marketed by Mylan Pharmaceuticals (NASDAQ: MYL  ) .

Procysbi and Cystagon are two different forms of cysteamine bitartrate. Cystagon is released immediately and must be taken on a strict schedule every six hours -- including during the middle of the night. Procysbi is a delayed release form of cysteamine bitartrate that can be taken twice daily.

Clinical studies found that Procysbi was statistically as effective as Cystagon. While there were some adverse effects, Raptor reported that no serious unexpected issues emerged that were attributable to Procysbi.

Although the FDA pushed back its decision on Procysbi from January to April, that shouldn't raise concerns about the drug's chances. Delays of three months aren't unusual.

Analysts see annual sales for Procysbi of around $150 million. Considering that Raptor's current market cap is less than $360 million on no revenue, a positive decision by the FDA should make the stock take off.

Predictions
We still have to wait a few days to find out what will happen, so whether Aegerion and Raptor shares sink or soar is anyone's guess at this point. It's a tough call on how well Aegerion's efforts on Juxtapid fared during the first quarter. I think things could have gone either way.

While anything can happen with FDA decisions, I expect Raptor will receive good news by next week. A positive FDA announcement would mean even better news to the families with loved ones suffering from nephropathic cystinosis.

While you can certainly make huge gains in biotech and pharmaceuticals, the best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.



Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2384009, ~/Articles/ArticleHandler.aspx, 8/22/2014 2:07:34 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 17,032.86 -6.63 -0.04%
S&P 500 1,991.64 -0.73 -0.04%
NASD 4,544.22 12.12 0.27%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/22/2014 1:52 PM
AEGR $30.10 Down -0.01 -0.03%
Aegerion Pharmaceu… CAPS Rating: **
RPTP $11.01 Down -0.07 -0.63%
Raptor Pharmaceuti… CAPS Rating: **
ISIS $34.48 Up +0.31 +0.91%
Isis Pharmaceutica… CAPS Rating: ****
MYL $48.40 Up +0.65 +1.36%
Mylan Inc. CAPS Rating: ****
SNY $52.66 Down -1.08 -2.01%
Sanofi (ADR) CAPS Rating: *****

Advertisement