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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
Let's take a look at four companies -- Keryx Biopharmaceuticals (NASDAQ: KERX ) , Omeros (NASDAQ: OMER ) , Alexion (NASDAQ: ALXN ) , and Johnson & Johnson (NYSE: JNJ ) -- which could all make health care headlines this morning.
Keryx submits an MAA to the EMA for the approval of Zerenex
First and foremost, Keryx Biopharmaceuticals just submitted a marketing authorization application (MAA) to the European Medicines Agency (EMA) for the approval of Zerenex (ferric citrate coordination complex) to treat hyperphosphatemia in patients with chronic kidney disease (CKD), including both dialysis and non-dialysis dependent cases of CKD. The FDA is also reviewing Keryx's new drug application (NDA) for Zerenex, with a scheduled PDUFA goal date of June 7, 2014.
In January, Keryx's Japanese partner, Japan Tobacco/Torii Pharmaceutical, received marketing approval for ferric citrate, branded in the country as Riona, for the treatment of hyperphosphatemia in patients with CKD. If approved in other markets, analysts believe that Zerenex could generate peak sales of $120 million in the U.S. and EU, as well as $11 million in royalties in Japan at a 13% peak royalty rate.
That would provide a huge boost for Keryx, which doesn't have any other marketed products or other pipeline candidates. Investors seem to be fairly optimistic about Zerenex's future, as shares of Keryx have soared more than 100% over the past 12 months.
Omeros announces positive data for OMS721 in treating aHUS
Meanwhile, Omeros just announced positive data for OMS721, its lead human monoclonal antibody for the treatment of complement-mediated thrombotic microangiopathies (TMAs), a rare disorder which causes clots in the body's organs, most commonly in the kidney and the brain.
The new positive data is related to a form of TMA known as atypical hemolytic uremic syndrome (aHUS). OMS721 was found to significantly inhibit complement deposition in an experimental model, which used serum samples from aHUS patients in the acute phase of the disease.
OMS721 had previously been granted an orphan drug designation by the FDA in December, and an IND (investigational new drug) application for a phase 2 program was submitted to the FDA earlier this month.
Omeros investors should remember that OMS721 is not the company's most advanced product. An NDA and MAA have already been submitted for OMS302, a treatment for ophthalmological procedures. Meanwhile, OMS103HP, a treatment for arthroscopy and menisectomy procedures, is advancing through phase 3 trials. If approved, the two drugs could generate combined annual sales of close to $1 billion, according to analysts at Wedbush.
Alexion in good shape after two positive developments regarding Soliris
Speaking of aHUS treatments, Alexion, which manufactures the aHUS and paroxysmal nocturnal hemoglobinuria (PNH) treatment Soliris, just reported two positive developments.
First, the company raised its profit and sales outlook for the year after the French government agreed to raise reimbursement payments for Soliris. Due to the rarity of aHUS and PNH, Soliris is the most expensive drug in the world with a wholesale price of over $400,000 per patient per year. Alexion now expects to earn $4.37 to $4.47 per share for the full year, up from its original forecast of $3.70 to $3.80 per share. Its revenue forecast was raised to $2.15 billion to $2.17 billion, up from a prior forecast of $2.00 billion to $2.02 billion.
Analysts polled by Thomson Reuters had expected Alexion to book a profit of $3.89 per share on sales of $2.03 billion. Although its revised forecast came in shy of top line estimates, this is still good news. Second, Alexion stated that it would receive approximately $88 million in additional sales in the first quarter thanks to reimbursement related to Soliris sales from previous years.
Investors should note that Soliris was also recently granted orphan drug designations for the prevention of delayed graft function (DGF) in the United States and Europe -- which could boost peak sales expectations (which are currently around $1.5 billion for the aHUS and PHN indications) for the drug if approved.
Johnson & Johnson sells its K-Y Jelly business
Last but not least, Johnson & Johnson's McNeil Consumer Healthcare unit just sold its K-Y personal lubricants business to British consumer goods company Reckitt Benckiser for an undisclosed amount. K-Y products are sold in over 50 countries, and generated more than $100 million in sales last year.
Yet $100 million is pocket change for J&J's consumer health care segment, which generated $14.7 billion in sales in fiscal 2013. K-Y Jelly was notably recalled last year in the U.S. to avert regulatory reviews by the FDA, which intended to review the lubricants as medical products. Therefore, selling the business altogether could help J&J bypass the lingering FDA issue completely.
For Reckitt Benckiser, the K-Y purchase will be complement its line of Durex condoms, which controls 22% of the global condom market. The K-Y acquisition is expected to close by the middle of the year.
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