Shares of Coherus Biosciences (NASDAQ:CHRS) are soaring higher today after the biopharma company disclosed through an SEC filing that it's one step closer to receiving marketing approval in the European Union for its first clinical product.
At the Committee for Medicinal Products for Human Use (CHMP) meeting in June, regulators raised several questions about the company's lead drug candidate, CHS-1701. The biopharma responded days later and has since received a letter stating that the issues raised were satisfactorily addressed. Coherus Biosciences now believes that the application will be considered in the CHMP meeting scheduled for next week.
As of 11:31 a.m. EDT, the stock had settled to a 19.5% gain.
Coherus Biosciences is developing biosimilars, which are "generic" versions of biologic drugs, but are no less difficult to manufacture. Unlike generic versions of small molecule drugs, biosimilars are not exact copies of the original innovator biologic drug. So although they'll be offered to patients at reduced prices, they'll still be relatively expensive. That has many analysts eyeing a lucrative new market opportunity as more and more biologic drugs come off patent.
The company's lead drug candidate is a biosimilar for pegfilgrastim, sold under the brand name Neulasta by Amgen, which helps to bolster the immune system of patients undergoing cancer treatment. The drug posted global sales of $4.5 billion in 2017. While no single biosimilar will match that performance, analysts think the first pegfilgrastim biosimilar approved in June 2018 could garner $554 million in annual sales by 2022. It will be sold under the brand name Fulphila by Mylan.
A Neulasta biosimilar represents a big opportunity, and Coherus Biosciences is now closer to delivering one to patients. However, it's also important to note that CHMP does not have the authority to approve drug candidates, only to make recommendations. The European Medicines Agency (the equivalent of the U.S. Food and Drug Administration) generally follows the committee's recommendation.
That said, Coherus Biosciences states on its website that it expects CHS-1701 to be approved "on or before November 3rd, 2018." Getting the marketing application in front of CHMP is the next step toward reaching that target, but investors will have to wait a bit longer to receive the news they're ultimately after.