Pfizer (PFE -1.32%) and its partner OPKO Health (OPK -0.76%) recently submitted additional data to the U.S. Food and Drug Administration (FDA) on their Biologics License Application (BLA) for their drug known as somatrogon, which treats children with growth hormone deficiency (GHD).

Since the FDA now has to review the additional data that was submitted, it pushed back the decision date to January 2022.

With a potential FDA approval just a few months away, let's take a look at the efficacy of somatrogon and its sales potential.

Smiling doctor talks to a young patient beside a parent in an office.

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A breakthrough treatment

Looking to keep up with its competitors in the growth hormone deficiency treatment market and move past its own once-daily GHD drug, Genotropin, Pfizer entered into a worldwide agreement with OPKO Health in 2014. This agreement made OPKO Health responsible for conducting clinical trials for its pediatric GHD drug, somatrogon, while Pfizer was put in charge of commercializing the drug using its expertise and existing relationships within the healthcare community.

GHD is a rare disease in which a patient's pituitary gland isn't producing enough growth hormone, resulting in abnormally short stature. Without treatment, patients may also experience low energy levels, increased heart risk factors, and decreased bone density. 

Until the FDA's recent approval of Ascendis Pharma's (ASND -0.50%) once-weekly GHD treatment known as Skytrofa, the standard of care was once-daily injection treatments such as Genotropin.

While these once-daily treatments are effective in treating GHD, the fact that they must often be administered by healthcare professionals rather than at home poses a major treatment burden on patients. This significant effect on daily life is what often causes patients to discontinue their treatments.

That's where Pfizer's once-weekly GHD treatment called somatrogon could come into play and deliver patient outcomes just as effective as once-daily treatments with far less frequent healthcare facility visits.

The results of Pfizer and OPKO Health's completed phase 3 trials in October 2019 point to somatrogon actually being slightly more effective than the once-daily Genotropin. That's because somatrogon's height velocity (a measure of a patient's increase in height over a fixed period) at 12 months was 10.12 centimeters (cm). In other words, one year after beginning treatment, pediatric patients receiving somatrogon once-weekly grew 10.12 cm. This was a bit more than Genotropin's 9.78 cm height velocity, which demonstrates that somatrogon is just as effective in treating pediatric GHD as Genotropin without as much of a treatment burden.

And since patients only need to receive treatment once a week with somatrogon, they scored more favorably than those taking Genotropin on the Life Interference Questionnaire for Growth Hormone Deficiency (LIQ-GHD). This is a questionnaire that medical providers use to measure the burden of routine treatment from the perspective of a patient and their caregiver. The lower the score, the more likely a patient is to stick with their treatment and achieve a positive long-term outcome.

Patients receiving somatrogon once-weekly scored an average score of 8.63 on the LIQ-GHD after 12 weeks of treatment, which was a significant reduction compared to the average score of 24.13 recorded in those receiving Genotropin once-daily after 12 weeks of treatment. 

Solid sales potential

So, somatrogon is a game-changing treatment for children diagnosed with GHD. But what could that mean for sales of the drug for Pfizer and OPKO Health?

Since somatrogon is a bit less effective compared to Ascendis Pharma's Skytrofa (patients receiving Skytrofa achieved a height velocity of 11.2 cm after 12 months of treatment versus 10.1 cm for somatrogon), somatrogon will likely be the number two player in the child GHD market.

OPKO Health points out that approximately 80% of the $3 billion-plus market for human growth hormone therapy is for pediatric GHD. So, even the second-place weekly treatment should be able to steal market share from existing drugs that are once-daily treatments.

That's exactly why Pfizer's CEO Albert Bourla outlined his expectations last year that somatrogon could bring in $500 million to $1 billion annually for the company. Since the low end of this forecast implies approximately 20% market share in the human growth hormone market, this seems realistic for an industry with only a few major competitors. 

Income investors will love Pfizer

While somatrogon could be a key drug for the pharma stock, Pfizer has a variety of products to lean on for steady revenue and earnings going forward, such as its COVID-19 vaccine known as Comirnaty, breast cancer drug Ibrance, and anti-coagulant drug Eliquis.

Pfizer's reputation of innovation to treat various medical conditions is why many income investors will find the stock to be a fit for their portfolios. With Pfizer forecasting $3.95 to $4.05 in earnings per share (EPS) this year, the stock's 3.6% dividend yield will be well-covered with a payout ratio in the high-30% range.