Pharmaceutical drug investors should watch in 2019

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  • Investors should keep an eye out for 12 key new drugs in 2019, according to Jefferies analyst Michael Yee.
  • The drugs range from a gene therapy that could be a game-changer for a rare disease, to a CBD product for rare childhood epilepsy and a fish-based drug that could improve heart health.
  • But new drug launches can be a hectic time for companies, so buying shares in these drug makers may not make sense, Yee said.

New year, launch of new drugs.

In 2019, there are 12 drugs investors should watch out for, according to Jefferies analyst Michael Yee. All have been approved or may soon be.

They include gene therapy that spurred a $ 9 billion acquisition, a CBD drug for rare types of childhood epilepsy, and a drug that may be the first specifically approved for postpartum.


depression

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But despite all the activity, Yee urged caution when buying shares in these biotech companies.

His key point: Nothing increases a biotech’s stockpile like a new drug approval – but what happens after that, when companies actually have to sell that drug, is often a mixed bag.

Few small and mid-sized biotech companies have enjoyed unequivocal strong launches in the past year, except for drugmaker Neurocrine Biosciences, Yee said. Meanwhile, the landscape for drugmakers heading into 2019 remains delicate.

“Given the harsh environment of half-empty glass, we believe the hurdle seems even higher for companies to deliver in 2019,” Yee said.

Here are Yee’s picks for next year’s key new drugs:

1. An eczema medication that turns into asthma

Already sold for inflammatory skin eczema, Regeneron’s Dupixent has just been approved as a maintenance medication for moderate to severe cases.


asthma

in mid-October. The 2019 launch will be significant, Yee said.

The link between eczema and asthma may not seem obvious, but both are conditions where inflammation plays, or is believed to play, a role. Dupixent is also being tested in many other inflammation-related diseases, including herbal and peanut allergies, with plans to study it in chronic obstructive pulmonary disease as well.

See more : Treatment for the most common food allergy could be available next year, and a biotech has just taken the lead in the race for the $ 3 billion market

2. A drug against rare diseases of long duration

Alexion’s hit drug Soliris hits the market for ultra-rare blood disease Paroxysmal nocturnal hemoglobinuria (PNH) for 11 years. Also approved for other conditions, Soliris is a key product for Alexion, having achieved nearly 90% of 2017 biotechnology sales.

So it is perhaps not surprising that the company is preparing for new competition.

The company’s new product, Ultomiris, is intended to be a next-generation version of the drug. Ultomiris extends the time to treat patients from every two weeks to every eight weeks; it also conveniently provides new patent protections for biotechnology.

Alexion got Ultomiris approved Last week, and his plans to switch patients “will matter a lot,” Yee said.

3. The first cannabis-derived drug in the United States

gw pharma medical marijuana grow house

GW Pharmaceuticals Epidiolex is the first cannabis-derived drug in the United States.

GW Pharmaceutical


The best-known compound in cannabis is THC, but another non-psychoactive component, CBD, powers the drug Epidiolex, the first cannabis-derived drug in the United States.

The prescription drug, manufactured by GW Pharmaceuticals, was approved over the summer for two rare childhood seizure disorders and was just launched on November 1.

Read more: Marijuana-derived drug triggered first federal cannabis change in half a century, and experts predict avalanche effect

4. Two rare disease drugs in a space that once had no drugs

When Alnylam’s Onpattro was approved in August, it became the first American treatment for ATTR amyloidosis, a rare and progressive disease.

Now there are two drugs for the disease: Onpattro and Ionis / Akcea’s Tegsedi, which was approved by the FDA in October. Although distinct, the two are intended for the nerve damage and pain that accompanies ATTR amyloidosis.

ATTR amyloidosis is known to be difficult to diagnose, and patients didn’t have many options until recently, so finding patients will be the next challenge for biotech companies.

5. A drug that could be the first for postpartum depression

Of the nearly 4 million births that occur each year in the United States, nearly 15% of these new mothers are affected by prolonged postpartum depression.

Treatment options include antidepressants and counseling, but there may soon be another option: Zulresso from Sage Therapeutics biotech.

If approved, Zulresso would be the first drug approved specifically for postpartum depression. Zulresso is under review by U.S. drug regulatory authorities and a decision is expected by March 19, 2019.

Read more: Pharmaceutical company CEO says new depression drug could have lasting effects after short treatment, like antibiotics – here’s what experts think

6. A fish oil drug with possible heart health benefits

whole fish oil 30

Amarin Pharmaceuticals Vascepa is derived from fish.

Shutterstock


A common claim about fish oil supplements is that they are good for your heart, but there is no evidence to back it up.

So imagine the surprise when Amarin Pharmaceuticals’ Vascepa, which is derived from fish oil, showed promise in reducing cardiovascular risk in a large, multi-year clinical trial.

Other data will be of interest to investors, but there is “potential for mergers and acquisitions anyway,” Yee said.

7. An antidote for potentially fatal bleeding

Medicines called blood thinners are used to treat conditions such as stroke and pulmonary embolism, a type of blockage in the arteries. One particular type, factor Xa inhibitors, has become increasingly popular, but it has a major complication: bleeding.

Andexxa from Portola Pharmaceuticals, approved in the United States in May, is used to reverse anticoagulation in cases where patients experience life-threatening or uncontrolled bleeding. The product has since hit the market and generated nearly $ 8 million in sales in its first full quarter.

8. A drug for patients with aggressive breast cancer

Triple negative breast cancer is an aggressive form of the disease that is faster to recur and spread. Immunomedics IMMU-132 is for patients who have not already responded to two or more other drugs for the disease. An approval decision in the United States is expected by the end of January, and if the drug is approved, it “will get a lot of attention,” according to Yee.

9. The launch of a drug against Parkinson’s disease raises existential questions for a biotech

Medicines for Parkinson’s disease can do a lot of good for patients, but as the disease progresses, they don’t always work optimally. Acorda Therapeutics’ Inbrija was approved by the FDA last week for intermittent treatment of these “off” episodes and is expected to be available by the first quarter of next year.

The approval decision, which came early, also draws new attention to what will happen to the company – whether it will work to sell Inbrija or sell itself instead. In particular, drugs against Parkinson’s disease are considered “of strategic value,” said Stifel analyst Paul Matteis after approval at the end of December.

10. Multiple myeloma drug with FDA decision expected by April

Biotech Karyopharm Therapeutics could get an FDA approval decision for its multiple myeloma drug Selinexor by April 6, 2019.

11. The gene therapy behind a $ 9 billion acquisition that could threaten another biotechnology

Vas Narasimhan, CEO of Novartis

Novartis CEO Vas Narasimhan has made a major bet on gene therapy with a nearly $ 9 billion acquisition of biotech AveXis.

Reuters


When Swiss drug giant Novartis acquired biotech AveXis for nearly $ 9 billion, the drug company was clear on its intentions.

AveXis’ flagship product, AVXS-101, could be the “very first single gene replacement therapy for spinal muscular atrophy (SMA), a disease that results in premature death or permanent disability with considerable health costs. ”Novartis said in April.

Gene therapy, now called Zolgensma, could also pose a major competitive threat for Biogen’s crucial spinal muscular atrophy treatment, Spinraza.

The FDA has agreed to look into Novartis Zolgensma request, and a decision is expected in May.

12. An ovarian cancer drug from Shanghai-based biotechnology

Shanghai-based biopharmaceutical company Zai Lab Limited makes its first launch for ovarian cancer drug Zejula in Hong Kong. Zejula is also in front of China’s National Medicines Administration, where a much larger patient population could be on hand.

These could prove to be “a key reading for Asian biotechnology,” said Yee, who has recently attracted interest from US investment, but has also been hit by broader market conditions.


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