Biotech Movers: Johnson & Johnson (NYSE:JNJ) and Pfizer Inc. (NYSE:PFE)

The close of last week brought with it a number of key developments for big names in the biotechnology sector. Here’s a look at some of the companies that moved the most, what was behind the action in each and what we’re looking for going forward from the companies in question.

The two companies in our crosshairs for the session today are Johnson & Johnson (NYSE:JNJ) and Pfizer Inc. (NYSE:PFE).

Let’s kick things off with Johnson & Johnson. This one is rooted in a drug approval in the US. Specifically, the company reported on July 13 that the Food and Drug Administration (FDA) in the US has given a regulatory green light to a drug called guselkumab. Johnson & Johnson has spent the last few years attempting to demonstrate the clinical benefit of the drug in a psoriasis indication and – on the back of its efforts – had some incredibly strong data supportive of such. With this in mind, the approval doesn’t come as a major surprise, but it’s still translating to some strength based on the revenues potential of the drug in question.

Its mechanism of action (MOA) is rooted in an ability to target what’s called the IL-23 subunit alpha as opposed to the IL-12 cytokine. By blocking IL-23, the drug helps to stop the over-excitatory inflammatory processes that cause the condition (which, for those not familiar with psoriasis, comes about on the back of an overproduction of skin cells can cause itching, pain, burning sensation and skin tightness.

The application that the company put forward was supported by data from a range of trials, all phase III, called VOYAGE 1, VOYAGE 2 and NAVIGATE respectively. The first compared the drug to placebo, the second compared it to an already approved drug in this indication (AbbVie Inc (NYSE:ABBV)’s Humira) and the third compared it to one of Johnson & Johnson’s already approved psoriasis assets, Stelara, investigating efficacy when patients switch from the latter to the former.

To put it simply, all three trials hit the ball out of the park.

In VOYAGE 1, more than 70% of patients in the active arm achieved 90% skin clearance, compared to just 2.4% in the control arm. In VOYAGE 2, 46.8% of patients treated with Humira (the control arm, in this instance) achieved at least 90% clearer skin versus 70% for the active, guselkumab arm. Finally, in NAVIGATE, patients that switched (having not achieved clearance with Stelara) showed significantly greater improvements in skin clearance post-switch.

So, what’s next?

There’s a good chance this will become a major asset in the Johnson & Johnson portfolio. The company has pitched it as a potential blockbuster, and subsequent to this US approval, there are potential green lights in both Japan and Europe slated for near term decision days.

Moving on, then, Pfizer.

This one is also a pipeline update but it’s a few steps behind that of Johnson & Johnson. The company submitted a supplemental New Drug Application (sNDA) to the FDA for a drug called Xeljanz, targeting an expansion on the current indication of the treatment of adults with moderately to severely active rheumatoid arthritis in which methotrexate did not work well. It’s a JAK inhibitor that has demonstrated a strong degree of clinical benefit in these sorts of inflammatory conditions, and – as rooted in the data on which the sNDA is based – expectations are pretty good for a regulatory green light going forward.

The latest update, then, relates to this application and – specifically – the company just reported that the FDA has accepted the sNDA for review. This doesn’t really say anything about the drug’s chances of picking up approval, merely that the agency considers the application complete. With that said, it’s a step in the right direction and means that Pfizer won’t have to allocate any fresh resources to the development side of this program, in this indication – at least not ahead of an FDA decision one way or another, that is.

What’s next for this one?

The agency hasn’t published a specific PDUFA for the sNDA, but we can use standard timeframes to extrapolate a best guess period. Generally, these applications take around eight months from acceptance to review. Assuming the same is true here, the drug should be up for approval or decline at some point during mid-March 2018.


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