Recently, Pfizer (PFE) announced that it had received priority review for its breast cancer drug talazoparib. This priority review will allow the drug to gain approval sometime near the end of the year, which is a huge positive. There will be a host of competitors that will not make it an easy market to get into. However, Pfizer hasn’t done all that bad since its acquisition of Medivation which gave it talazoparib. That’s why I believe Pfizer is a buy.
Priority Review On The Way
With the FDA priority review for talazoparib, it will speed up the approval process. The FDA decision for approval is now expected by December of 2018. The reason for the acceptance of the NDA filing and for the priority review designation being given was because of positive results from the EMBRACA trial. This phase 3 study recruited a total of 431 patients with an inherited BRCA mutation and locally advanced or metastatic triple negative breast cancer (TNBC) or hormone receptor-positive (HR+)/HER2-breast cancer. The study met its primary endpoint of progression-free survival (PFS). The trial was set up to test talazoparib versus standard of care chemotherapy. It was noted that patients treated with talazoparib had a median PFS of 8.6 months, compared to only 5.6 months for those treated with chemotherapy. This means that treatment with talazoparib resulted in a 46% reduction in the risk of disease progression. Now, I’m happy to say that I like the results from this study. Why are these results so significant? That’s because this trial tested talazoparib versus investigator’s choice of chemotherapy. That means those patients on the chemo were given whatever chemotherapy their investigator deemed would be most sufficient. Despite the ability investigator’s choice of chemotherapy, talazoparib still performed better in PFS. Another impressive observation was that talazoparib was able to allow a greater proportion of the patients to achieve a partial or complete response rate (objective response rate – ORR) of 62.6%. On the other hand, chemotherapy only saw an ORR of 27.2%. Along with the NDA that was just accepted by the FDA for priority review, the EMA has also already accepted the application for talazoparib.
The biggest issue for Pfizer though is that it will have to go against a host of competitors in the same space. For example, AstraZeneca (AZN) and Merck (MRK) have already received FDA approval for Lynparza to treat BRCA mutated breast cancer back in January of 2018. Both companies are even testing Lynparza in combination with Keytruda as well. Other competitors in this space that have parp inhibitors include Tesaro (TSRO) with Zejula and Clovis Oncology (CLVS) with Rubraca. Zejula and Rubraca are also being tested in combination with checkpoint inhibitors in the BRCA breast cancer space. Even if Pfizer does gain approval, it will not have an easy time generating revenue in this space.
Acquisition Is Still A Win
When Pfizer paid $14 billion many years ago to acquire Medivation, it did so in order to obtain a prostate cancer drug known as Xtandi. However, it also obtained talazoparib out of the deal as well. With FDA priority review on the way for talazoparib this makes the acquisition seem that much better. Competition may exist, but it is highly likely that this will find its niche. The most important thing to consider though is that Xtandi continues to be a winner for Pfizer. Pfizer and Astellas have the rights to co-market Xtandi in the United States. However, Astellas has the authority to market it everywhere outside of the United States. Xtandi alliance revenues were recorded at $590 million in 2017. There is good news though, and that is the potential for a label expansion. Pfizer is awaiting an FDA decision by July, so that the label for Xtandi can be expanded to target non-metastatic castration resistant prostate cancer. This means that Xtandi could treat the earlier stage population of this disease. This should allow Xtandi to generate a lot more in revenue.
Pfizer receiving priority review highlights the FDA’s need to get more drugs approved for similar indications so that prices can go down. This will allow the company to obtain FDA approval for talazoparib before the end of 2018. The risk is that sales will likely start off slow, especially with so many competitors in the same space. In addition, there is no guarantee that the FDA will approve talazoparib. The good news is that Pfizer is still producing a good amount of revenue with Xtandi. The expanded label indication for Xtandi in earlier stage prostate cancer will greatly help it in the long run. That’s why I believe that Pfizer remains a buy.
This article is published by Terry Chrisomalis, who runs the Biotech Analysis Central pharmaceutical investment research service on Seeking Alpha Marketplace. If you like what you read here and would like to subscribe to my Service, I’m currently offering a two-week free trial period for subscribers to take advantage of. My service offers deep dive analysis of many pharmaceutical companies throughout the biotech sector. Come see for yourself if my service is right for you.
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