The CHMP — or European version of the FDA — recommended approval of Orgovyx (relugolix, 120 mg) for the treatment of adult patients with advanced hormone-sensitive prostate cancer.
The European Commission (EC) will review the CHMP recommendation, and a final decision on the Marketing Authorization Application is expected to be available in approximately two months (~end of May). The decision will be applicable to all 27 European Union member states plus Iceland, Norway, and Liechtenstein.
With a strong launch in the U.S. (and an on-time approval), the odds are high that Orgovyx is going to be approved by the timeline listed above. Therefore, we believe MYOV is also getting closer to announcing a marketing partner for the drug in the EU. The company has repeatedly stated that it expects to form a deal by the time the drug will be launched.
With the favorable CHMP decision above representing a strong de-risking event for regulatory approval by the end of May, MYOV should announce a deal shortly. As a reminder, previous MYOV marketing deals have all been strategically and financial sound.
We believe the life cycle for Orgovyx is just starting. As of Q4:21, Orgovyx is showing significant growth, with a 40% Q/Q increase. The first full year of sales reached $57 million with positive momentum (already selling at a $100 million annual run rate) despite COVID limitations.
In our view, the drug will begin to annualize at a $200 million run rate by the end of 2022. Orgovyx’s oral dosing profile (once-daily) is highly competitive in the prostate cancer GnRH market, and its market share is just in the low-single-digit range. There is a lot more to go.
MYOV offers important characteristics of a winner — positive new drug launches with competitive advantages in blockbuster markets, a strong balance sheet with no need for additional financing, multiple key catalysts during the year and increasing takeover potential. MYOV is a buy under $30.