3 Drug Stocks Awaiting FDA Approval

12/13/2011 9:00 am EST

Focus: STOCKS

These three biotech companies are expecting decisions from the Food & Drug Administration (FDA) very soon and hope that approval of their new drugs could be the catalyst to spur their stocks sharply higher.

Last Tuesday, the Food and Drug Administration (FDA) approved Regeneron Pharmaceuticals’ (REGN) drug Eylea to treat a common cause of blindness in older patients. Some analysts predict the drug will become a blockbuster, rivaling Roche’s Lucentis, which brought in $1.4 billion in sales last year.

Eylea is a once-every-eight-week injection that treats wet age-related macular degeneration, a leading cause of blindness in patients 60 and older. Roche’s Lucentis is injected twice as often at a cost of $2,000 per injection, while Eylea costs $1,850 per injection.

Capturing Market Share

Currently, 40% of the market is held by Roche’s Lucentis, while 60% of the market is met by Roche’s Avastin. Avastin only costs $50 per injection, but it’s currently under a federal investigation after being linked to eye infections.

Regeneron estimates that 1.5 million people have wet age-related macular degeneration, with 200,000 new cases diagnosed each year. Citigroup analyst Yaron Werber expects the drug to hit peak sales of $1.1 billion in 2021. Werber also expects that less-frequent dosing will allow Eylea to capture 16% of the US market from Lucentis.

Trading and Investing Ideas

FDA approval or rejection often has big consequences for the stocks of biotech firms putting their drugs forward. Although positive results in the trial process can cause an approval to be priced in before it actually occurs, sometimes the FDA can surprise the market with their decision.

For a look at companies slated to hear back from the FDA on their new drugs, we compiled a list of the companies expecting results by the end of the year.

Do you think these companies’ drugs will be approved? If so, has it already been priced in?

Use this list as a starting point for your own analysis.

Antares Pharma Inc. (AIS) focuses on self-injection pharmaceutical products and technologies, and topical, gel-based products. It has a market cap of $271.20 million. [The FDA granted approval for Anturol gel for overactive bladder on December 8 – Editor.]

chart
Click to Enlarge

NEXT: 2 More Companies Awaiting FDA Approval

|pagebreak|

Protalix BioTherapeutics, Inc. (PLX) focuses on the development and commercialization of recombinant therapeutic proteins based on its proprietary ProCellEx protein expression system in the United States. It has a market cap of $520.57 million. By February 1, 2012, the FDA will make a decision on Taliglucerase to treat Gaucher disease.

chart
Click to Enlarge

Corcept Therapeutics Incorporated (CORT) engages in the discovery and development of drugs for the treatment of severe metabolic and psychiatric disorders. It has a market cap of $270.38 million. By February 17, 2012, the FDA will make a decision on Corlux for treating Cushing’s Syndrome. 

chart
Click to Enlarge

By the Staff at Kapitall.com

Related Articles on STOCKS