Shire plc (SHPGY) recently announced that it has withdrawn its US marketing application for Replagal. Shire had submitted the Biologics License Application (BLA) for Replagal with the US Food and Drug Administration (FDA) in November 2011 and was hoping for a speedy approval.
However, after discussions with the FDA, the company realized that an outright approval was not coming through and the FDA would ask for additional controlled trials. Additional trials would increase the expenses and cause a delay in the approval process. Taking all these factors into account, the company decided in favor of withdrawing the application.
Replagal is already approved in the EU for the long-term treatment of patients with a confirmed diagnosis of Fabry disease
Our Take
Replagal generated revenues of $475.2 million in 2011 and enjoys a worldwide market share of more than 70%. Approximately 20% of treated patients in the US are already receiving Replagal, free of cost, through treatment access programs.
Replagal benefited from switches from Sanofi‘s (SNY) Fabrazyme. In March 2011, Shire presented data suggesting that it was safe for patients suffering from Fabry disease to switch to Replagal from Sanofi’s Fabrazyme.
We do not expect the withdrawal of the BLA to have any impact on Replagal’s position outside the US.
Our Recommendation
We currently have a Neutral recommendation on Shire. The stock carries a Zacks #2 Rank (Buy rating) in the short run.
Shire’s recent collaborations and acquisitions (including Movetis and Advanced BioHealing Inc.) have added immense potential to its pipeline. With several of its products already facing or likely to face generic competition, the company’s pipeline needs to deliver.
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