Genzyme Corp. (GENZ) recently reported progress on the resumption of supply of new lots of Cerezyme from its Allston Landing manufacturing facility, which was temporarily shut down due to contamination issues. The company announced that it has started shipping vials of the newly produced Cerezyme.
The initial lot of the Cerezyme shipment will be used to provide uninterrupted treatment to the most vulnerable patients. By the end of Dec, the company expects to expand supply so as to cover those patients who had experienced interruptions in treatment due to the shortage in supply.
Genzyme believes it will be able to meet worldwide demand for the product in the first quarter of 2010. Genzyme also provided an update on the resumption of supply of Fabrazyme, indicated for Fabry disease, which was also affected by the temporary shutdown of the manufacturing facility. The company is preparing to ship vials of the newly produced Fabrazyme.
However, supply will be low initially due to lower productivity at the manufacturing plant. Genzyme will ship 30% of Fabrazyme demand during the first quarter of 2010 and will start shipping 70-100% of demand in the second quarter. Further details regarding Fabrazyme supply will be available in Feb 2010.
Although we are pleased to hear that Genzyme has resumed supply of Cerezyme, we are concerned about potential competition in the form of Shire plc’s (SHPGY) velaglucerase alfa and Protalix BioTherapeutics Inc.’s (PLX) Uplyso, both of which are currently available under the US Food and Drug Administration’s (FDA) expanded access program.
Competition for Cerezyme will heat up given Protalix’ agreement with pharmaceutical giant, Pfizer, Inc. (PFE) which recently acquired worldwide rights to Ulypso for approximately $115 million ($60 million in an upfront payment and $55 million in regulatory milestones). With Pfizer’s marketing muscle behind it, Ulypso could prove to be a formidable competitor for Cerezyme.
We currently have an Underperform recommendation on Genzyme.
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