Glaxo (GSK) recently announced that it is initiating a phase III program consisting of two studies, namely COMBI-d and COMBI-v. The studies are aimed at evaluating the safety and efficacy of dabrafenib (2118436, BRaf inhibitor) and trametinib (1120212, MEK inhibitor) combination therapy in patients with BRaf mutation-positive metastatic cutaneous melanoma.

The COMBI-d phase III study will compare the combination of dabrafenib and trametinib with dabrafenib alone. The study will evaluate the combination as a first-line treatment for patients with unresectable (stage IIIC) or metastatic (stage IV) BRaf V600E or V600K mutation-positive cutaneous melanoma. This global study is expected to enroll approximately 340 patients with progression free survival (PFS) as the primary endpoint.

The COMBI-v phase III study will compare the combination of dabrafenib and trametinib with Roche’s (RHHBY) Zelboraf (vemurafenib) alone in patients with unresectable or metastatic BRaf V600E/K mutation-positive cutaneous melanoma.

We note that Zelboraf was approved by the US Food and Drug Administration (FDA) in August 2011 for the treatment of BRaf V600E mutation-positive, inoperable or metastatic melanoma. This global study is expected to enroll approximately 690 patients. Overall survival (OS) will be the primary endpoint of the study.

As stand-alone therapies, both dabrafenib and trametinib are currently in late-stage development. In March 2012, the company reported positive results on dabrafenib from the phase III BREAK-3 study. Glaxo is preparing to file marketing applications for both candidates.

Neutral on Glaxo

We currently have a Neutral recommendation on Glaxo. The stock carries a Zacks #3 Rank (Hold rating) in the short run. A major part of Glaxo’s revenues will be exposed to generic competition as multiple drugs are scheduled to lose exclusivity in the next few years.

We expect the company’s top line as well as gross margins to remain under pressure in the coming quarters. In addition to generic competition, EU pricing pressure will continue to affect sales.

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