Hospira Expands Japanese Footprint – Analyst Blog

Recently, Hospira Inc. (HSP) received a boost when the Japanese authorities approved the company’s sedative Precedex IV 200ug (dexmedetomidine hydrochloride) for an additional indication. The approval permits the sedative to be marketed in Japan for an extended period of use (greater than 24 hours). In a bid to expand the presence of the molecule across the globe, Hospira had already launched the drug in Canada and South Korea earlier this year.

Precedex is the first drug in its class to gain approval as a sedative in the intensive care setting. We note that Precedex was approved in Japan in 2004 for sedation of initially intubated and mechanically ventilated patients in the intensive care for use up to 24 hours. However, a long-term administration study was carried out as doctors wanted to use the Hospira product in patients requiring more-than-24-hour sedation.

The positive results from the study, which evaluated the safety and efficacy of the long-term administration of Precedex in the intensive care setting, prompted Japan’s Ministry of Health, Labour and Welfare (MHLW) to approve the sedative for over 24-hour usage. Japan is the first country in the Asia-Pacific region to receive approval for the expanded use of Precedex. The product is already available in more than 30 markets across the globe.

 

The Japanese approval, which expands the label of Precedex, provides an additional option for sedation management in the intensive care setting and opens up new possibilities in the field of sedation/pain management. Moreover, the approval for the long-term use of Precedex provides a further boost to Hospira’s Specialty Injectable Pharmaceuticals segment which is the primary growth driver at Hospira. This segment includes generic injectables (including biogenerics) as well as proprietary specialty injectables.

 

Hospira currently has a Zacks #3 Rank, which translates into a short-term Hold rating. We are also Neutral on the stock in the long term. Our Neutral stance indicates that the stock is expected to perform in line with the US equity market over the next 6+ months. We advise investors to retain the stock over the time period.