Amgen Inc. (AMGN) suffered a pipeline setback when its cancer candidate motesanib failed in a phase III study (MONET1; n=1090). The study evaluated motesanib in conjunction with paclitaxel and carboplatin for treating patients suffering from advanced non-squamous non-small cell lung cancer (NSCLC). The candidate is being co-developed with Japan’s Takeda.
Results from the multicenter, randomized, placebo-controlled, double-blind trial revealed that overall survival did not improve in patients in the motesanib arm compared to placebo.
We note that this is the second setback for Amgen regarding the MONET1 study. The study was halted in November 2008 on the recommendation of an independent data monitoring committee. The decision of the committee was based on data which revealed that mortality rates were higher in patients treated with motesanib compared to those in the placebo arm. The study resumed after a 3-month gap and evaluated only non-squamous NSCLC patients.
Our Take & Recommendation
We believe that the current pipeline setback regarding motesanib coupled with the negative recommendation issued by the Committee for Medicinal Products for Human Use for Vectibix plus chemotherapy for treating patients with wild-type KRAS metastatic colorectal cancer are the main reasons behind the Zacks #4 Rank (short-term Sell rating) carried by the company. Amgen has appealed against the negative opinion.
However, we have a Neutral recommendation on the stock in the long-run as we believe that investor focus, going forward, will be more on the successful launch and commercialization of Prolia/Xgeva (denosumab), rather than on the negatives mentioned above. Amgen won approval for the drug in 2010.
Prolia was approved in the European Union for the treatment of osteoporosis in postmenopausal women at increased risk of fractures andthe treatment of bone loss associated with hormone ablation in men with prostate cancer at increased risk of fractures.
The US clearance was for the treatment of osteoporosis in postmenopausal women at increased risk of fractures or patients who have failed or are intolerant to other osteoporosis treatments. Denosumab was approved in the US under the trade name, Xgeva, for the prevention of skeletal-related events in patients with bone metastases from solid tumors.
Amgen has a collaboration agreement with GlaxoSmithKline (GSK) whereby the companies will share commercialization of Prolia for osteoporosis indications in Europe, Australia, New Zealand and Mexico. Glaxo also has the right to commercialize denosumab for all indications in countries, excluding Japan, where Amgen does not have a commercial presence, including countries like China, Brazil, India, Taiwan and South Korea.
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