Bristol-Myers' Label Expansion Of Sprycel Gets CHMP Nod

Bristol-Myers Squibb Company (NYSE:BMY) announced that the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency has given a positive opinion on the label expansion of oncology drug Sprycel.

The CHMP recommended approval of the drug in combination with chemotherapy, to include the treatment of pediatric patients with newly diagnosed Philadelphia chromosome-positive (Ph+) acute lymphoblastic leukemia (ALL). The positive opinion includes the tablet form of Sprycel and the powder for oral suspension formulation, which was first approved by the European Commission (EC) in July 2018, making Sprycel the only tyrosine kinase inhibitor with a formulation developed for administration in pediatric patients and patients who cannot swallow tablets.

The EC will now review the recommendation but is not bound by it.

The CHMP recommendation will now be reviewed by the EC, which has the authority to approve medicines for the European Union (EU).

The company’s supplemental Biologics License Application (sBLA) for the same indication is under review in the United States. The FDA action date is Dec 29, 2018.

We note that Sprycel is already approved in the United States for the treatment of adults with Ph+ chronic myeloid leukemia (CML) in chronic phase (CP). The drug also received the FDA approval for adults with Ph+ ALL who are resistant to or intolerant of prior therapy. The FDA also approved Sprycel’s label expansion to include pediatric patients with Ph+ CML-CP in November 2017 and the European Commission approved the same in July 2018.

Concurrently, Bristol-Myers Squibb, Eisai Co., Ltd. and its U.S.-based precision medicine research & development subsidiary H3 Biomedicine, Inc. announced a multi-year research collaboration. The companies will focus on novel therapeutics generating from H3’s RNA splicing platform and evaluate if these can provide a more powerful response against cancer.

The collaboration will explore modulating RNA splicing to develop potential first-in-class therapies that would direct the immune system to target cancer cells and help more patients experience the benefits of immunotherapy.

Per the terms, H3 and Bristol-Myers will jointly conduct the research, focusing on developing immune therapies using H3’s RNA splicing platform. While the former will be responsible for development and commercialization of selected compounds, the latter is entitled to receive an upfront payment along with development, regulatory and sales milestones, and certain royalties according to sales revenue after launch. On the other hand, Eisai retains an option to co-develop and co-commercialize certain compounds that emerge from the collaborative research effort.

Moreover, Bristol-Myers announced a multi-year joint research study with Boston Medical Center to identify and analyze potential sensitivity and resistance markers in patients treated with standard-of-care checkpoint inhibitors. The study will primarily focus on uncovering mechanisms associated with lack of response to Immuno-Oncology (I-O) therapies.

Approval of new drugs and label expansion of existing drugs bode well for Bristol-Myers. Bristol-Myers’ stock has decreased 13.1% in the year so far, against the industry’s growth of 6.3%.

While its blockbuster drug, Opdivo continues to perform well and the label expansion of the drug will further boost the top line, pricing concerns and stiff competition in the immuno-oncology space are major concerns. In particular, Merck’s (NYSE:MRK) Keytruda and Roche’s (OTC:RHHBY) Tecentriq pose stiff competition.

Hence, the label expansion of other drugs of the company should maintain the top-line momentum.

Another drug of Bristol-Myers, Eliquis is also expected to drive further growth, driven by increases in market share in the novel oral anticoagulant (NOAC) market.

Zacks Rank & Other Key Pick

Bristol-Myers currently carries a Zacks Rank #1 (Strong Buy). Another top-ranked stock from the same space is Gilead Sciences, Inc. (NASDAQ:GILD) , which carries the same rank as Bristol-Myers. You can see the complete list of today’s Zacks #1 Rank stocks here.

Gilead’s earnings per share estimates increased from $6.65 to $6.93 for 2018 over the past 60 days. Estimates for 2019 are also up by 30 cents.

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