Clovis' Rubraca Gets Nod As Maintenance Therapy In Europe

Clovis Oncology, Inc. (NASDAQ:CLVS) announced that the European Commission (“EC”) has granted approval to a label expansion of its PARP inhibitor, Rubraca (rucaparib), which will expand the drug’s eligible patient population. The drug is now approved as a maintenance treatment in recurrent ovarian cancer patients, irrespective of BRCA-mutation, who have received one prior platinum-based chemotherapy. The company is planning to launch the drug this quarter in the new indication starting with Germany.

This is the second approved indication of Rubraca in Europe. The decision was expected as the CHMP had recommended the approval last month. The FDA approved a similar label expansion of the drug in April 2018.

Investors cheered the European label expansion as shares of Clovis rose 3.9% on Jan 24. The company’s shares have rallied 46.5% in the past three months compared with the industry’s rise of 3.5%.

In Europe, Rubraca was earlier approved for BRCA-mutated, platinum-sensitive and relapsing ovarian cancer in third- or later-line setting.

The approval in second-line maintenance setting and most importantly exclusion of BRCA mutation criteria for patient selection will broaden the patient population significantly. Moreover, this brings the drug on par with other approved PARP inhibitors – AstraZeneca’s (NYSE:AZN) Lynparza and GlaxoSmithKline’s (NYSE:GSK) Zejula – for ovarian cancer in both U.S. and European markets. We remind investors that Glaxo added Zejula to its portfolio with the recently closed acquisition of TESARO Inc. for $5.1 billion.

We believe Clovis is a potential acquisition target as the merger & acquisition space heats up in the United States. The recent approval should add to its appeal as a buyout target.

However, we note that Clovis has struggled to capture market in the maintenance setting market in the United States. Rubraca sales disappointed in the third quarter after surging in the second quarter following U.S. label expansion. The effect of the company’s promotional initiatives and label expansion in Europe remains to be seen.

Moreover, the other two PARP inhibitors belong to big pharma companies with strong cash resources to promote their drugs, which can push Clovis on the back foot.

The PARP inhibitor segment is also getting competitive as several pharma/biotech companies are developing their candidates in multiple indications. In October, Pfizer’s (NYSE:PFE) Talzenna (talazoparib) received approval for treating breast cancer.

Please note that, the approval of Rubraca in maintenance setting by the EC was based on data from the confirmatory phase III study – ARIEL 3 – which showed that Rubraca led to significant improvement in progression-free survival in such patients. The company believes that Rubraca is the only PARP inhibitor to demonstrate tumor shrinkage as well as prolonged progression-free survival in this setting, which may boost its adoption.

Meanwhile, a phase III confirmatory study, ARIEL4 is evaluating Rubraca compared with chemotherapy on patients who have failed two prior lines of therapy. Clovis is also looking to expand Rubraca’s label into additional indications like prostrate, breast and pancreatic cancers among others either as monotherapy or in combination with other agents.

Clovis Oncology, Inc. Price

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Zacks Rank

Clovis currently carries a Zacks Rank #4 (Sell).

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