Onyx Pharmaceuticals: QuickView

The first reported sales for Kyprolis (carfilzomib) since its U.S. approval have beaten expectations by a wide margin, posing questions about unexpectedly rapid initial adoption of this drug. Onyx claims Kyprolis has already achieved a 10% patient share in third-line multiple myeloma (10-15,000 people), but makes no comment about anecdotal reports of off-label in earlier stages of the disease.

Kyprolis Impresses Early
Onyx’s Q3 results showed $18.6m of Kyprolis sales, blowing through consensus forecasts of $7.4m. We believe that high initial sales may have been flattered by a large body of patients who had been waiting for approval, although Onyx contends that demand in September did reflect normal practice trends. Kyprolis received conditional US approval on 20 July based on a Phase IIb study. The FOCUS Phase III study (for which interim results are due in mid-2013, with final data in Q413) is designed to show an OS benefit in third-line MM. The ASPIRE Phase III trial (Revlimid ± Kyprolis) examines second-line use, but interim results are now not expected until Q413.

Nexavar Sales Peak
Meanwhle, Nexavar (sorafenib) sales were flat in Q3 at $208.2m. Sales in HCC (hepatocellular carcinoma) appear to be approaching a peak level, although there is still growth in certain markets (greater China and South Korea); sales in RCC (renal cell carcinoma) have been declining due to competition from other agents. Historically, HCC has accounted for 75% and RCC 25% of the product’s sales.

DECISION time soon
A near-term catalyst for Nexavar is the read-out from the DECISION Phase III trial in thyroid cancer, due in the next few weeks.

Valuation: Upside Remains If M&A Premium Included
Onyx’s EV is $5.6bn if convertible shares and stock options are included. Its EV is underpinned by Nexavar, Kyprolis and royalties on sales from Stivarga (regorafenib). Because of its three approved cancer drugs and an attractive pipeline, Onyx may become an attractive takeover target.

To Read the Entire Report Please Click on the pdf File Below.