Sanofi/Regeneron's Kevzara Gets FDA Approval For Arthritis

Sanofi (PA:SASY) (NYSE:SNY) and partner Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) announced that the FDA has approved their pipeline candidate sarilumab to be marketed under the trade name of Kevzara.

Kevzara has been approved for the treatment of moderately-to-severely active rheumatoid arthritis (RA) in adult patients who have had an inadequate response or intolerance to one or more disease modifying anti rheumatic drugs (DMARDs), such as methotrexate (MTX). We remind investors that Kevzara was approved in Canada in February this year for the same indication while it is under review in the EU.

So far this year, Sanofi’s share price has risen 21.5%, better than an 8.6% increase for the Zacks classified Large-Cap Pharma industry.

We remind investors that in Oct 2016, the companies got a Complete Response Letter (CRL) from the FDA for sarilumab. While the CRL did not raise any issues regarding sarilumab’s efficacy or safety, the agency cited certain deficiencies observed during a routine good manufacturing practice inspection of the Sanofi Le Trait facility in France where sarilumab is filled and finished. Last month, the FDA accepted the resubmission of the Biologics License Application for Kevzara, following the successful inspection of the Le Trait manufacturing site.

The U.S. approval was supported by data from the global SARIL-RA clinical study, conducted in approximately 2,900 adults with moderate-to-severely active RA who had an inadequate response to previous treatment regimens. Kevzara demonstrated statistically significant, clinically-meaningful improvements in combination with conventional DMARDs, including methotrexate in two pivotal phase III studies.

Sanofi projects that Kevzara and five other new drugs – Toujeo (diabetes), Praluent, Dengvaxia vaccine Soliqua and Dupixent/dupilumab – to generate aggregate peak sales of €12 billion - €14 billion by 2025, while up to 18 new products are on track to be launched by 2020.

Dupixent was also recently approved by the FDA for treating atopic dermatitis in March and is now available to adult patients in the U.S. The drug is under review in the EU for the same indication. We are optimistic on the sales prospects of Dupixent, which could prove to be an important growth driver for the company. Soliqua, a once-daily titratable fixed-ratio combination of Lantus and Lyxumia, was launched in the U.S. this year in January and is expected to be launched in Europe later this year.

The list price of Kevzara is $39,000/year for the 200 mg and 150 mg doses, which is at a discount of approximately 30% to that of the two most widely used competitive drugs in a highly crowded space. Pfizer, Inc.’s (NYSE:PFE) Xeljanz is already approved for the treatment of moderate-to-severely active RA in patients who respond inadequately or are intolerant to methotrexate. Other drugs approved for RA include Roche Holding (SIX:ROG) AG’s (OTC:RHHBY) Actemra AbbVie’s Humira and Bristol-Myers’ Orencia.

Sanofi currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.

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