Biotech Stocks Facing FDA Decision In July 2022

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As we wrap up the first half of the year and step into July, let's take a look at the FDA approval count of novel drugs so far this year.

Sixteen novel drugs have been greenlighted so far this year, down from twenty seven during the same period last year. For the whole of 2021, 50 novel therapeutics secured FDA approval compared to 53 in 2020.

Let's take a look at some of the stocks that await FDA decision in July.

1. Horizon Therapeutics Public Limited Co. (HZNP)

Horizon Therapeutics Public Limited Co. (HZNP) is seeking to expand the label for KRYSTEXXA to include co-treatment with Methotrexate for people living with uncontrolled gout, and a decision is expected on July 7.

KRYSTEXXA, as monotherapy, is currently indicated for the treatment of chronic gout refractory to conventional therapies, also known as uncontrolled gout, in adult patients. The drug was launched in the U.S. in February 2011.

In clinical trials, the combination of KRYSTEXXA with an immunomodulating therapy such as Methotrexate has been shown to reduce the development of antidrug antibodies, which can affect treatment efficacy with biologics.

KRYSTEXXA generated annual net sales of $565.5 million in 2021, a 39% increase over the prior year.

HZNP closed Monday's trading at $85.49, up 0.42%.

2. BeiGene Ltd. (BGNE)

The FDA decision on BeiGene Ltd.'s (BGNE) Tislelizumab, proposed as a treatment for patients with unresectable recurrent locally advanced or metastatic esophageal squamous cell carcinoma after prior systemic therapy, is due on July 12.

Esophageal cancer is one of the most common malignant tumors in the digestive tract, with more than 18,400 new cases diagnosed each year in the United States. Esophageal squamous cell carcinoma (ESCC) and Esophageal adenocarcinoma (EAC) are the two main types of esophageal cancer.

If approved, Tislelizumab will have to compete with the likes of Merck's Keytruda and Bristol-Myers Squibb's Opdivo.

Last January, BeiGene granted Novartis rights to develop, manufacture, and commercialize Tislelizumab in North America, Europe, and Japan.

Tislelizumab is already approved in five indications in China namely, advanced squamous non-small cell lung cancer, advanced non-squamous NSCLC, classical Hodgkin's lymphoma, locally advanced or metastatic urothelial carcinoma, and hepatocellular carcinoma.

Sales of Tislelizumab in China were $255.1 million for full year 2021, compared to $163.4 million in the prior year.

BGNE closed Monday's trading at $171.27, down 3.78%.

3. Regeneron Pharmaceuticals Inc. (REGN)

On July 13, the FDA will decide whether or not to approve Regeneron Pharmaceuticals Inc.'s (REGN) REGEN-COV, proposed for the treatment of COVID-19 in non-hospitalized patients and as prophylaxis in certain individuals.

REGEN-COV, a cocktail of two monoclonal antibodies - Casirivimab and Imdevimab - was authorized by the FDA for emergency use in November 2020 for the treatment of mild to moderate COVID-19 in adults and pediatric patients and who are at high risk for progressing to severe COVID-19 and/or hospitalization. Last August, the U.S. regulatory agency authorized REGEN-COV for emergency use as post-exposure prophylaxis (prevention) for COVID-19 in adults and pediatric individuals who are at high risk for progression to severe COVID-19, including hospitalization or death.

In January 2022, the FDA amended the Emergency Use Authorization of REGEN-COV to exclude its use in geographic regions where infection or exposure is likely due to a variant that is not susceptible to the treatment. Therefore, REGEN-COV is not currently authorized for use in any U.S. states, territories or jurisdictions.

REGEN-COV generated zero sales in the first quarter of 2022 compared to $262 million in the year-ago quarter.

REGN closed Monday's trading at $602.40, down 1.65%.

4. Incyte Corp. (INCY)

Incyte Corp.'s (INCY) Opzelura, proposed for the expanded use as a topical treatment for adolescents and adults with vitiligo, awaits the FDA decision on July 18.

Opzelura is a novel cream formulation of Incyte's selective JAK1/JAK2 inhibitor Ruxolitinib.

Vitiligo is a chronic autoimmune disease characterized by depigmentation of skin that results from the loss of pigment-producing cells known as melanocytes. This disease, which can occur at any age, affects approximately 1.9 million to 2.8 million people in the United States.

The drug received FDA approval last September for the topical short-term and non-continuous chronic treatment of mild to moderate atopic dermatitis in non-immunocompromised patients 12 years of age and older whose disease is not adequately controlled with topical prescription therapies, or when those therapies are not advisable.

Launched in October 2021, Opzelura generated net product revenue of $4.7 million in the fourth quarter of 2021, and $12.75 million in the first quarter of 2022.

The main source of revenue for Incyte is Jakafi, which is approved for myelofibrosis, polycythemia vera, and Graft-versus-Host disease. This drug generated net product revenue of $544 million in the first quarter of 2022 compared to $465.7 million in the year-earlier quarter.

For full-year 2022, Incyte expects Jakafi to bring home net product revenue of $2.33 billion to $2.40 billion.

INCY closed Monday's trading at $77.36, down 1.06%.

5. Arcutis Biotherapeutics Inc. (ARQT)

The FDA decision on Arcutis Biotherapeutics Inc.'s (ARQT) Roflumilast cream, proposed for the treatment of plaque psoriasis in adults and adolescents, is due on July 29.

Roflumilast cream is a once-daily topical formulation of Roflumilast, a highly potent and selective inhibitor of phosphodiesterase type 4 (PDE4), an enzyme that drives overactive immune responses. Roflumilast as an oral treatment has been available since 2011 to reduce the risk of exacerbations of chronic obstructive pulmonary disease.

Psoriasis is an immune disease that affects more than 8 million adults in the U.S. About 90% of people with psoriasis have plaque psoriasis, which is characterized by "plaques," or raised, red areas of skin covered with a silver or white layer of dead skin cells.

Amgen's oral Otezla, approved for plaque psoriasis, also belongs to the PDE4 inhibitor class. Roflumilast cream, if approved, would be the first and only topical PDE4 inhibitor for psoriasis.

Topical Roflumilast has potential to generate sales of roughly $2 billion to $4 billion in the U.S. dermatology segment alone by 2030, according to the company.

ARQT closed Monday's trading at $21.73, up 5.43%.

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