3 Healthcare Stocks Waiting For The FDA's Approval

 |  Includes: AVEO, DCTH, INVA
by: Emerging Equities

Shares of Theravance (THRX) have returned more than 9% YTD. This biotechnology and drugs company has a COPD (chronic obstructive pulmonary disease) drug candidate coming up for presentation before FDA's advisory committee on pulmonary allergy drugs.

Two other companies, Aveo Pharmaceuticals (NASDAQ:AVEO) and Delcath Systems (NASDAQ:DCTH), are also waiting for FDA approval of their products. While Theravance and Aveo belong to the biotechnology and drugs industry, Delcath Systems is a medical equipment and supplies company. All three have FDA events coming up in in the second quarter 2013.

This article focuses on information that investors may want to know in order to help them make informed investment/trading decisions.

Theravance Inc.

Theravance is a biopharmaceutical company engaged in discovery, development and commercialization of small molecule medicines/pain. The primary focus of the company is on respiratory diseases, bacterial infections and central nervous system. The company's efforts for discovery are based on the principle of multivalency or the simultaneous attachment of a single molecule to multiple binding sites on one or more biological targets.

The company has a pipeline of internally discovered product candidates and strategic partnerships with pharmaceutical companies, including GlaxoSmithKline (NYSE:GSK). Theravance's key programs in partnership with GSK include Relovair, LAMA/LABA (long-acting beta-2 adrenergic agonists/ long-acting muscarinic antagonists) and bifunctional muscarinic antagonist-Beta2 antagonist.

Salmeterol, the first LABA available in the U.S. seemed like a life saver for asthma patients and was prescribed indiscriminately as treatment for asthma and chronic obstructive pulmonary disease (COPD). However, it became clear very early that LABAs posed a health risk as a monotherapy and would not work without an inhaled corticosteroid.

Breo, earlier known as Relovair, is a combination of fluticasone furoate (NYSE:FF), an inhaled glucocorticoid receptor agonist, and vilanterol (VI), a long-acting beta2 agonist (ICS/LABA), to be administered using Theravance's Ellipta inhaler.

On April 7, 2013, Theravance, developer and GSK, partner are to sit before the FDA's Pulmonary-Allergy Drugs Advisory Committee (PADAC), which will decide the future of Breo. The FDA has set May 5, 2013 the date under Prescription Drug User Fee Act (PDUFA).

On December 18, 2012, Theravance and GSK announced the submission of another new drug application (NDA) with the FDA for approval of a LAMA/LABA combination medicine, UMEC/VI for long term once-daily maintenance bronchodilator treatment of airflow obstruction in COPD patients, including chronic bronchitis and emphysema.

UMEC or umeclidinium bromide is a LAMA and VI or vilanterol is a LABA. The combination drug is to be administered using the Ellipta inhaler. The proposed trade name for the combination drug (62.5/25mcg and 125/25 mcg doses) is Anoro Ellipta.

Aveo Pharmaceuticals Inc.

Aveo Pharmaceuticals or Aveo Oncology is engaged in discovery, development and commercialization of cancer therapies. The company uses its Human Response Platform for building preclinical models of human cancer for getting an insight into cancer biology. The company's lead product candidate is Tivozanib, (proposed trade name, Tivopath), which it partnered with Astellas Pharma Inc.

Tivozanib is an oral VEGF (vascular endothelial growth factor) receptor tyrosine kinase inhibitor. It is an oral quinoline uera derivative, that supprersses angiogenesis by selective inhibition of all three VEGF receptors. It is designed to optimize VEGF blockade while minimizing off-target toxicity.

Tivozanib comes up before FDA's advisory committee on May 2, 2013 for treatment of advanced renal cell carcinoma. It is also being evaluated for solid tumors including breast and colorectal cancers. Astellas Pharma Inc.

The company has two other products in the pipeline. Ficlatuzumab, an antibody that binds to HGF (hepatocyte growth factor) to block its function, is undergoing Phase II evaluation for treatment of non-small cell lung cancer.

In May 2012, the company announced the initiation of Phase I study for examining the safety and safety of AV-203, a clinical-stage ERBB3 (HER3) inhibitory antibody. ERBB3 is a receptor that the company had identified through the use of its Human Response Platform, which is typically expressed in many cancers.

Delcath Systems Inc.

Delcath Systems is a development-stage, specialty pharmaceutical and medical device company focused on oncology, primarily liver cancers. It focuses on development and clinical study of its chemosaturation (CHEMOSAT) system that allows the administration of concentrated regional chemotherapy by isolating the circulatory system of the targeted organ. Once isolated, the Delcath system delivers chemotherapeutic agents directly to the liver. It is a minimally invasive system that involves insertion of three catheters.

CHEMOSAT with melphalan hydrochloride, which will be sold as Delcath Hepatic CHEMOSAT comes up for consideration under the Prescription Drug User Fee Act on June 15, 2013.


All three candidates have good chances of getting approved by the FDA.

  • COPD has been one of the more remunerative disease areas for pharmaceutical companies. Presently, COPD therapies include two leading respiratory drugs: once daily LAMA drug, Spiriva, developed by Boehringer Ingelheim in partnership with Pfizer and GSK's twice-daily Advair, an ICS/LABA combination drug for asthma and COPD.

Advair, GSK's blockbuster combination (fluticasone propionate/salmeterol) drug lost patent protection in 2010. Breo is a part of a program called Horizon, earlier known as Beyond Advair. The program was started despite there being little likelihood of generic drugs appearing as the FDA has not provided guidance for registration of combination respiratory medications.

Boehringer Ingelheim, a privately held company, is also testing a new LAMA/LABA combination medicine but has still not submitted application for approval. However, Theravance's Breo is likely to competition from Boehringer Ingelheim 's monotherapy, olodaterol. In February 2013, the Advisory Committee voted 15-1 in favor of its LABA drug olodaterol. Although the FDA is known not to always follow its advisory committee, there are chances that the drug may get approved.

  • AVEO sponsored an open-label trial for testing Tizozanib with the objectives of testing the efficacy and safety of tivozanib as compared to sorafenib (Nexavar), an already approved therapy for kidney cancer. The efficacy results showed that Tivozanib patients had 20% less probability of progressing as compared to against sorafenib. Tumor response rates for tivozanib were also better and side effects lesser.
  • In April 2011, the Delcath's CHEMOSAT received Conformite Europeenne (NYSE:CE) mark approval as Class III medical device, allowing the company to sell the system in the European Economic Area. It stands a good chance of getting approved for sale in the U.S. as well.

The future of all three companies depends upon the FDA approvals. Investors are well aware that FDA approval can send the price of stock shooting northwards. Considering the potential of the COPD space and also the fact that it has filed another NDA for a second COPD drug, Theravance looks like a potential investment in biotechnology.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.