Pfizer, Inc (PFE) provided an update earlier Wednesday morning related to status of its investigational co-developed breast cancer therapy palbociclib (PD-0332991). The company announced that palbociclib was granted a 'breakthrough therapy' designation by the U.S. Food and Drug Administration (FDA).
Breakthrough status is a designation awarded by the FDA for therapies that address serious or life-threatening conditions and are viewed to have an unmet need. While the news appears to be encouraging, we will not be revising our Pfizer model at this time. The FDA award attempts to provide a path for expedited development and review for therapies meeting the definition. However, it does not suggest that the compound will be more likely to gain future FDA approvals.
In our coverage initiating report on Pfizer, that was released earlier this month, we identified palbociclib as the most promising opportunity existing in the P2 pipeline. As noted, palbociclib offered very encouraging results in its P2 studies that concluded last December.
Palbociclib entered the Pfizer R&D pipeline through the Warner Lambert acquisition via an existing co-development agreement with Onyx Pharmaceuticals (ONXX).
In looking at the potential impact of the release, we believe that Pfizer shares will initially advance following the release which should be viewed as an attractive exit point relative to our $24 price target. It would not be surprising to see a few IBs alter their company rating, forecast and/or price targets based on the news but this simply suggests that the opportunity was initially incorrectly modeled.