Here are ML's notes on the PHRM results and how it'll affect SUPG/MOGN. As always, no link.
Vidaza data should expand MDS market, Dacogen sales
MGI’s stock is likely to be negatively impacted today by positive data from a competitive drug to Dacogen, which showed that Pharmion’s Vidaza increased survival in MDS patients. Once the data is presented in 4Q, we expect Dacogen sales growth to temporarily slow until MGI provides similar data in mid-2008.
Importantly, given that Vidaza is merely a precursor form of Dacogen, many docs will interpret the Vidaza results as positive for Dacogen as well, which is likely to
expand the market opportunity for both products. We are maintaining our estimates and we would use today’s weakness to aggressively BUY MGI’s stock as we continue to believe that better than expected Aloxi sales will drive
accelerating EPS growth and upside to numbers. Dacogen ramp may pause, survival data mid-08 Pharmion will present the Phase III survival data Vidaza in MDS at the American
Society of Hematology (ASH) meeting in December, which may temporarily slow the rapid Dacogen launch. However, MGI expects survival data for Dacogen from a Phase III EORTC trial in high-risk MDS by mid-08, which should re-accelerate
Dacogen sales if positive. Also, more doctors are using the low-dose Dacogen regimen, and administering more cycles, which may offset the Vidaza data.
Vidaza is Dacogen precursor, both drugs should benefit
Vidaza is only active when converted to decitabine (Dacogen), therefore doctors may translate positive survival for Vidaza as a positive for Dacogen. Importantly,
since the introduction of Dacogen, the MDS market has expanded, which should continue based on positive Vidaza data. We are maintaining Dacogen estimates based on the assumption that market expansion will balance higher competition. Maintain BUY |
