UBS Investment Research
Johnson & Johnson
Panel recommends ustekinumab approval
Panel unanimous in recommending approval
An FDA panel voted unanimously (11 Yes, 0 No) in favour of recommending approval for ustekinumab (tentatively trade named STELARA) for the treatment of adult patients with moderate to severe plaque psoriasis. The panel was unanimous
(11 Yes, 0 No) in their view that ustekinumab has been shown to be efficacious.
Questions about safety may require mandatory post-approval registry
The panel was unanimous in its belief that not enough safety data was provided to characterize the safety concerns with ustekinumab and were unanimous in expressing concern about the potential cancer risk with the drug. However, the committee believed that the benefits of ustekinumab in psoriasis patients
outweighed the potential risks (9 Yes, 1 No, 1 Abstained). Extensive post-approval
risk assessment was recommended, including a potential mandatory registry.
Expectations unchanged
Consistent with the panel’s recommendation, we expect the FDA will approve ustekinumab. We estimate ustekinumab will "capture 4% share of US psoriasis patients treated with biologics in 2009, growing to 13% in 2012 ($224M US,
$345M WW)." We believe that uptake will be measured, despite the drug’s excellent efficacy and 3 month dosing interval, given the new mechanism of action, the long half life of the drug, lingering concerns about cancer risk, and the conservatism of dermatologists.
Valuation
We utilize UBS’ proprietary VCAM (DCF) to set our $75 price target. [for JNJ that is].
Sales potential: $ 224 mln by 2009, $ 345 mln by 2012.
[Medarex royalties are in the 3-5 % range]. |
