A View From The Markets: Incyte, Novartis, and Ruxolitinib

Incyte (INCY) and their partner Novartis have reported that ruxolitinib (INC424), has met its primary endpoint of significantly reducing spleen size in patients with myelofibrosis (MF), when compared to best available therapy in a second Phase 3 trial. The European study, called COMFORT-II, showed that treatment with ruxolitinib provided a statistically significant reduction in spleen size in patients with primary MF, post-polycythemia vera myelofibrosis (PPV-MF), or post-essential thrombocythemia myelofibrosis (PET-MF), when compared with best available therapy. The company reported that the safety profile for ruxolitinib was consistent with previous studies. Regarding concerns about the potential for anemia, we will have to see the full details before we can put the issue to rest. Complete study data was not revealed in the company’s press release which will allow INCY to submit the data for presentation at an upcoming medical meeting. We expect the data to be presented in Chicago at this year’s ASCO. It should be well received since there are no current treatments approved specifically for MF.

An NDA filing for ruxolitinib consisting of COMFORT-II and COMFORT-I will be submitted to the FDA in the second quarter, with a European filing shortly following the FDA filing. The drug candidate has received orphan drug status in both the U.S. and in Europe which means that it will be reviewed in six months, rather than the normal 12 months for regular NDAs, positioning ruxolitinib for two regulatory approvals by year-end. The news flow for the drug candidate in 2011 will be outstanding:

• Submit NDAs in both U.S. and Europe in Q2.
• Present COMFORT-I and COMFORT-II data at ASCO in June.
• FDA advisory committee meeting.
• Receive FDA/European approvals in late Q3/early Q4.
• Launch ruxolitinib in the U.S., possibly before the end of the year.

We raised our buy limit on INCY in late January from $12 to $15 based on a short piece (written by supporters of a rival drug from YM Biosciences, which has potential, but clearly is behind ruxolitinib) that claimed ruxolitinib caused anemia and only reduced symptoms. They claimed these problems would lead to an inevitable delay by the FDA. We believe that the addition of positive Phase 3 results from COMFORT-II to COMFORT-I will be sufficient to earn ruxolitinib regulatory approval. Finally, the full data set that we expect to be presented at ASCO should put to rest lingering safety concerns. 2011 is shaping up to be a transformative year for INCY as they bring their first drug to market. The bottom line is that stock is less risky now than when we raised our buy limit in January. Since that time the stock price has drifted lower, and we urge subscribers to take advantage. INCY is a buy under $15.

You can view a previous blog entry on INCY from John McCamant here:


By John McCamant

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