SAN FRANCISCO ( TheStreet) -- Medivation (MDVN) and its partner Astellas will soon announce results from a phase III study of the prostate cancer drug Xtandi. This is a very important study for Medivation because a positive outcome is likely to transform Xtandi into a blockbuster cancer drug. As you might expect, Wall Street is paying close attention, waiting anxiously for the companies to announce results.
Here's an FAQ on what to expect from the Xtandi study, known as PREVAIL:
Xtandi is already approved to treat prostate cancer, so remind me why this PREVAIL study is important?
You're right, the FDA approved Xtandi in August 2012 to treat men with advanced prostate cancer, specifically those with cancer that no longer responds to chemotherapy. If you want to be hip to the lingo, these are "post chemo" prostate cancer patients.The PREVAIL study is being conducted in "pre chemo" prostate cancer patients. These men have less advanced disease and have not yet been treated with chemotherapy. Less advanced prostate cancer means more patients to treat and a more lucrative commercial market opportunity for Medivation and Astellas? Bingo. Medivation has guided to 2013 Xtandi sales in the range of $345-365 million, based only on treating post-chemo prostate cancer patients. If the PREVAIL study is positive and Xtandi wins an expanded FDA approval for pre-chemo prostate cancer, Xtandi sales are likely to be on a billion-dollar run rate by the end of 2014. Peak sales in prostate cancer could be in the $3 billion range. The drug is also being studied in breast cancer. Medivation's market value already tops $4.3 billion, so.... Yeah, I get what you're saying. Substantial, future Xtandi sales are baked into Medivation's stock price already.
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