SuperGen Bust a Boon for Celgene (Update)

Updated from 10:52 a.m. EDT

Anticancer company SuperGen (SUPG Quote - Cramer on SUPG - Stock Picks) said Tuesday that its Dacogen failed a late-stage trial in patients with myelodysplastic syndromes (MDS) -- news that may lend advantage to competitor Celgene's (CELG Quote - Cramer on CELG - Stock Picks) Vidaza, which will be relaunched this fall.

According to preliminary data from the phase III study, Dacogen injection didn't demonstrate a statistically significant advantage for the median survival time to best standard of care in elderly patients with MDS, a group of bone-marrow diseases that limit the production of functional blood cells.

However, the company said response rates in the 233-patient study -- despite a lack of statistical significance -- were similar to those seen in other trials in MDS.

Dacogen was approved by the U.S. Food and Drug Administration in 2006 and is indicated for the treatment of patients with both previously treated and untreated MDS.

The drug competes with Celgene's Vidaza. "The key issue in the past is that the two drugs, Celgene and Pharmion's Vidaza and Dacogen were the 'same,'" says SummerStreet Research's Tony Caserta. Thus, the way to differentiate between them is in clinical trials, and these results may be enough to change prescribing habits, he says.

A nine-month median survival benefit (shown in a trial last fall) should be incorporated into Celgene's label for Vidaza for its relaunch in the second half of 2008.

JP Morgan analyst Geoffrey Meacham remarked on the likelihood that Vidaza will not harness an overly dominate share of the market on the recent study results, in a note to investors Tuesday. "The Street seemed to assume roughly a 60/40 share split in favor of Vidaza, and now we anticipate Celgene estimates will have to come up to accommodate what could be a 90/10 market split in favor of Vidaza," Meacham wrote. "In this scenario, it could drive an additional 5-6% EPS upside to our current above-consensus estimates."

« Previous Page

1 2

Next Page »