Gilead Receives FDA Approval for High Blood Pressure Treatment
Gilead Sciences shares rose in aftermarket trading on Friday after the U.S. Food and Drug Administration approved the drugmaker's treatment for high blood pressure in the lungs.
The FDA said it approved the sale of the five-milligram and 10-milligram once-daily tablets of Letairis, known generically as ambrisentan, following a priority review.
"Letairis represents a valuable addition to the treatment alternatives for this orphan disease," said John Jenkins, head of the agency's new drugs unit, in a prepared statement. "Letairis is similar to an existing drug, but offers the potential for fewer drug interactions."
Gilead, which focuses primarily on antiviral treatments for HIV and hepatitis, acquired the U.S. rights to ambrisentan when it acquired Myogen in 2006. British drug giant GlaxoSmithKline holds marketing rights to the drug outside the United States.
Late last week, Credit Suisse downgraded Gilead shares to "neutral" from "outperform" but raised the price target to $89 from $84.
"We believe the stock will have another leg of growth with the approval and launch of ambrisentan," said analyst Michael Aberman, in a June 6 client report. "However, we believe the market is already expecting a strong launch and the upside is limited."
The analyst noted, however, that a recent Credit Suisse survey makes it "increasingly bullish" on the launch of ambrisentan.
"With expectations for Gilead high and our belief that there is little room for beating consensus, we are stepping to the sidelines for now," he said.