Novartis said on Tuesday it has received U.S. approval for the hypertension drug Tekturna - a potential blockbuster - calming investor fears about the firm's ability to get new drugs to market and boosting its shares by more than 5%.
Novartis said on Tuesday the Food and Drug Administration (FDA) had cleared the once-daily pill Tekturna -- the first in a new class of hypertension medicine -- after a three-month delay while the agency examined more clinical data.
The news is a much-needed shot in the arm for the drugmaker after recent pipeline delays, particularly following a FDA request for more data last week before approving Galvus, another key new product in its portfolio.
"This approval will come as a relief to Novartis following the delay on its diabetes medication Galvus and the previous delay to Tekturna," said Helvea analyst Andrew Fellows.
Tekturna will go on sale in the U.S., its first market, this month. Novartis did not give a price for the drug.
Swiss biotech firm Speedel, which co-developed the drug, said it believed Tekturna had a five-year lead over the next generation of renin inhibitors. Speedel -- whose shares shot up on the news -- has two more renin inhibitors of its own in early- and mid-stage clinical trials.
The American Heart Association estimates that more than 62 million Americans suffer from high blood pressure.
Bank Sarasin expects sales to ramp up quickly, given the company's efficient marketing operation and existing presence in the heart disease market.
First in Class
Novartis had another blood pressure treatment, Exforge, approved recently as it seeks to replace sales of its current top-seller Diovan, a third blood pressure treatment whose patent expires in 2012.
"In our view, the excellent clinical data with Tekturna shown to date suggests that the drug is more than a replacement for Diovan, upon the latter's patent loss in 2012," Vontobel analyst Odile Rundquist said in a note.
Speedel shares had fallen some 18% since late February, on concerns over Tekturna's delay.
Tekturna, which will be known as Rasilez outside the U.S., is the first of a new type of drug, known as renin inhibitors, that could offer additional benefits compared with older medicines.
Tekturna sales could reach $3.6 billion by 2015, Vontobel analysts estimate.
Deutsche Bank analysts said the approval could lead Novartis to raise its guidance for double-digit drugs sales growth for the 2008-2011 period.
Deutsche said Tekturna was approved with a strong label and forecast peak sales of $2.4 billion for the drug, or about 10% of the group's gross profit.
The broker said the drug's label highlighted its additional benefits when added to older treatments, its rapid onset of action and persistent blood pressure reductions after withdrawal, with no evidence of rebound in high blood pressure.
The positive label should encourage doctors to use Tekturna either on its own or, more likely combined with other drugs, Helvea analyst Fellows said.
Tekturna works by targeting renin, an enzyme responsible for triggering a process that can contribute to high blood pressure. It will be sold in the U.S. in March in doses of 150 milligram and 300 mg.
The drug was submitted to the European Medicines Agency for review in the European Union in September 2006.