Positive cancer drug news causes AstraZeneca share prices to rise
AstraZeneca are looking towards the future and have moved a key oncology drug into mid stage trials, as they begin to reinforce its cancer research pipeline.
Alexandra Hauber is a UBS analyst and she tells investors that the new treatment has huge blockbuster potential as colorectal cancer is the third leading cause of cancer related deaths in the US. The news came over the weekend when AstraZeneca reported new Phase II enrolment data on public study site clinicaltrials.gov.
MEDI-4736 is part of a closely-watched class of drugs known as anti-PD-L1 therapies, which can essentially teach the body to help fight tumours.
AstraZeneca, Bristol Myers-Squibb, Merck and Roche have all been working on drugs which are designed to boost the bodies immune system’s capacity to fight tumours. With this market in particular thought to be very profitable, many experts believe it could be worth $30 billion by 2020
AstraZeneca have been bullish about the prospects for the drug. They have forecasted a potential peak sales for MEDI-4736 of $6.5 billion, this also include the drug being used in combination therapies.
PD-1 inhibitor produced by AstraZeneca is likely to third or fourth type of this drug to hit the market with rivals Merck and Bristol Myers-Squibb leading the race with their drugs. Although AstraZeneca’s drug will likely be the first in this new class of medicines for colorectal cancer.
Current treatments for this disease include Roche’s Avastin (bevacizumab) and Merck KGaA’s Erbitux (cetuximab), both of which target certain genetic sub-types of the colorectal cancer.
AstraZeneca is due to present more data on MEDI-4736 in lung cancer and head and neck cancer at an oncology conference in Madrid at the end of September.
The latest data is a great indication that AstraZeneca are in a strong place even with its ongoing battle with US giant Pfizer, who attempted to buy the firm in May for $118 billion. Even though Pfizer failed with their bid back in May, they can begin private talks this week over a renewed bid however this is on the terms that AstraZeneca want to actually listen to an offer. Pfizer are unable to make a public offer for the company until November 26th.
But hopes are growing that a deal is still on the cards and investors have sent AstraZeneca’s shares up almost 12% in the last fortnight on speculation talks between the two companies might be revived.
The latest MEDI-4736 data will come as pleasurable reading for Pfizer, given how well it can fit within its own new focus on oncology, and the fact that it is not currently in the PD-1 race.
On the other side AstraZeneca will be buoyed by the new data as a reassurance to its shareholders that it can produce strong revenue in the future on its own, without the need to be merged into Pfizer.
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