Drug company soars with positive drug trial results


The Medicines Company (NASDAQ: MDCO) announced last week that recent test data showed positive results for its flagship cholesterol drug, inclisiran. Shares of the company, which has a market cap of $ 3.82 billion, climbed 9.3% in response to the news, and although the stock has returned most of those gains since then, it has is always very encouraging news for the biotechnology business.

Since the company sold its infectious disease assets in 2017, The Medicines Company has placed almost all of its eggs in one basket. This appears to have been a good move, as the drug candidate appears to have an increasingly optimistic path to final FDA approval.


What happened?

The Medicines Company, alongside its partner, Alnylam Pharmaceuticals (NASDAQ: ALNY), has been working on developing a treatment for patients with high cholesterol for years. Specifically, inclisiran is intended to lower LDL cholesterol in patients with cardiovascular disease, as well as in patients with genetic disorders such as heterozygous familial hypercholesterolemia, an inherited disease that causes high cholesterol. As an RNA therapy, inclisiran helps patients by influencing the body’s protein-making mechanisms to inhibit the production of LDL cholesterol – also known as bad cholesterol – in the body.

In an announcement last week, the company confirmed that its Phase 3 clinical study, ORION-10, met all of its primary and secondary endpoints of lowering LDL levels in patients during the course of the study. trial. At the same time, there were no health consequences in terms of kidney or liver abnormalities, which matches previous studies by the company and reconfirmed the absence of significant side effects from taking inclisiran.

What this means for The Medicines Company

Overall, this is great news for The Medicines Company, with some analysts already seeing the inclisiran as an easy victory.

CEO Mark Timney said:

The results observed in ORION-10 again demonstrate the exceptional efficacy, tolerability and safety of inclisiran. This is further validation of the potential of this first and only experimental cholesterol lowering therapy in the siRNA class to transform the treatment of cardiovascular disease for millions of people with ASCVD. [atherosclerotic cardiovascular disease].

Although there is good competition in the cholesterol lowering space, including Repatha de Amgen (NASDAQ: AMGN), the overall market is large enough that there is plenty of room for competitors. One-third of patients with high cholesterol and plaque-induced arterial blockage do not see significant improvement on a class of drugs called statins and other common cholesterol drugs. This means that of the roughly 35 million patients prescribed statins in the United States, 11.7 million will need drugs or alternative treatments to control their LDL cholesterol.

Cholesterol-lowering drugs such as statins are expected to represent a market of $ 22.6 billion by 2022. Even though only a third or a fifth of all patients switch from statins to alternative drugs such as inclisiran, the size The potential market for these treatments would easily be between $ 5 billion and $ 10 billion.

Other positive developments

In December 2018, the company announced that it had appointed Timney as the new CEO. His previous experience includes working at Merck (NYSE: MRK), where he participated in the launch of cardiovascular products for the pharmaceutical giant. This experience fits perfectly with The Medicines Company as the company moves from research and development to preparing for a possible launch. For now, regulatory submissions for the cholesterol drug are expected to take place in the fourth quarter of 2019.

From a financial standpoint, The Medicines Company is also in a good position. As of June 30, 2019, the company had $ 319.3 million in cash or cash equivalents, which is enough to last approximately nine more months, according to management’s estimates. While these reserves don’t last forever, it’s easy to see the company pursuing additional fundraising activities if it needs to strengthen its position.

Overall, the outlook looks pretty good for the company as well as its stock. While investors cannot ignore the fact that the FDA has yet to approve the drug and anything can happen in the meantime, The Medicines Company seems to have a bright future ahead of it.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.

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