Sanofi: Kynamro recommended for approval by the FDA AdCom

Fair Value EUR80 (+15%)       BUY
News published on October Friday 19, 2012
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ANALYSIS

  • The EMDAC (Endocrinologic and Metabolic Advisory Committee) yesterday voted 9 to 6 in favour of Genzyme’s mimopersen (Kynamro) for its marketing approval for patients with homozygous familial hypercholesterolemia (HoFH), a rare disease that affects around 300 Americans. A day after Aegerion’s lomitapide, which was supported by a stronger vote of 13/2 in its favour, a second option for this very difficult-to-treat and deadly disease has therefore been recommended for approval by the FDA’s Adcom. The PDUFA date is scheduled for 29th January 2013. Shortly the CHMP is also expected to act on the same file in Europe and if not today, it is expected to do so next month i.e. on 15th November.
VALUATION
  • EMDAC support is good news for Genzyme and Sanofi. The impact on valuation is difficult to assess given the significant number of question marks and swing factors still concerning the drug. First is the drug's status in Europe where it was filed for HoFH but also for severe HeFH which is a more significant opportunity (40,000 patients in total in the US and Europe according to Sanofi); second is pricing since levels as high as USD300,000 per patient per year have been mentioned but we do not expect confirmation until final approval (and this will not be applicable if severe HeFH is included in the label); third, the battle against Aegerion is not an easy one to model.
  • Pending further details, we are maintaining Kynamro in our estimates with a peak sales forecast of EUR200m.
NEXT CATALYST
  • 25th October 2012: Q3 results
Eric Le Berrigaud, eleberrigaud@bryangarnier.com

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