There have been several noteworthy developments in the drug space recently, which will likely have a material impact on the companies in this sector and the markets they serve. Companies mentioned in this review include AbbVie Inc. (ABBV), Pfizer Inc. (PFE Free Pfizer Stock Report), and Merck & Co. (MRK - Free Merck Stock Report).

AbbVie’s Hep-C Drug Shows Promise in Late-Stage Trials

On November 18th, AbbVie announced that a Phase III trial for its experimental, oral-based Hepatitis C treatment showed about 96% of patients had no detectable trace of the virus after 12 weeks. The trial, that has been dubbed Sapphire 1, consisted of 631 patients and is the first of six late-stage studies that AbbVie will be conducting on the drug. Management indicated that the company is on track to make a major regulatory submission sometime in the second quarter of 2014. With roughly 160 million people infected with the Hepatitis C virus across the globe, an approval could represent a significant opportunity for AbbVie, while also providing some much-needed diversity to a portfolio that is highly reliant on one product. Sales of AbbVie’s popular rheumatoid arthritis treatment, Humira, currently account for roughly 55% of the company’s top line.

Pfizer Gains SNDA Approval for Xeljanz

Also on November 18th, the world’s largest drugmaker announced that the U.S. Food and Drug Administration approved its supplemental new drug application (SNDA) for Xeljanz to include additional Patient-Reported Outcomes (PROs) on the label. In patients receiving Pfizer’s rheumatoid arthritis treatment, the additional data shows notable improvements in vitality, role emotional, physical function, bodily pain, social function, mental health, role physical, and general health. Xeljanz, which was cleared by the FDA in November 2012 (and various other countries in 2013), is the first approved rheumatoid arthritis treatment in the U.S. in a new class of medicines called Janus kinase (JAK) inhibitors. While sales of the drug have had a minimal impact on Pfizer’s top line thus far (generated $68 million through the first nine months of 2013), the recent SNDA approval is expected to help improve sentiment in the coming years.

Merck Reports Positive Results for  its Cancer Drug

In mid-November, the New Jersey-based drugmaker announced promising data for its investigational cancer drug MK-3475, part of a new class of medicines known as PD-1 inhibitors that harness the body’s immune system to attack cancer. When used to treat patients with advanced melanoma, the study showed an estimated overall survival rate of 81% at one year across all MK-3475 monotherapy doses evaluated.  The results provide the first look at overall survival rates among 135 patients taking the medication in Merck’s ongoing Phase 1B clinical trial. At present, Merck is studying MK-3475 in more than 3,000 patients across various cancer types including lung, bladder, breast, and colorectal. While a regulatory approval for MK-3475 would certainly represent a lucrative opportunity for the company’s growing oncology business, competition in this space is shaping up to be quite fierce as both Bristol-Myers Squibb (BMY) and Roche Holding AG have similar treatments currently in development.  

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.