Priority Review for HGSI's Benlysta - Analyst Blog

Human Genome Sciences, Inc. (HGSI) received a huge boost when its potential blockbuster drug candidate Benlysta was granted priority review status by the US Food and Drug Administration (FDA). Benlysta, co-developed by Human Genome and GlaxoSmithKline plc (GSK), has been developed for the treatment of patients suffering from systemic lupus erythematosus (SLE).

The US regulatory authority generally reviews those drugs on a priority basis, which offer major advances in treating diseases having no adequate therapy. Applications for priority review designated drugs are reviewed by the FDA within six months of submission instead of the usual ten months. Consequently, a response from the FDA should be out in the fourth quarter of 2010 (projected target date: December 9, 2010).

The Biologics License Application (BLA) seeking marketing approval for the lupus candidate in the US was filed by the companies on June 9, 2010. The Marketing Authorization Application (MAA) seeking approval for Benlysta in Europe was also filed with the European Medicines Agency (EMA) in the same month (June 4). The drug is under review in Europe.

The application includes data from two late-stage trials, BLISS-52 and BLISS-76. Both double-blind, placebo-controlled, multi-center studies evaluated the efficacy and safety of Benlysta in combination with the standard of care against placebo plus standard of care in seropositive SLE patients. The studies evaluated a total of 1,684 patients.

We remind investors that Benlysta, a human monoclonal antibody that specifically recognizes and prevents the biological activity of B-lymphocyte stimulator (BLyS), met the primary endpoint in the BLISS-52 trial in 2009. Furthermore, Benlysta met the primary end-point in BLISS-76 through 52 weeks in November 2009. However, Benlysta did not prove to be more effective than placebo in the long-term according to the complete 76-week data from the BLISS-76 trial announced earlier this year. Benlysta, if approved, would be the first new lupus drug to be approved in 50 years.

Our Recommendation

Human Genome currently has a Zacks #3 Rank, which translates into a short-term Hold rating. We are also Neutral on the stock in the long term. The long-term stability offered by the potential approval of Benlysta is the main reason behind our Neutral stance on the stock. The stance indicates that the stock is expected to perform in line with the US equity market over the next 6+ months. We advise investors to retain the stock over the time period.