Odds Are High For Approval of InterMune’s (ITMN) Pirfenidone
Analysts at Wells Fargo Securities upgrade InterMune Inc (NASDAQ: ITMN) from "market perform" to "outperform."
According to Wells Fargo Securities, the upgrade in the rating is based on the Pulmonary-Allergy Drugs Advisory Committee (PADAC) panel’s approval of ITMN’s drug, pirfenidone. “Although, the data are mixed and complex, with CAPACITY 1 failing/CAPACITY 2 succeeding and neither demonstrating a significant mortality benefit, the panel was swayed by the totality of data and lack of treatment options for idiopathic pulmonary fibrosis (IPF). Although it is not without some hesitancy due to a lack of conviction in the data set, we believe that the agency will act in accordance with the panel's recommendation based on the prior action history of this FDA division and the FDA's body language throughout the meeting,” the analysts say.
Wells Fargo Securities mention that “although we expect slight delays due to the need to develop a post-marketing registry proposal, we believe the odds of eventual approval in the US and EU without the requirement for another trial are ~75%. We believe shares trade higher on expectations of broad market penetration combined with the recognition of late stage product scarcity value. There are 100,000 patients in the US and 30,000 new patients diagnosed each year with IPF. Most important, there are no approved products. Despite a likely $30-50k annual cost for pirfenidone, we expect fairly widespread use given the lack of options.”
