Update on Glaxo's Pipeline - Analyst Blog

Pipeline updates are highly-awaited events in the pharma/biotech sector as they play an important role in deciding whether to invest in a particular company or not. These updates provide information on experimental drugs.

Last week, GlaxoSmithKline GSK announced positive data from two phase III studies (MEA115588 and MEA115575) on its asthma candidate, mepolizumab. Based on the encouraging results, Glaxo plans to submit marketing applications to regulatory agencies by the end of this year.

The 32-week, randomized, double-blind, double-dummy, placebo-controlled, parallel group, pivotal MEA115588 study (n = 576) compared the efficacy of mepolizumab (75 mg and 100 mg) to placebo for the treatment of severe eosinophilic asthma patients. The study met its primary endpoint. Statistically significant reductions in the frequency of clinically significant exacerbations of asthma compared to placebo were observed in both the 75 mg (47%) and 100 mg (53%) dosages.

Meanwhile, in the second phase III study, MEA115575 (n = 135), it was found that during week 20-24, patients receiving mepolizumab (100 mg) were able to achieve higher reductions in their maintenance oral corticosteroid dose as compared to placebo.

Our Take

We are pleased with the encouraging results on mepolizumab. According to Glaxo, the candidate has the potential to become the first non-inhaled treatment for severe asthma. We believe that mepolizumab, if approved, will further strengthen Glaxo's respiratory portfolio.

Last year, Glaxo in collaboration with Theravance, Inc. THRX had launched Breo. The companies are also preparing to launch Anoro (for chronic obstructive pulmonary disease) in the U.S.  Other respiratory candidates in Glaxo's pipeline include Incruse.

If successfully commercialized, these drugs will compensate for the loss of revenues once Advair – one of Glaxo's highest revenue grossers – goes generic. The product generated sales of $5.3 billion in 2013, accounting for almost 25% of the company's Pharmaceuticals and Vaccines segment revenues.   

Glaxo carries a Zacks Rank #4 (Sell). Some better-ranked stocks include Alexion Pharmaceuticals, Inc. ALXN and Alkermes ALKS. Both carry a Zacks Rank #1 (Strong Buy).