Zacks_Analysts' Blog : Novartis Presents Positive Data - Analyst Blog

Recently, Novartis AG (NVS) presented data from a phase II study of its drug Afinitor at the annual Antonio Breast Cancer Symposium. The study was testing Afinitor plus hormonal therapy tamoxifen in patients with advanced metastatic breast cancer who have been previously treated with an aromatase inhibitor (AI).

The data showed that the combination treatment delays disease progression compared to tamoxifen alone. Almost 61% of patients on the combination treatment had no tumor progression at six months versus 42% on tamoxifen alone.  Patients on the combination treatment saw their disease progression being delayed by a median time of 8.6 months versus 4.5 months in patients treated with tamoxifen alone.

Afinitor works by blocking a protein that helps cancer cells divide and grow. It is currently marketed for advanced renal cell carcinoma (kidney cancer) after an anti-VEGF therapy like Roche’s (RHHBY) Avastin, Pfizer’s (PFE) Sutent or Onyx Pharmaceuticals’ (ONXX) Nexavar.

Novartis is currently conducting a phase III trial called BOLERO that is evaluating Afinitor in metastatic breast cancer.

Limited treatment options are available for breast cancer patients with advanced disease resistant to hormonal therapies. Approximately 30% of women with breast cancer eventually develop metastatic or advanced disease. It is estimated that breast cancer caused approximately 460,000 deaths worldwide in 2008.

Our Recommendation

Currently, we have a Neutral recommendation on Novartis, which is supported by a Zacks #3 Rank, which translates into a short term Hold rating. We are pleased with Novartis’ wide range of products and its efforts to diversify further as is evident by the recent acquisition of a majority stake in Alcon (ACL). The company is looking to acquire the remaining stake in the eye-care company.  However, we prefer to remain on the sidelines due to the upcoming patent cliff for the company as a number of Novartis drugs will face generic competition between 2011 and 2015.