Genmab data points to early bone cancer drug launch: analysts

[February 04, 2015]  By Teis Jensen

COPENHAGEN (Reuters) - Positive results from a trial by Danish biotech company Genmab of its bone marrow cancer drug could lead to a launch as early as this year and it may become a blockbuster treatment earning $3.5 billion in annual revenues, analysts said.

Genmab said the study of daratumumab, which evaluated multiple myeloma patients who had already had at least three different lines of therapy unsuccessfully, showed an overall response rate of 29.2 percent.

The response rate indicated Genmab's drug worked better than two recently approved drugs, Onyx Pharmaceuticals' Kyprolis and Celgene's Pomalyst, although these have been tested in different ways, Sydbank analyst Soren Lontoft Hansen said.

Shares in Genmab rose by as much as 10 percent early on Wednesday to a record high of 467.80 Danish crowns per share before trimming gains to 461 crowns at 1129 GMT.

Hansen said the data increased the probability of an approval from the U.S. Food and Drug Administration (FDA) and that it could be launched this year. He raised his recommendation on the share to 'buy' from 'hold'.

"We believe the data is very positive and well above the FDA threshold for approval. We therefore expect the study results to lead to U.S. approval of daratumumab in the second half of 2015," Danske Bank analysts said in a note. It raised its target price to 530 crowns and maintained a 'buy' recommendation.

A spokeswoman from Genmab said the company would not disclose its expectations for the timing of an approval or for the potential peak sales of daratumumab.

Nordea raised its target price on Genmab to 670 crowns from 450 crowns and said in a note that it now sees a 90 percent probability of success for daratumumab.

Analysts at Jefferies, which has a buy recommendation on Genmab, sees an 80 percent probability of commercial success for daratumumab and that the drug could reach annual peak sales of $3.5 billion.

Jefferies expects a potential launch of daratumumab in the first half of 2016.

Genmab's share price has more than doubled in the last six months - including Wednesday's gains - outperforming a 10 percent rise in the Danish benchmark index.

"It is because it has become more evident to the market that daratumumab is a very potent drug and that it is getting closer to an approval," Hansen said.

Genmab has a market cap of almost 24 billion Danish crowns ($3.69 billion).

(Editing by Sabina Zawadzki and Susan Thomas)

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