Theravance Inc (THRX), GlaxoSmithKline plc (ADR) (GSK): Investors Should Brace for a Busy Week From the Biotech Sector

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With second-quarter earnings season now in the books and about a month to go before third-quarter earnings kicks off, biotech savvy investors are in for a treat this week with three separate events from the Food and Drug Administration likely to garner a lot of attention.

Anoro ellipta
On Tuesday, Theravance Inc (NASDAQ:THRX) and GlaxoSmithKline plc (ADR) (NYSE:GSK) are scheduled to meet with the FDA panel with regard to their chronic obstructive pulmonary disease inhaler anoro ellipta. If the briefing documents released Friday are any indication of how the meeting will go, shareholders in both companies should be fairly excited with the FDA finding only benign problems with the drug and noting it was quite effective in both doses.

Theravance Inc (NASDAQ:THRX)

If recommended positively by the FDA’s panel and approved by its PDUFA date in mid-December, anoro ellipta would become the second long-acting COPD inhaler developed by the collaboration of Theravance Inc (NASDAQ:THRX) and GlaxoSmithKline plc (ADR) (NYSE:GSK) to make it to market in less than a year — the other being Breo Ellipta. It would also firmly solidify GlaxoSmithKline plc (ADR) (NYSE:GSK) and Theravance Inc (NASDAQ:THRX) as the premier COPD drugmakers.

However, there are other beneficiaries here, too. Elan Corporation, plc (ADR) (NYSE:ELN), which is in the process of being purchased by Perrigo for $8.6 billion, took a $1 billion stake in Theravance Inc (NASDAQ:THRX) back in May for 21% of the royalties earned by Theravance Inc (NASDAQ:THRX) from the sale of its four-drug COPD partnership with GlaxoSmithKline plc (ADR) (NYSE:GSK). Should anoro ellipta be viewed favorably this week and eventually approved, it becomes a positive for Elan Corporation, plc (ADR) (NYSE:ELN) which promised to return some of those royalties to shareholders as a dividend and thus Perrigo as well.

On Thursday, Roche Holding Ltd. (ADR) (OTCBB:RHHBY) shareholders can look forward to an FDA panel meeting of their own. Already approved to treat metastatic HER2-positive breast cancer in combination with Herceptin and docetaxel for patients that haven’t received any prior chemotherapy, Roche Holding Ltd. (ADR) (OTCBB:RHHBY) is hoping to add an additional indication (known as a supplemental biologics license application, or sBLA) for Perjeta to be used as a neoadjuvant treatment (i.e., before surgery) in for patients with early stage HER2-positive breast cancer.

In the company’s Neosphere study which involved 417 people who had recently been diagnosed with early stage HER2-positive breast cancer, the combination of Perjeta, Herceptin, and docetaxel induced a pathological complete response (pCR) in 45.8% of patients which was 58% higher than the next closest therapy option of the combination of Herceptin and docetaxel which delivered a pCR of 29%. In its Tryphaena study, the combination of drugs proved favorable in turning in no more serious adverse events than the current standard of treatment.

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