Endo's Back Pain Drug Disappoints - Analyst Blog
02 July 2011 - 2:20AM
Zacks
Endo Pharmaceuticals (ENDP) recently suffered a
pipeline setback with its candidate axomadol performing
disappointingly in a mid-stage trial (n=236). Top line results from
the study revealed that Endo Pharma’s candidate failed to meet the
predetermined end points.
The randomized, double blind, two-arm, placebo-controlled study
evaluated the candidate in patients suffering from
moderate-to-severe chronic low back pain. Endo Pharma in-licensed
the US and Canadian development and marketing rights of axomadol
from Grunenthal in 2009.
The 4-week study evaluated the candidate at doses ranging from
100 mg/day to 300 mg/day. The maintenance phase of the study was 12
weeks. The main goal was a change in the average intensity of pain
measured by a numerical rating scale from baseline to the final
week of treatment for all patients who were treated with at least
one dose of axomadol. Following the disappointing results, Endo
Pharma is evaluating options for further development of the
candidate.
The failure of axomadol has pushed the pain franchise at Endo
Pharma further back. The pain portfolio is already facing
uncertainty due to the generic threat hanging over its lead drug
Lidoderm. Endo Pharma’s pain products compete with products from
players such as Pfizer (PFE) and Cephalon
Inc. (CEPH).
To counter the loss of revenues due to the generic threat Endo
Pharma has adopted the strategy of growth by acquisition. In June
2011, Endo Pharma acquired American Medical Systems, a leading
pelvic-health device provider, for approximately $2.9 billion. By
acquiring American Medical, Endo Pharma diversified its business
and bolstered its urology portfolio.
We note that the purchase of American Medical is the fourth
major acquisition for Endo Pharma over the last one year. Endo
Pharma completed three major acquisitions in 2010. In December
2010, Endo acquired privately held generic company Qualitest
Pharmaceuticals for $1.2 billion. During 2010, Endo Pharma also
bought Penwest Pharmaceuticals Co. and HealthTronics Inc., a
provider of urology products and services.
Our Recommendation
We have a Neutral stance on Endo Pharma. The stock carries a
Zacks #3 Rank (Hold rating) in the short run.
CEPHALON INC (CEPH): Free Stock Analysis Report
ENDO PHARMACEUT (ENDP): Free Stock Analysis Report
PFIZER INC (PFE): Free Stock Analysis Report
Zacks Investment Research
Cephalon (NASDAQ:CEPH)
Historical Stock Chart
From Jun 2024 to Jul 2024
Cephalon (NASDAQ:CEPH)
Historical Stock Chart
From Jul 2023 to Jul 2024