BioMarin Pharmaceutical Inc. BMRN filed a new drug application (NDA) for vosoritide to the FDA to treat children with achondroplasia, the most common form of dwarfism for which no drug is approved yet.

The company filed a regulatory application for vosoritide, a once daily injection analog of C-type Natriuretic Peptide (CNP), in the EU in July. The European Medicines Agency (EMA) commenced the review process on Aug 13. The regulatory applications are based on final data from a phase III study, evaluating the efficacy and safety of vosoritide in children (aged 5-14), long-term safety and efficacy data from the ongoing phase II and phase III extension studies and extensive natural history data.

In December 2019, BioMarin announced positive top-line data from the phase III study, which showed that patients treated with the candidate achieved placebo-adjusted change from baseline in growth velocity of 1.6 cm/year after treatment duration of one year.

A potential approval will make the drug the first and only approved treatment for achondroplasia in the United States. BioMarin estimates that around 25,000 children suffer from this disorder in its commercial territories, which represents decent sales growth opportunity.

Meanwhile, Ascendis Pharma ASND also has an achondroplasia candidate, TransCon CNP in a phase II study.

Another key candidate in BioMarin’s pipeline is Roctavian ( valoctocogene roxaparvovec), an investigational gene therapy, developed for treating patients with severe hemophilia A. BioMarin had filed a biologics license application (BLA) for Roctavian in December last year. However, in a surprise move, on Aug 19, the FDA issued a complete response letter (CRL) to Roctavian’s BLA ahead of Aug 21 PDUFA date.

The BLA application was based on interim data from an ongoing phase III study and the updated three-year results from a long-term phase I/II study. In a new requirement, the FDA asked for two-year follow-up data on annualized bleed rates from the ongoing phase III study to provide additional evidence of a durable effect. The data is not expected to be available before November 2021.

The CRL came as a massive disappointment to investors and shares crashed more than 35% on Wednesday in response.

This year so far, BioMarin’s shares have declined 11.5% against the industry’s increase of 2.7%.

Investors were expecting the FDA to grant accelerated approval to the drug on the PDUFA date. It was expected that Roctavian, if approved, would be a transformational product as it has the potential to dramatically change the treatment paradigm. However, the CRL now pushes potential approval of Roctavian to 2022.

Zacks Rank and Stocks to Consider

BioMarin currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the biotech sector are Emergent Biosolutions EBS and Horizon Therapeutics Public Limited Company HZNP, both with a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Emergent Biosolutions’ earnings per share estimates have moved up 56.4% for 2020 and 44.1% for 2021 over the past 30 days. Share price of the company has increased 143% this year.

Horizon Therapeutics’ earnings per share estimates for 2020 have risen 58% while those for 2021 have gone up by 55.4% over the past 30 days. The stock has risen 107.5% this year so far.

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