On October 23, 2015, Alexion Pharmaceuticals’ (ALXN) Strensiq was approved by the FDA as a therapy for perinatal, infantile and juvenile-onset HPP (hypophosphatasia) patients. The approval of the drug was based on clinical trial data which demonstrated an overall survival rate of 97% in patients treated with Strensiq at the end of 48 weeks. It’s significantly higher than the 42% overall survival rate witnessed by historical control patients. Strensiq also managed to demonstrate a superior clinical profile based on three secondary endpoints, invasive ventilator-free survival, skeletal manifestations of HPP, and improvements in height and weight. Strensiq’s strong label has been a key factor in driving the demand for the drug in the US, Japan, and Germany.
If Strensiq continues to demonstrate solid revenue growth in future quarters, it could have a positive impact on the share prices of Alexion Pharmaceuticals as well as the PowerShares QQQ (QQQ). Alexion Pharmaceuticals accounts for ~0.48% of QQQ’s total portfolio holdings.
The above graph shows the growth in Strensiq’s revenues after the launch of the drug in 4Q15. The rate of revenue growth might increase as Alexion Pharmaceuticals concludes reimbursement-related negotiations in other international markets.
Alexion Pharmaceuticals has been involved in creating awareness related to HPP as well as methods of diagnosing the disease for the past three years. These efforts led to steady revenue growth for Strensiq in 2016. The efforts also helped the company identify eligible patients even before the FDA approved the drug.
Strensiq is expected to enable Alexion Pharmaceuticals to pose strong competition to other orphan disease players such as Vertex Pharmaceuticals (VRTX), United Therapeutics (UTHR), and Alnylam Pharmaceuticals (ALNY).