United Therapeutics: Why Tyvaso Is Still a Key Growth Driver



Tyvaso demand

Despite lackluster performance in 3Q16, United Therapeutics (UTHR) is confident about Tyvaso’s growth prospects for future years. The company believes that the dip in the drug’s demand is transient. A portion of pulmonary arterial hypertension (or PAH) patients using Actelion Pharmaceuticals Opsumit witness disease progression. However, instead of switching to Tyvaso or Remodulin, they try out other oral therapies such as Uptravi or Orenitram. Patients tend to prefer oral therapies due to convenience. However, while this trend may impact Tyvaso’s sales in few quarters, it doesn’t affect the long-term demand for the drug. The pool of patients using oral therapies for longer periods will ultimately be using Tyvaso and Remodulin.

These demand trends may have a positive impact on United Therapeutics’ stock as well as the iShares Nasdaq Biotechnology ETF (IBB). United Therapeutics makes up about 1.1% of IBB’s total portfolio.

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Label expansion

The company has seen positive results from a Phase 3 trial, BEAT, evaluating the efficacy of Tyvaso in combination with esuberaprost for Group 1 PAH. The results are expected to double the average time patients use Tyvaso. Further, the Phase 3 trial INCREASE is expected to expand Tyvaso’s label in the unexplored Group 3 PAH segment. Tyvaso is patent-protected up to 2028. To learn more about these Phase 3 trials, see $1 Billion Sales Target in Place for Tyvaso.

In the next part of this series, we’ll analyze the growth drivers for Orenitram in greater detail.


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