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Vertex Expects Modest Revenue Growth in This

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Orkambi growth trends

Vertex Pharmaceuticals (VRTX) has projected Orkambi’s revenues to fall in the range of $1.0 billion–$1.3 billion in 2017. The lower end of the estimate is based on revenues that the drug could earn from markets wherein the company has managed to secure reimbursement. This involves the US market, wherein Orkambi is reimbursed for CF (cystic fibrosis) patients above six years of age, and the German market, wherein the drug is reimbursed when prescribed to CF patients above 12 years of age.

Vertex Pharmaceuticals has based its higher revenue estimate for Orkambi on the probability of securing reimbursement in major European markets in 2017.

With the majority of eligible CF patients in the US already using Orkambi, the company has projected 1Q17 drug revenues to be similar to those reported in 4Q16, which is around $277 million.

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Label expansion

On September 28, 2016, Orkambi was approved by the FDA (US Food and Drug Administration) as a treatment option for CF patients with ages six through 11 and having two copies of the F508del mutation. This approval has expanded Orkambi’s label, which was previously indicated for CF patients aged 12 and older. This approval has expanded the addressable market size for Orkambi by 11,000 patients.

Orkambi has witnessed solid uptake from CF patients aged six through 11 in the US as physicians have realized the benefits of initiating therapy at an early stage in CF. Vertex Pharmaceuticals expects a similar trend to unfold in the European market. With Orkambi, Vertex Pharmaceuticals continues to be a major rare disease player similar to peers such as Alexion Pharmaceuticals (ALXN), Incyte (INCY), and United Therapeutics (UTHR).

Notably, Vertex Pharmaceuticals makes up ~0.10% of the SPDR S&P 500 ETF’s (SPY) total portfolio holdings.

In the next part, we’ll explore revenue growth trends for Vertex Pharmaceuticals in greater detail.

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