Keryx shares soar on upbeat PhIII results for CKD drug Zerenex

Shares of Keryx Biopharmaceuticals ($KERX) roared into the fast lane this morning, shooting ahead 46% on the news that its long-awaited Phase III study of its phosphate binder Zerenex had wrapped with positive top-line data among kidney dialysis patients. The news positioned the small-cap biotech for marketing applications in the U.S. and Europe.

Most analysts had already come to expect a positive result for this treatment, with even the most skeptical analysts allowing that the data looked good this morning. But regulatory risk has been discounted while commercialization risks have loomed large. A Street fight over Zerenex's commercial potential has been brewing for months, with some in the investment community expecting that current and soon-to-arrive generic competition will severely blunt any drug launch. And that's what company executives zeroed in on swiftly in an investor briefing this morning.

"Zerenex has the potential to be the market leader in the phosphate binder space," Keryx CEO Ron Bentsur asserted this morning, citing their chances at grabbing a big share of a $2.4 billion market.  

Bentsur said that Zerenex met a "highly statistical significant change" in serum phosphorus versus placebo among end-stage renal disease patients on dialysis. The drug is designed to treat hyperphosphatemia, a common condition among patients with chronic kidney disease who need help flushing dangerously high levels of phosphorus. To make its pharmacoeconomic case to payers, the company spotlighted secondary endpoint data which indicated a reduced need for IV iron and erythropoiesis-stimulating agents, or ESAs.

Even a late 2013 or early 2014 approval, though, would put the drug on a collision course with upcoming generic versions of Sanofi's Renvela as well as Shire's Fosrenol, which is why Keryx will be making a case that its branded drug is superior to the alternatives.

The upbeat news was badly needed for Keryx, which saw its share price pummeled back in April over its Phase III setback with the cancer drug perifosine. 

- here's the press release

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