Shire ($SHPG) picked up the FDA's promise of a fast review for its new dry eye drug, a treatment the company believes can eventually bring in more than $1 billion a year.
The drug, lifitegrast, is a small-molecule therapy designed to interrupt the immune process that leads to dry eye disease. The agency has accepted Shire's application, filed earlier this year, and enrolled lifitegrast into its priority review program, guaranteeing a truncated review and expecting to make a final decision on the drug by Oct. 25.
Lifitegrast is a key cog in Shire's plan to effectively double its annual sales to $10 billion by 2020, and the drug, acquired in the company's $160 million buyout of SARcode Bioscience in 2013, has the potential to bring in $1 billion a year on its own, according to management. Behind lifitegrast, Shire is expecting big things from SHP626, a treatment for non-alcoholic steatohepatitis (NASH), and SHP607, a protein-replacement therapy for the rare retinopathy of prematurity.
But Shire's pipeline bluster took a blow on Thursday when the company revealed that SHP625, a liver disease drug acquired in its $260 million Lumena Pharmaceuticals buyout, failed to meet its primary and secondary goals in a Phase II study. The results dampened analysts' optimism for the program and may dent Shire's projection of reaping $2 billion peak sales from SHP625 and SHP626 combined.
|Shire CEO Flemming Ornskov|
Investors, however, appear to be bullish on Shire's prospects on the whole. SHP625's Phase II failure sent the Big Biotech's shares down about 2% on Thursday morning, but the afternoon news of lifitegrast's priority review sent them up 4% on the day.
Meanwhile, Shire is pressing forward with a company-record 21 drugs in clinical development, building what CEO Flemming Ornskov says is its strongest pipeline ever. Shire is moving on after AbbVie's ($ABBV) plot to buy the company for $55 billion fell apart last year, giving the Irish drugmaker a new lease on freedom and a $1.6 billion breakup fee for its trouble.
- read the announcement