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Onyx Fails to Get Speedy Review for Cancer Drug


Some analysts still predict approval of the drug carfilzomib for multiple myeloma. But a delay may push market clearance to 2014.

Onyx Pharmaceuticals (ONXX) was hoping for a speedy review of its experimental cancer drug carfilzomib in hopes of getting the treatment to market quickly. That's not going to happen.

The company says the US Food and Drug Administration will not grant a priority review of the drug, which pushes out a possible approval until the second half of 2014, according to at least one analyst.

Canaccord Genuity analyst George Farmer expected the drug to be approved for sale by next year. But Farmer says he doesn't believes that's possible as the FDA will require more study data before making a decision. Farmer says he believes the drug will be approved. He calls his 2014 estimate conservative.

When it applied for market clearance for the drug in September, Onyx had hoped to win an accelerated review of carfilzomib based on mid-stage study data. Analysts at the time were skeptical and called the strategy risky. The drug is being tested for the treatment of multiple myeloma, a blood cancer. Onyx sought a speedy review because it's trying to prove that it has a more effective drug with fewer side effects than current therapies. For patients with the cancer, prognosis for survival is poor.

But the FDA told Onyx that it didn't have enough study data to speed up the review process. The agency set a July 27 date for deciding whether to approve the drug. Onyx execs said on a conference call Monday morning that they expect an advisory committee to review the drug and give a recommendation to the FDA next year. The agency hasn't announced any such review yet.

As for what the agency did tell Onyx, the company says it "outlined potential review issues including whether the application is sufficient to support an FDA conclusion that the data provided with [the application] meets accelerated approval criteria and whether the benefit and risk are appropriately balanced."

Farmer says he doesn't believe an approval will be granted until Onyx can provide some late-stage -- or phase III -- data, which won't be available until 2013.

The analyst still recommends buying the stock but lowered his price target to $43 from $48.

In late morning trading Monday, Onyx sank 5% to $38.79. The shares rose above $45 earlier this year and later traded down to almost $27.

Onyx is touting carfilzomib at a large doctors' meeting being held through Tuesday in San Diego. (See Five Biotech Stocks to Watch Going into Big Doctors' Meeting.) The company is hoping to build awareness among doctors and plans another investor call Tuesday morning.

Other analysts have said they expect Onyx's drug to be approved. But the carfilzomib delay may be seen as a positive for Celgene (CELG), which is developing its own next-generation multiple myeloma drug pomalidomide. Celgene also sells the blockbuster cancer drug Revlimid, also used to treat the disease.

Twitter: @brettchase

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