Celgene's new triple-combo FDA nods shift Revlimid, Pomalyst into higher gear

Thanks to Revlimid, Pomalyst and Otezla, Celgene's $4.40 billion haul in the second quarter came ahead of analysts' expectations. (Celgene)

Celgene's second-quarter sales show what a couple of new FDA approvals can do.

New triple-combo green lights for myeloma drugs Revlimid and Pomalyst helped drive Celgene's 15% increase in second-quarter revenue, to $4.40 billion. And with another Revlimid combo nod on tap, the aging superstar could continue delivering the gains for Bristol-Myers Squibb when the two companies wrap up their merger later this year.

Celgene’s stalwart Revlimid jumped 11%, reaching $2.73 billion, thanks to the adoption of use in tandem with Takeda’s Velcade and dexamethasone in previously untreated multiple myeloma patients. And Pomalyst, sold as Imnovid in Europe, delivered $619 million to Celgene’s Q2 topline after growing sales by 22%, driven by its own Velcade-dexamethasone nod in the second line.

The drugs saw smaller increases in Europe compared with the U.S., though, partly because the triplet green lights only came through the European Commission mid-May—and perhaps to a lesser extent, the arrival of a generic Alvogen launched recently in some small markets.

Meanwhile, Revlimid is up for some additional sales. The Celgene drug and Roche’s Rituxan recently won FDA approval for previously treated follicular or marginal zone lymphomas, offering those patients a chemo-free option. The pair showed they could stave off tumor progression for a median of 39.4 months, versus 14.1 months Rituxan and placebo. That kind of number led to SVB Leerink’s projection of an additional $600 million in Revlimid annual haul.

However, in an asset that BMS will reluctantly let go, Otezla racked up $493 million in the second quarter. The whopping 31% year-over-year rate once again showed the pain BMS is taking to win U.S. antitrust clearance for the $74 billion megamerger. The drug also recently added an FDA nod in oral ulcers associated with the rare Behçet’s Disease, and it also awaits a label update in scalp psoriasis.

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On track to about $1.9 billion in 2019 sales, per Celgene’s guidance, Otezla’s potential bodes well for the divestment process. Several groups of analysts have given the fast-growing drug a price of around $8 billion to $10 billion, depending on the fierceness of the bidding, while Bernstein analyst Ronny Gal arrived at $5.4 billion due to potential patent dispute.

Among all the potential buyers, RBC Capital analysts Brian Abrahams and Gregory Renza figured Gilead Sciences should buy the drug, given that it could use Otezla’s existing commercial infrastructure for the expected launch of its oral JAK inhibitor filgotinib as it moves closer to an FDA filing in rheumatoid arthritis.

Overall, Celgene now expects its 2019 total revenue could reach $17.2 billion to $17.4 billion, up $200 million on both ends, due to a sunnier outlook for Pomalyst and Abraxane. As for the takeover, the two parties currently expect to close it at the end of 2019 or the beginning of 2020.