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Regeneron a ‘national strategic asset’ for quick response to COVID-19 outbreak: analyst

March 13, 2020 Kyle Blankenship

Drugmakers of all shapes and sizes are chasing after therapeutics and vaccines to fight the novel coronavirus. But among the pack, one company’s track record might give it the jump on a treatment—and at least one analyst is not afraid to heap praise on its efforts. 

Regeneron’s “innovative horsepower and initiative” in its response to COVID-19, including a push to repurpose arthritis med Kevzara and quickly identify new antibodies to target the virus, has put the drugmaker in the lead to develop a treatment, Evercore ISI analyst Josh Schimmer said in a note to investors Friday.

After a luncheon with CEO Len Schleifer, Schimmer touted Regeneron’s response not only to COVID-19 but also Ebola as a “national strategic asset” for the U.S. given the drugmaker’s quick mobilization in outbreaks.

“Our most important takeaway is that the COVID pandemic is a lesson of how lucky the country is to have (Regeneron)––it is poised to perhaps have the biggest impact on this outbreak,” Schimmer wrote. 

Earlier this week, Sanofi and Regeneron announced they were preparing studies to test Kevzara in patients who have contracted COVID-19, a Regeneron spokesman said.

Kevzara, approved in 2017, might hold promise in helping patients’ immune systems stop attacking healthy cells, Sanofi’s global head of development for immunology and inflammation Naimish Patel told The Wall Street Journal. The move comes after a rival drug, Roche’s Actemra, notched a recommendation from China’s National Health Commission for patients with serious lung damage earlier this month. 

Roche’s Genentech is weighing studies of the drug in COVID-19 patients, a spokesperson told the WSJ. 

Schimmer noted two “encouraging case reports” of Kevzara’s use on COVID-19 patients in Italy and said clinical trials could lead to an approved indication in severe patients that could eventually expand to a larger approval in acute respiratory distress syndrome. Regeneron might also find success with an antibody therapy, potentially finding a use as prophylaxis in first responders and healthcare workers on its own or as a combo with Kevzara, Schimmer wrote. 

Regeneron hopes a COVID-19 therapeutic could be ready for human dosing by late summer, J.P. Morgan analyst Cory Kasimov wrote in a note to investors Tuesday. 

RELATED: Coronavirus tracker: Gottlieb says postpone gatherings; travel clampdown forces Novartis to change Kymriah shipments

But COVID-19 might not be a net positive for Regeneron, at least on the financial side, if elderly patients stop venturing out for professional procedures––potentially harming blockbuster Eylea’s sales,  Piper analyst Christopher Raymond wrote in a Friday note. 

Eylea, an anti-VEGF administered by monthly shots to the eye, might be seriously hit by patients refusing to undergo elective procedures in light of the outbreak, Raymond noted, despite Regeneron’s lack of concern. 

“While (Regeneron) contends no impact has been seen to date, we think this is worth monitoring closely,” he wrote. 

Eylea crossed the $2 billion global sales mark in 2019 on an impressive 11% growth mark, Regeneron said. With eight years of experience on the market and 30 million doses administered, Regeneron said it still sees its drug as the “VEGF of choice” despite new competitors––including Novartis’ Beovu––hitting the market, Kasimov wrote. 

Regeneron’s hope could be well-founded as safety concern for Beovu have mounted. In February, the American Society of Retina Specialists sent out a safety update to doctors detailing 14 cases of retinal vasculitis for Beovu patients, 11 of which were occlusive retinal vasculitis that can lead to vision loss. The alert came early into the launch, so many of the patients had only had either their first or second injection.

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