Johnson & Johnson Announces Progress on Cancer Drug
On Thursday, shares of Johnson & Johnson (NYSE:JNJ) popped nearly 1 percent after saying its prostate cancer pill Zytiga delayed the progression of cancer in patients who had not previously undergone chemotherapy. Patients who were treated with Zytiga and a steroid had a longer time to death or disease progression than patients treated with a placebo and the steroid.
Zytiga works by cutting production of testosterone, a hormone that can aid cancer cell growth. Johnson & Johnson tested the new drug in a trial of almost 1,100 men with prostate cancer, comparing it with prednisone and a placebo. Although the company did not release specific survival data, spokeswoman Kellie McLaughlin said the difference was statistically significant, while the difference in overall survival constituted a “strong trend.” Johnson & Johnson plans to file for a broader marketing approval of Zytiga in the United States and other markets in the second half of this year.
After the news, shares of Medivation, Inc. (NASDAQ:MDVN) surged more than 14 percent. The San Francisco company has developed a similar prostate cancer drug with Astellas Pharma Inc. called MDV3100. However, Dendreon Corp. (NASDAQ:DNDN) shares fell almost 7 percent on Thursday. The company makes the prostate cancer drug Provenge, which was approved in April 2010. ISI Group analyst Mark Schoenebaum explained the early Zytiga results raise the possibility that doctors will try Zytiga instead of Provenge, causing lower Provenge sales in the future than previously estimated.
According to Larry Beigelsen, an analyst at Wells Fargo (NYSE:WFC), his current estimate of $914 million in Zytiga sales for next year could be on the conservative end after the positive news. Johnson & Johnson shares are down about 1 percent year-to-date, but have gained 28 percent over the past three years and currently pay a dividend north of 3 percent.
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