ChemoCentryx, Inc. (NASDAQ: CCXI) is headed up in the premarket hours this morning after announcing that it has received regulatory approval to market TAVNEOS in Europe. Here’s the scoop:
CCXI Stock Gains On Regulatory Approval
As mentioned above, ChemoCentryx announced this morning that its TAVNEOS product has been approved for use in the European Union. The drug has been approved in combination with a rituximab or cyclophosphamide regimen for the treatment of adult patients with severe, active granulomatosis polyangiitis (GPA) or microscopic polyangiitis (MPA). These two conditions represent the two main forms of ANCA-associated vasculitis.
Europe isn’t the only region where the drug is approved either.
Recently, the company announced approval by the United States Food and Drug Administration (FDA) for the same indications.
CCXI went on to explain that it will receive marketing authorization in all member states of the European Union, as well as in Iceland, Liechtenstein, and Norway.
The approval was the result of an alliance with Vifor Pharma. As part of this alliance, ChemoCentryx will retain all rights for TAVNEOS for orphan and renal diseases in the United States and Vifor Pharma has rights to commercialize avacopan in the rest of the world. Moreover, CCXI will receive royalties in the teens to mid-20s percent on potential ex-US sales.
Management Commentary
In a statement, Thomas J. Schall, Ph.D., President and CEO at CCXI, had the following to offer:
“European Union approval of TAVNEOS represents the third major global sector to recognize the value of this long-awaited new treatment for the debilitating and often deadly disease of ANCA-associated vasculitis. We congratulate our alliance partner, Vifor Pharma, for this significant achievement as we welcome the opportunity for our alliance to serve ANCA patients.”
The above statement was followed up by Professor David Jayne, Professor of Clinical Autoimmunity at the University of Cambridge. Here’s what he had to say:
“This is a significant step forward for patients in Europe living with this systemic condition. They will now have available a new class of medication that meets major unmet medical needs in the treatment of ANCA-associated vasculitis.”
The Bottom Line
The approval announced this morning is big news. Ultimately, the company will receive large royalties on sales outside of the United States, meaning that the approval opens the door to a strong revenue stream. All in all, investors have a very good reason to be excited about CCXI stock this morning.