Eli Lilly and Incyte announced on Thursday that the FDA had granted Emergency Use Authorization (EUA) for the distribution and emergency use of baricitinib, its rheumatoid arthritis drug, in combination with Gilead’s remdesivir in hospitalized adult and pediatric patients aged two years or older with suspected or confirmed COVID-19 who require supplemental oxygen, invasive mechanical ventilation or extracorporeal membrane oxygenation (ECMO).
This development marks the first combination regimen to be authorized by the FDA.
David Ricks, Eli Lilly’s (LLY) chairman and CEO, said, “Since the start of the COVID-19 pandemic, Lilly has been committed to finding potential treatments to help people around the world who’ve been impacted by this virus.”
“Today’s FDA action for baricitinib marks the second Lilly therapy to be granted an EUA, in addition to the recent neutralizing antibody EUA for high-risk non-hospitalized patients, increasing the number of treatment options for COVID-19 patients at different stages of the disease. This is an important milestone for hospitalized patients on oxygen, as baricitinib may help speed their recovery,” Ricks added.
Data from the Adaptive COVID-19 Treatment Trial (ACTT-2), a randomized double-blind, placebo-controlled study to evaluate the efficacy and safety of baricitinib in combination with remdesivir versus placebo with remdesivir in hospitalized patients with or without oxygen requirements conducted by the National Institute of Allergy and Infectious Diseases (NIAID), served as the basis for the authorization.
In the trial, the combination reduced the time to recovery within 29 days after treatment began, versus patients that were given a placebo with remdesivir. NIAID and the study investigators are working to have the full analysis published in a peer-reviewed manuscript.
On Wall Street, the analyst community is bullish on LLY. 7 Buys and 3 Holds add up to a Moderate Buy analyst consensus. With shares up 9% so far this year, the $173 price target implies 21% upside potential. (See LLY stock analysis on TipRanks)
On November 16, Mizuho Securities analyst Vamil Divan reiterated a Hold rating as well as cut the price target from $164 to $156 (9% upside potential). “Eli Lilly continues to be viewed as a best-in-class story in large cap biopharma, with a relatively diverse new product growth story, limited patent expiry risk over the next decade, and opportunity for further margin expansion. However, the stock trades at a healthy premium to its peers, and management needs to continue to execute properly to maintain that premium,” he explained.
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