FDA Delay of Prevnar 13 Could Be Trouble for Pfizer

Pfizer (PFE) announced that the US Food and Drug Administration (FDA) is yet to complete its review of the Biologics License Application (BLA) for Prevnar 13, its 13-valent pneumococcal conjugate vaccine, thereby pushing its approval beyond the prescription drug user fee (PDUFA) action date of December 30, 2009. Following the delay, Pfizer shares lost 1.68% to close at $18.19.

Prevnar 13 is meant for the prevention of invasive pneumococcal disease (sepsis, meningitis, bacteremia, bacteremic pneumonia, and empyema), pneumonia, and acute otitis media caused by 13 types of streptococcus pneumoniae in infants and children of 6 weeks - 5 years of age. Although the vaccine has been approved in several countries, its approval in the US is quite crucial. The review is based on data from 13 phase III studies carried out on more than 7,000 children.

The approval of Prevnar 13 has been getting delayed over the last few months. While the original PDUFA date was September 2009, in August, it was pushed back by another three months. However, based on encouraging data from the studies, Pfizer is confident of gaining approval in due course.

Prevnar 13 is a new version of the currently available pneumococcal vaccine. Prevnar is one of the best selling vaccines worldwide with sales of about $2.7 billion in 2008. While Prevnar treats illness caused by 7 strains of pneumococcal bacteria, the new vaccine is expected to block 13 strains including the original 7. It is estimated that Prevnar 13 would cover 92% of invasive pneumococcal disease, compared to 81% covered by Prevnar. The company is currently seeking approval for Prevnar 13 in about 60 countries spanning six continents and has already been approved in four countries.

We believe approval of the new Prevnar is quite crucial for Pfizer as its highest selling drug Lipitor is slated to lose patent exclusivity in a few years. Prevnar was one of the major products that Pfizer obtained from its $67 billion acquisition of Wyeth, which enabled it to diversify into vaccines and biotechnology medicines.