Positive news flowed in for Regeneron Pharmaceuticals, Inc. REGN when the FDA approved a label expansion of Eylea.

Eylea’s label was expanded by the FDA to include the treatment of diabetic retinopathy in patients suffering from diabetic macular edema (DME).

We note that the FDA granted breakthrough therapy designation and priority review to Eylea for the same in 2014.

This was the fourth indication approval for Eylea. We remind investors Eylea is already approved in the U.S. for the treatment of wet age-related macular degeneration (AMD), macular edema following retinal vein occlusion (RVO) and DME.

Last month, the European Commission approved Eylea for the treatment of visual impairment due to macular edema secondary to RVO. Eylea is also approved in the EU and other markets for use in wet AMD and DME.

Total sales of Eylea increased 48% to $2.8 billion in 2014 compared to 2013 (consisting of $1.7 billion in the U.S. and $1.0 billion in rest of world). The latest label expansion of the drug should further boost its sales.

We note that Regeneron co-developed Eylea with the HealthCare unit of Bayer AG BAYRY. Regeneron is solely responsible for U.S. sales of the eye drug and is entitled to the entire share of profits made in the country, while Bayer is responsible for sales internationally.

Regeneron and Bayer have agreed to equally share the profits (or losses) from ex-U.S. Eylea sales, except for Japan, where Regeneron receives a royalty on net sales.

Regeneron carries a Zacks Rank #4 (Sell). Some favorably-placed stocks in the health care sector include ANI Pharmaceuticals, Inc. ANIP and Horizon Pharma plc HZNP. Both carry a Zacks Rank #1 (Strong Buy).

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