Pipeline updates are highly awaited events in the pharma/biotech sector as they play an important role in deciding whether or not to invest in a particular company. These updates provide information on experimental drugs and at times give an insight into the commercial potential of the candidate once it is successfully developed and commercialized.

Shire plc (SHPG) recently announced that the FDA has accepted its supplemental New Drug Application (sNDA) for Vyvanse with priority review for the indication of binge eating disorder in adults.

The anticipated Prescription Drug User Fee Act action date is in Feb 2015. We note that Vyvanse is already approved for the treatment of attention-deficit/hyperactivity disorder (ADHD).

The sNDA was based on encouraging results from two identically designed, randomized, placebo-controlled phase III studies which evaluated the efficacy and safety of Vyvanse versus placebo.

Results from the study showed that Vyvanse was statistically superior to placebo on the primary efficacy analysis while maintaining a safety profile.

The label expansion of Vyvanse is expected to boost its sales further. In Jun 2014, Shire agreed to conduct pediatric clinical studies following the FDA’s request to investigate the potential use of the drug for the treatment of ADHD in children aged 4 to 5 years.

Meanwhile, Shire has finally agreed to AbbVie’s (ABBV) acquisition proposal in Jul 2014. Under the terms of the offer, shareholders of Shire will receive £53.19 for per Shire share (£24.44 in cash and 0.8960 ordinary shares of the merged company for each Shire share held).

Shire currently carries a Zacks Rank #2 (Buy). Investors looking for better-ranked stocks in the broader health care sector may consider Allergan (AGN) and Gilead Sciences (GILD), both carrying a Zacks Rank #1 (Strong Buy).

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