BioMarin: Latest Regulatory Advancements A Home Run Opportunity

BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) is a great long-term biotech to own. It is already producing revenues with several regulatory approved drugs, but I believe that traders/investors can capitalize with an upcoming catalyst. This involves the PDUFA date established for ROCTAVIAN (valoctocogene roxaparvovec AAV gene therapy) for the treatment of adult patients with severe Hemophilia A, which is set for March 31, 2023.

The reason why I believe this is a good catalyst to look forward to is because of several events that have already transpired. The biggest event of all is that the FDA is no longer planning to hold an advisory committee to review this gene therapy. While this does not guarantee FDA approval of ROCTAVIAN for Hemophilia A, it does remove one hurdle. Previously, the FDA was going to require an Advisory Committee to review this gene therapy for the treatment of this patient population. With this adcom no longer being needed, I believe it removes a great deal of risk. All that remains now is the inspection of BioMarin’s gene therapy manufacturing facility being in good order. Hopefully the FDA does end up approving ROCTAVIAN, but even if it doesn’t, the company has already received European approval for it.

If that wasn’t enough, BioMarin Pharmaceutical Inc. also has the potential to expand the use of VOXZOGO, which has been approved to treat children with achondroplasia. Supplemental regulatory applications have been submitted and in the 2nd half of 2023, BioMarin should receive notice about them at that time.

ROCTAVIAN Approval Is Not Guaranteed, But Expected Based On Latest Data

As I stated in the beginning above, BioMarin Pharmaceutical Inc. is in the process of having its regulatory application of ROCTAVIAN, for the treatment of adults with severe Hemophilia, under review. Hemophilia A is a rare bleeding disorder that is caused by a deficiency of a functional plasma known as clotting factor VIII. Without this protein in place, patients tend to bleed often with no cause. The main form of treatment is patients getting infusion treatments, which must be done on a routine basis. That’s because these patients need to keep enough Factor VIII to keep bleeding episodes/symptoms to a minimum. The PDUFA date of ROCTAVIAN was established for March 31, 2023. I believe that Hemophilia A approval in the United States would be another great step for this biotech in creating value for its shareholders.

The real question is whether or not it will ultimately receive FDA approval for the use of ROCTAVIAN? There is no guarantee of such approval, but there are some positives developments which have occurred, which lead me to believe that there is a good chance of it happening. The biggest reason of all, which I noted in the intro, is that the FDA decided that an advisory committee (adcom) would no longer be necessary. This is huge, because initially the FDA did state that an adcom would be required if BioMarin Pharmaceutical Inc. wanted to obtain marketing approval in the United States of ROCTAVIAN for the treatment of adults with Hemophilia A.

One important item to note is that even though the FDA is no longer requiring an adcom, it doesn’t guarantee that the biotech will receive regulatory approval for this gene therapy in the United States for the treatment of this patient population. Another important item, which the FDA wanted to see in order to approve this treatment, was 3-year follow up data from the ongoing global phase 3 GENEr8-1 study. This late-stage study used ROCTAVIAN as a one-time gene therapy treatment for adults with Hemophilia A.

The clinical evidence established to date is quite compelling. The main bullet points to note from the 3-year follow up study are as follows:

• Mean (average) annualized bleed rate reduced by as much as 80%
• The need for Factor VIII therapy reduced by 94%
• About 92% of patients were off prophylaxis therapy by the end of year 3.

The first bullet point is the most important, because the main goal of a therapy, or gene therapy in this case, is to reduce the bleed rate for these Hemophilia patients as much as possible. The ability to reduce the annualized bleed rate (ABR) by as much as 80% is a huge quality of life improvement. Then, an argument can be made that reducing the need for patients to receive infused Factor VIII therapy by 94% is another important quality of life improvement as well. With respect to the last bullet point, it is what a gene therapy is supposed to be designed for, which is a “one and done” type of a treatment. While 92% of patients being off of prophylaxis therapy by the end of year 3 is not perfect, it is still a huge accomplishment. It would have been nice to have seen 100% of patients being off of prophylaxis, but I still believe that the FDA will view this data in good light regardless.

Not only did BioMarin Pharmaceutical Inc. accomplish such impressive clinical data, it did so in the largest and longest global phase 3 study to date for any gene therapy in Hemophilia. It recruited a total of 134 patients with Hemophilia A into this study. On the safety front, I believe it all looks good with respect to this to. Of course, it is not perfect at all though. Patients given a single 6e13 vg/kg dose of ROCTAVIAN had some side effects such as nausea, headache, fatigue, alanine aminotransferase (ALT) elevation and aspartate aminotransferase (AST) elevation. I think that the most important takeaway from the safety portion of the study would be that after 3-years of treatment no serious adverse events or Grade 3 events were noted.

One important thing to note is that the PDUFA date of March 31, 2023 might be extended. That’s because this new 3-year data must be submitted to the FDA as part of the Biologics Licensing Application (BLA) package in order for FDA approval to be given. As such, if the FDA believes that the review period to look at all this data requires additional time, then it may extend the PDUFA by several months. Hopefully, BioMarin Pharmaceutical Inc. will receive FDA approval of ROCTAVIAN for the treatment of adults with Hemophilia A eventually.

However, even if it doesn’t, BioMarin Pharmaceutical Inc. has already received conditional marketing authorization of ROCTAVIAN for this patient population. Not only did it receive such approval from the European Commission (EC), but it did so with Orphan Drug Designation. I believe that one of the most crucial benefits to make note of would be the 10 years of market exclusivity in Europe it will now have with ROCTAVIAN because of this designation.

VOXZOGO Supplemental Regulatory Applications Could Expand Patient Population

Besides the ability for BioMarin Pharmaceutical Inc. to receive FDA approval of ROCTAVIAN for the treatment of patients with severe Hemophilia A, there are a few other catalysts for investors to look forward to. These catalysts deal with the potential to receive expanded regulatory approvals of VOXZOGO for achondroplasia. This prescription medicine was approved in several territories across the globe, such as: United States, Australia, Brazil and Europe. The supplemental application submission in Europe for VOXZOGO is for the treatment of children with achondroplasia under the age of 2. The supplemental regulatory application in the United States for VOXZOGO is for the treatment of children with achondroplasia under the age of 5. Additional decisions by health authorities for both of these supplemental regulatory applications are expected in the 2nd half of 2023.

Financials

According to the 10-Q SEC Filing, BioMarin Pharmaceutical Inc. had cash, cash equivalents, short-term investments and long-term investments of $1.64 billion as of September 30, 2022. This pharmaceutical company is already in great shape compared to most other pharmaceutical companies, because it has already received regulatory approvals for several clinical products from its pipeline. Several of the products, for which it has received regulatory approvals for, are as follows: VIMZIM, NAGLAZYME, PALYNZIQ, KUVAN, VOXZOGO, BRINEURA and ALDURAZYME. Speaking of VOXZOGO, the company is already doing pretty well in terms of commercial sales for it. In Q3 of 2022, the drug generated $48.3 million in sales. Not only that, but the total revenues for Q3 of 2022 were also good as well, which ended up being $505.3 million. This was a huge increase in revenue of 24% year over year. This growth is quite impressive, because this was in the face of shrinking revenue in the United States for KUVAN.

The thing is that KUVAN is facing generic competition pressure constantly, thus it is continuing to see a decline. Still, I believe that the supplemental regulatory applications noted above hold the potential to increase the patient population that it could go after. If these are granted, then BioMarin Pharmaceutical Inc. has potential to increase its revenue of VOXZOGO in the coming years. In terms of cash, it does have a good amount on hand, but it may still need to find a way to raise more mid-year. That’s because in the 10-Q SEC Filing, it states that it only has enough cash to fund its operations for at least the next 12 months.

Risks To Business

There are several risks that traders/investors should be aware of before investing in BioMarin Pharmaceutical Inc. The first risk to consider would be with respect to the Biologics Licensing Application (BLA) review of ROCTAVIAN, which is being reviewed for potential U.S. marketing approval for the treatment of adults with severe Hemophilia A. The PDUFA date has been established for March 31, 2023, and there is no guarantee that the company will receive regulatory approval of this gene therapy for the treatment of this patient population.

In addition, there is another possible risk to consider with respect to this PDUFA. As I noted above, it’s quite possible that the FDA may need additional time to review the BLA application. Why? Well, that’s because the 3-year data required for such an FDA approval was just submitted. Having said that, the PDUFA date might be extended by several months.

A second risk to consider would be with respect to the supplemental regulatory applications submitted of VOXZOGO for the treatment of patients with achondroplasia. While I believe such approvals should happen based on the drug already being approved for this specific patient population, there is no guarantee of them happening. The final risk to consider would be with respect to the ongoing financial position that BioMarin Pharmaceutical Inc. is dealing with. It does have a significant amount of cash on hand, but still it believes that it only has enough cash to fund its operations for at least the next 12 months. This means, it will likely have to find a way to raise cash by at least mid-2023.

If I had to guess when BioMarin Pharmaceutical Inc. would raise cash, then I believe it would do so after a positive news event. For example, if the company does receive FDA approval of ROCTAVIAN for severe Hemophilia A, then I believe it may choose to raise cash right away after such an event.

Conclusion

The final conclusion is that BioMarin Pharmaceutical Inc. is a great long-term biotech to own. The reason why I state that is because it is already generating revenues from multiple regulatory approved products from its pipeline. It is also doing a pretty good job at growing revenues, especially with the latest growth of revenues in Q3 of 2023 of $505.3 million, which was a year over year increase of 24%. This company is already off to a good start with VOXZOGO, which contributed $48.3 million in net product revenues in Q3 of 2023.

The supplemental regulatory applications expected to be considered by the health regulatory authorities in the 2nd half of 2023 only serve to help BioMarin Pharmaceutical Inc. possibly generate even more revenues in the coming years. Lastly, the upcoming PDUFA date of ROCTAVIAN for the treatment of adults with severe Hemophilia A is going to be a major catalyst.

I believe that should BioMarin Pharmaceutical Inc. receive FDA approval of ROCTAVIAN for this patient population, then it will be a huge win shareholders. I also believe it will be a huge contributing factor in raising the BioMarin Pharmaceutical Inc. stock price as well.