Wells Fargo gives Protalix Biotherapeutics Inc. (AMEX:PLX; TASE: PLX) an "Outperform" recommendation, citing an executive order by US President Barack Obama to address drug shortages. Protalix's treatment for Gaucher's disease, which is under US Food and Drug Administration (FDA) review, is one of the diseases for which there a significant drug shortage. Wells Fargo's expects the share to continue to rise strongly up to and beyond approval of its treatment.
Cerezyme, made by Sanofi Aventis SA (NYSE: SNY; Euronext: SAN) and Genzyme Inc., is the leading treatment for Gaucher's disease on the market.
The executive order states, ''To the extent practicable, and consistent with its statutory responsibility to ensure the safety and effectiveness of the drug supply, the FDA shall take steps to expand its current efforts to expedite its regulatory reviews, including reviews of new drug suppliers, manufacturing sites, and manufacturing changes, whenever it determines that expedited review would help to avoid or mitigate existing or potential drug shortages. In prioritizing and allocating its limited resources, the FDA should consider both the severity of the shortage and the importance of the affected drug to public health.''
Wells Fargo says that the Cerezyme shortage has not been able to be adequately addressed by the other manufacturer with a Gaucher enzyme on the market, Shire plc (LSE: SHP), which says that while demand for its treatment has increased sharply, it can only accommodate a limited number of additional patients until the company's Lexington facility is approved, which is due in early 2012.
Wells Fargo concludes, "We believe this executive order has positive implications for Protalix, in that it should further empower the FDA to act rapidly in situations such as the Gaucher enzyme shortage." The FDA could bring forward the approval date for the drug.
Protalix's share price fell 6% on the American Stock Exchange yesterday to $6.11, giving a market cap of $523 million, and fell 1.9% by mid-afternoon on the TASE today to NIS 21.91.
Published by Globes [online], Israel business news - www.globes-online.com - on November 1, 2011
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