On Thursday, the FDA approved Elanco Animal Health Incorporated's (NYSE:ELAN) Zenrelia, a once-daily oral JAK inhibitor for the control of pruritus (itching) associated with allergic dermatitis and atopic dermatitis in dogs at least 12 months of age.
Approximately 17 million dogs suffer from allergic skin disease, including atopic dermatitis, food allergies, or flea sensitivity.
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Elanco conducted a head-to-head noninferiority study comparing the efficacy and safety of Zenrelia and Apoquel for submission in the European Union.
A study of 338 client-owned dogs with confirmed atopic dermatitis was conducted.
The study shows one daily dose of Zenrelia is at least as effective as the market incumbent JAK inhibitor at the primary endpoint on Day 28.
- Zenrelia provided consistently greater relief from itch and skin lesions over time, with once-daily dosing from the start, while rebound itch was observed in Zoetis Inc's (NYSE:ZTS) Apoquel (oclacitinib)-treated dogs after dosing decreased to once daily after Day 14.
- 77% of Zenrelia-treated dogs achieved clinical remission of itch, compared to 53% of Apoquel-treated dogs.
William Blair highlights that Zenrelia's label includes a warning advising discontinuation 28 days to 3 months before any vaccination. This raises concerns about whether veterinarians will readily adopt the new skin product, given the extra precautions needed, especially considering some dogs receive vaccines as frequently as once a year.
In reviewing the clinical data, it was noted that the placebo effect in Zenrelia's FDA study was significantly higher than in Apoquel's, suggesting that Apoquel's actual impact on atopic dermatitis may be more robust than Zenrelia's.
This raises doubts about Zenrelia's true efficacy in comparison. Additionally, William points out that adverse events, such as diarrhea and vomiting, occurred at twice the rate in Zenrelia's FDA study than in Apoquel's.
The analyst notes that investor expectations for Zenrelia over the next two years are already elevated. However, due to lingering uncertainties, William prefers to wait for concrete execution before assessing if it can sustainably impact the P&L statement. The analyst maintained the Market Perform rating.
Price Action: ELAN stock traded lower by 4.18% at $14.44 at the last check Friday.
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