AstraZeneca PLC (LSE:AZN, NASDAQ:AZN) has reported mixed phase three trial data for efzimfotase alfa, its treatment for hypophosphatasia, a rare genetic disease that impairs the body's ability to mineralise bones and teeth.
Results from the paediatric trials, known as MULBERRY and CHESTNUT, were positive, but the HICKORY trial in adults and adolescents produced a more complicated picture.
The adult portion of HICKORY missed its primary endpoint, a six-minute walk test designed to measure functional mobility, after an unusually strong placebo response in patients with adult-onset disease muddied the results.
However, the drug showed nominally significant and clinically meaningful improvements on the same measure when looking at adolescents and patients with paediatric-onset disease who had progressed into adulthood.
Citi analyst Andrew Baum maintained a buy rating and left forecasts unchanged pending the release of detailed data, but argued the results were consistent with the bank's risk-adjusted peak sales estimate of $2.6 billion.
That figure already stands well above the consensus of $1.8 billion, and Citi said its unadjusted peak sales forecast of $4.4 billion remains achievable.
Two factors underpin the bullish case.
The first is the potential for efzimfotase alfa to take market share beyond AstraZeneca's existing hypophosphatasia treatment Strensiq, given its easier dosing, lower manufacturing costs, and a broader European label that extends to bone manifestations beyond hypophosphatasia.
The second is the possibility of securing a label covering adolescents and paediatric-onset adults based on the subgroup data from HICKORY, with Citi noting that regulators have historically shown flexibility on nominally significant secondary endpoint results in rare disease settings.
Hypophosphatasia is caused by mutations in a gene responsible for an enzyme called tissue-nonspecific alkaline phosphatase, and can range from mild bone fragility to life-threatening skeletal deformity in infants.