Shares in Telix Pharmaceuticals Ltd (ASX: TLX) were trading more than 5% higher on Monday after the company secured a key approval from the US Food and Drug Administration.
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New drug gets the regulator's tick
The company said in a statement to the ASX that the FDA had approved its new drug application for Pixclara, an amino acid positron emission tomography (PET) drug for imaging gliomas (brain cancer).
Telix shares traded as high as $17.65 before settling back to be 5.4% higher at $16.52.
RBC Capital Markets said it was positive for the company. The broker has a $19 price target on Telix shares.
The broker said:
Telix has announced the FDA has approved Pixclara, the company's imaging agent for use in characterising recurrent or progressive brain cancer (glioma). Pixclara is the first FDA-approved targeted amino acid PET imaging agent for glioma in the United States. Importantly, this demonstrates the company's ability to overcome the initial setback from the Complete Response Letter and sets the foundation for the company's complementary prospective therapeutic asset, TLX-101-Tx, as well as further indication expansion within brain metastases.
RBC estimated the total addressable market for Pixclara's current use to be US$140 to US$160 million per year.
The broker added:
Assuming a penetration rate of ~60% in FY35, we estimate Pixclara's first indication would be valued at $0.56/share with further upside potential of $0.62/share if Pixclara achieves ~80% penetration. If the company is successful in securing approval to expand Pixclara's indication to include brain metastases, we estimate this could potentially add as much as ~$3.85/share to our price target.
Large unmet need
Telix said gliomas were the most common form of central nervous system cancer, accounting for approximately 30% of all brain and central nervous system tumours and 80% of all malignant brain tumours.
The company said about 24,000 new glioma cases were diagnosed each year in the US.
Telix Precision Medicine Chief Executive Officer Kevin Richardson said:
FDA approval of Pixclara will enable broad access in the U.S. to FET-PET imaging, which is already recognized in international clinical practice guidelines. As the first FDA-approved PET imaging drug for glioma, Pixclara will provide physicians in the U.S. with more certainty in their diagnoses and greater confidence in their treatment planning for patients.
Pixclara is a small molecule targeting compound that is labelled with a diagnostic radioisotope, fluorine-18.
After administration into the bloodstream, Pixclara targets membrane transport proteins known as L-type amino acid transporters 1 and 2.
Once bound, energy emissions from the radioisotope can be detected by a PET scanner.
Telix is valued at $5.32 billion.
