Piper Jaffray Comments On Benlysta Approval (HGSI)

The FDA has approved Human Genome Sciences Inc.'s (NASDAQ: HGSI) Benlysta for treatment of patients with active, autoAb-positive systemic lupus erythematosus (SLE) receiving standard therapy, without major restrictions or a black box warning and a limited REMS, Piper Jaffray reports.

“This combined with an annual price of $35K, in-line with our expectations, but above Street's $30K, supports peak WW sales of $3bn and our Overweight rating,” Piper Jaffray writes. “The key question remains what the launch will look like. We believe the broad label and reasonable pricing could engender widespread physician and patient enthusiasm, but ultimately, uptake will be dependent on appropriate formulary status and establishment of a permanent J code for Benlysta, which could take six months.

“In addition, a 2H11 approval in Europe is unlikely to contribute meaningfully to revenues until Benlysta gains widespread pricing authorization (mid-2012). We therefore recommend investors take profit until trajectory of launch is known.”

Human Genome Sciences closed Wednesday at $25.68.