Bristol/J&J and Bayer Report Solid Safety Data on Cardiac Drugs but Need Phase 3 Efficacy Data

Phase 2 data on new cardiovascular drugs (milvexian by Bristol and J&J, and asundexian by Bayer) showed solid safety data, but limited efficacy data. Based on the mixed data, we are not making any major changes to our fair value estimates for these firms, as we feel more phase 3 data is needed before making large changes in our projections for the drugs. With the firms signaling encouraging data earlier, the lack of clear efficacy could be viewed as a disappointment, but we continue to view close to a 50% probability of approval for the drugs. Both drugs are moving into phase 3 development for atrial fibrillation, or AF, and stroke prevention (and acute coronary syndrome for milvexian). The innovation supports the firms’ wide moats by enabling potential drug launches with peak annual sales of well over $5 billion (for each drug) around the time when generics will launch on current leading cardiovascular drugs from Bristol (Eliquis) and Bayer/J&J (Xarelto).