In A Surprise Twist, AstraZeneca Wins Accelerated FDA Approval For Lynparza

In A Surprise Twist, AstraZeneca Wins Accelerated FDA Approval For Lynparza

Summary

    On Friday, AstraZeneca announced accelerated FDA approval for Lynparza. This comes a day after the EU approved Lynparza (olaparib).

    I reiterate my bull thesis on AstraZeneca. The company projects Lynparza to be a $2 billion-a-year seller, and the two approvals last week position the company to fulfill this projection.

    As expected, AstraZeneca continues to enhance its growth prospects as an independent pharmaceutical company. FDA approval for Lynparza corroborates this position.

In early June, I wrote a bullish article on AstraZeneca (NYSE:AZN), with a thesis stating that the company's extensive oncology pipeline, as well as its attractive buyout prospects in light of Pfizer's (NYSE:PFE) recent attempts to court AZN (which ultimately valued AZN at $120 billion) were compelling reasons to accumulate shares. However, I also factored in the underlying risk to an AZN investment, since, after all, the company is one of many to suffer from patent expirations and lackluster performance (see previous article for more details).

For AstraZeneca, these issues have continued to exacerbate top line pressure, prompting concern about its future prospects. But with the accelerated FDA approval for AZN's ovarian cancer drug, Lynparza (olaparib), there is more evidence to support my claim that the company can flourish independent of Pfizer. Thus, I reaffirm my bull thesis, since I'm confident that AZN should improve its long-term prospects with this landmark achievement.