Novartis Gets FDA Blessing to Turn “The Itch” Into a High Margin Cash Cow Machine…

And just like that, Novartis is going to become the most popular drug dealer at Coachella every year… 

Big news for you biotech casino members: Novartis just got the FDA’s blessing for Rhapsido… a twice-daily pill for chronic genital herpes hives (a.k.a. The kind of thing dermatologists used to wave off with “try Benadryl and stop scratching.” Now it’s a $4,521/month immunology play with a brand new FDA stamp and a billion-dollar runway. 

(Source: Giphy) 

In short, Novartis already had Xolair in the space (an injectable they co-sell with Roche). But Xolair never took off. Why? Well because doctors don’t love sticking people with needles for itchy welts, and the drug came with a black-box warning… though that never stopped Purdue Pharma from single-handedly ruining people's lives. But I digress.

(Source: Fierce Pharma) 

Rhapsido is an oral BTK inhibitor pitched as “the next step” after antihistamines fail. And the market is wide open. Roughly 1.7 million Americans deal with chronic hives, but Novartis is targeting the 400,000 who don’t respond to over-the-counter fixes. Of those, only ~20% are on existing therapies like Xolair or Sanofi’s Dupixent. That leaves hundreds of thousands of itchy, miserable, billable patients waiting to be converted into a high margin recurring revenue stream. Bigly. 

With that said, while Novartis is going after hives, it’s also currently pushing Rhapsido into food allergies, multiple sclerosis, and other autoimmune conditions. Management is eyeing multibillion-dollar peak sales because if there’s one thing pharma knows, it’s how to scale the hell out of an indication once you’ve cracked the FDA door open. The only catch is that Rhapsido will run patients (or insurers) north of $50K a year (Martin Shkreli is presumably punching air right now). 

(Source: Giphy) 

However, Novartis is betting payers will foot the bill rather than leave people clawing their arms off in the middle of the night. Plus, given the desperation of the market… people who’ve literally tried everything else… this has a great shot at working. Meaning, for investors, Novartis finally has a fresh growth lever as Cosentyx inches toward patent cliffs. Additionally, Sanofi/Regeneron’s Dupixent just got boxed into a corner… mainly because oral beats injectable in this market all day erryday.

So yeah. It’s not sexy. It’s not AI. It’s hives. But Novartis just turned it into one of the hottest cash cows in pharma. And shares proved it as Novartis is officially up 6.39% over the last five trading days. Until next time, friends…

At the time of publishing, Stocks.News does not hold positions in companies mentioned in the article.