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Mirati (MRTX) Down on Longer Review Period for Adagrasib NDA

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Shares of Mirati Therapeutics plunged 12.8% on Feb 16, despite the FDA acceptance of its new drug application for its lung cancer candidate, adagrasib. The decline is  reportedly due to a longer-than-expected review period. Investors were reportedly expecting a priority review for the NDA.

Mirati’s NDA is seeking approval for adagrasib as a treatment for patients with non-small cell lung cancer (“NSCLC”) with KRAS-G12C mutation in the second-line setting. The patients must have received at least one prior systemic therapy. The FDA has set a PDUFA date of Dec 14, 2022 for the adagrasib NDA.

However, investors were expecting the decision related to the potential approval for adagrasib earlier than December as the company is seeking accelerated approval for the NDA. The FDA is also being reviewing the NDA under the more efficient Real-Time Oncology Review (RTOR) pilot program of the FDA.

Moreover, a longer review period for adagrasib is likely to help its direct competitor, Amgen’s (AMGN - Free Report) Lumakras, to penetrate more and thus raise the competition.

Please note that Amgen’s Lumakras is also a KRAS inhibitor targeting G12C mutation like adagrasib. Amgen received accelerated approval for Lumakras as a second-line treatment for locally advanced or metastatic NSCLC from the FDA in May last year,. Amgen also gained approval for the drug in Europe last month. The drug has shown robust launch uptake since its approval, recording sales of $90 million in 2021.

Although Mirati management is expecting an early approval for adagrasib, the timeline remains uncertain, fueling investors’ skepticism about a stronger competition from a much larger company, Amgen.

Over the past year, Mirati’s stock price has declined 53.1% compared with the industry’s 39.2% fall.

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Please note that Mirati is also developing adagrasib in combination with Verastem Oncology’s (VSTM - Free Report) RAF/MEK inhibitor candidate, VS-6766, for treating KRAS-G12C mutant NSCLC. Mirati and Verastem will conduct a phase I/II study to evaluate the combination regimen jointly.

Mirati is also developing a combination of adagrasib and Merck’s (MRK - Free Report) Keytruda in a phase I/II study — KRYSTAL-1 — for first-line NSCLC.

Preliminary data from adagrasib plus Merck’s Keytruda cohort demonstrated that the combination achieved a 100% disease control rate, with all seven patients exhibiting tumor regression ranging from 37% to 92% as of Oct 21, 2021.

Mirati is also developing other combination regimens of adagrasib for treating lung cancer as well as other oncology indications, including colorectal cancer.

Several data readouts are expected in 2022 which could also be catalysts for Mirati stock.

Zacks Rank

Mirati currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


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