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Roche (RHHBY) Gets FDA Approval for Cobas EFGR Mutation Test

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Roche (RHHBY - Free Report) announced that the FDA approved its cobas EGFR Mutation Test v2 as a companion diagnostic test (CDx) with IRESSA.

A CDx test provides information, which is necessary for the safe and effective use of a corresponding therapeutic product.

Moreover, results for EGFR mutations can be available in less than one day with the cobas EGFR Mutation Test v2, which, in turn, helps to determine if patients can benefit from IRESSA.

We note that this approval for cobas EGFR Mutation Test v2 as companion diagnostic, follows previous approvals with Tarceva and Tagrisso (osimertinib).

The test is expected to support IRESSA as an additional therapeutic option for patients.

We remind investors that the cobas EGFR Mutation Test v2 is currently the only FDA-approved diagnostic test for NSCLC using liquid biopsy. EGFR testing in plasma provides non-invasive option by drawing blood samples, specifically for patients who are not eligible for a tissue biopsy.

Data from clinical studies have shown that patients diagnosed with NSCLC positive for defined mutations of the EGFR gene benefit from tyrosine kinase inhibitor (TKI) therapies.

We note that apart from providing therapeutic products and services for diverse medical needs, Roche also focuses on innovative diagnostic solutions for the early detection and treatment of diseases. Immunodiagnostics is the key focus area for this segment.

The Diagnostics division generated sales of CHF 6.3 billion in the first half of 2018, up 8% from the year-ago period.

Approval of new drugs and diagnostics tests, and label expansion of existing key drugs bode well for Roche, given its current challenges.

Year to date, shares of Roche have declined 0.3% against the industry’s growth of 7.8%. Roche’s legacy drugs like Herceptin and MabThera are facing competition from biosimilars. Novartis (NVS - Free Report) has already launched its biosimilar version of Rituxan/ MabThera in Europe. Amgen (AMGN - Free Report) too has got its biosimilar of Avastin.

Zacks Rank and Stock to Consider

Roche currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the pharma/biotech sector is Gilead Sciences, Inc. (GILD - Free Report) , which sports a Zacks Rank #1 (Strong Buy) as well.  You can see the complete list of today’s Zacks #1 Rank stocks here.

Gilead’s earnings per share estimates have increased from $6.10 to $6.57 for 2018 in the last 60 days. Estimates for 2019 are also up by 14 cents.

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