Vertex Pharmaceuticals' alternative to opioids in pain treatment is "not a game-changer," an analyst said Tuesday on the company's Phase 3 test results. After skidding in early trades, VRTX stock rallied at the close.
The company pitted its pain treatment against a placebo and an opioid in patients following an abdominoplasty or a bunionectomy — also known as a tummy tuck or bunion removal, respectively. But the results only confirmed the modest effect from Vertex's drug, RBC Capital Markets analyst Brian Abrahams said in a report to clients.
Among tummy tuck patients, Vertex's drug — dubbed VX-548 — proved it wasn't inferior to opioids, he said. But in bunionectomy patients, the non-opioid medicine appeared inferior to opioids.
"We see 548 in acute pain as a niche player and not a game-changer," Abrahams said.
On the stock market today, VRTX stock climbed 2.4% to close at 446.08.
VRTX Stock: Abdominoplasty Results Show Promise
Researchers measured the difference in pain scores from prior to treatment to 48 hours following receipt of VX,548, an opioid or a placebo.
In the abdominoplasty study, patients who received VX-548 reported a statistically significant improvement in pain vs. placebo recipients. The pain drug also proved it isn't inferior to opioids. But the results among bunionectomy patients were more moderate. Vertex's pain drug had a statistically significant effect on pain when compared with a placebo, but was inferior when pitted against opioids.
Further, it took longer for VX-548 to have an effect on pain in patients who had a bunion removed than it did in patients following a tummy tuck.
"While VX-548 failed to demonstrate comparable (effectiveness) to the active, opioid control in bunionectomy, we remain enthusiastic for the prospects of the company's pain program given the company's vision for serial innovation," Leerink Partners analyst David Risinger said in a report.
He has an outperform rating on VRTX stock.
Chronic Pain Is The Bigger Opportunity
Notably, Vertex says its pain treatment was generally well tolerated in all of its studies. There were more side effects among placebo recipients in the abdominoplasty and bunionectomy studies than there were among VX-548 recipients.
Side effects included nausea, headache, constipation, dizziness and low blood pressure.
Next, Vertex plans to ask the Food and Drug Administration to approve VX-548 in mid-2024.
RBC's Abrahams estimates Vertex's drug could nab $300 million to $400 million a year in treating patients following surgery. The far bigger opportunity is in chronic pain, which is worth more than $2.5 billion annually, he said.
Importantly, Vertex also ran a 14-day open-label study, meaning patients knew they were receiving VX-548. There were no apparent side-effect red flags in that test, which should provide VRTX stock investors with some reassurance.
"However, the safety bar in chronic pain remains high and longer dosing in those studies will still be key for eliciting VX-548's overall benefit/risk," he said.
Abrahams kept his sector perform rating and 397 price target on VRTX stock.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
