Bayer shares expected to hike following recommendation of Xarelto by FDA panel

FRANKFURT – Shares of Bayer AG (BAYN.XE) are expected to hike over 10% by Friday after an announcement that the company’s blood thinner Xarelto, developed in partnership with Johnson & Johnson (JNJ), has been recommended for approval by the U.S. Food and Drug Administration advisory panel.

Excluding one abstention, the panel voted 9-2 in favor of approving rivaroxaban (marketed as Xarelto) thereby dismissing concerns and queries raised by FDA reviewers earlier this week regarding the safety and efficacy of the drug.
The second half of 2011 looks promising for both Bayer and J&J, as they expect to obtain approvals from US as well as European regulatory agencies.

The drug is intended for use as a blood thinner, or an anti-clotting agent, in patients with atrial fibrillation who are at a risk of stroke. Physicians and industry analysts opine that that this new class of drugs has the potential to generate billions of dollars in sales, as a substitute to warfarin: the previously used blood thinner.
The FDA is expected to take a final decision in early November.

Presently, Xarelto has received US FDA approval as a short-term therapy to prevent venous thromboembolism (a certain kind of blood clots) in people undergoing knee- and hip-replacement surgery.

By 2017, the estimated market potential for blood thinners in stroke prevention is expected to be $14 billion.