Onyx Pharmaceuticals Inc.ONXX

Morningstar Rating

Stock Research and Analysis

by Lauren Migliore

Onyx Pharmaceuticals, with its promising small-molecule drug Nexavar, is an emerging player in the oncology arena. Continued launches overseas and a possible label expansion on the horizon are putting Onyx well on its way to gleaning blockbuster sales Read more

Bulls Say

In addition to rapid overseas expansion, Nexavar is being tested in more prevalent tumor types, including lung and breast cancer, thus heightening the drug's potential to achieve blockbuster status.

Onyx is capitalizing on its status having the first FDA-approved therapy for liver cancer, which is the third-leading cause of death from cancer. With no clear competitors, Onyx has first-mover advantage in reaching patients with this difficult-to-treat disease.

With the in-licensing of anticancer compound ONX 0801 and the firm's decision to acquire additional oncology agents, Onyx is making strides to strengthen its clinical pipeline.

Nexavar's oral availability and combinability profile may allow it to become broadly used in the treatment of cancer; the drug is currently undergoing more than 200 clinical trials in the attempt to unlock its full potential. Read more

Bears Say

With its single-drug offerings and a lack of in-house R&D capabilities, Onyx could be left empty-handed if competitors demonstrate superior efficacy or Nexavar fails to penetrate the global market.

Nexavar yielded disappointing Phase III trial results in both lung cancer and metastatic melanoma, decreasing the drug's chances of approval in these indications and raising doubt about its ability to treat a wide array of cancers.

In the kidney cancer arena, Onyx faces stiff competition from large and small drug firms alike. As new drugs continue to enter the market, we think Onyx will need to work harder to maintain market share.

Nexavar may have difficulty reaching the East Asian markets, where more than half of worldwide deaths as a result of liver cancer occur; the high price of Nexavar and scarcity of insurance coverage in this area will likely prevent many patients from receiving this promising drug. Read more

Strategy

Onyx commercializes Nexavar, along with partner Bayer, for the treatment of liver and kidney cancer. Onyx aims to drive Nexavar to blockbuster status by increasing sales abroad, solidifying its leadership Read more

Management

Despite a largely independent board and management's successful track record bringing Nexavar to market, we award Onyx a fair Stewardship Grade because of overly generous executive compensation and the presence of a few barriers to change in the company's Read more

Profile

Onyx develops and markets novel therapies that target molecular mechanisms that cause cancer. The company's first commercially available product, Nexavar, is partnered with Read more

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