Celgene Corporation ( CELG ) announced a label expansion for its drug Otezla in the U.S. Otezla, already approved by the FDA for treating adults suffering from active psoriatic arthritis, can now be used in treatment-nave as well treatment experienced patients suffering from moderate-to-severe plaque psoriasis. The FDA approved the drug, an oral and selective inhibitor of phosphodiesterase 4 (PDE4), to treat those patients for whom phototherapy or systemic therapy is suitable.

Celgene said that following the FDA nod, Otezla becomes the first inhibitor in the above category to gain approval in the U.S. for the plaque psoriasis indication. Currently, psoriasis patients are mostly treated with injectable drugs like AbbVie's ( ABBV ) Humira and Amgen's ( AMGN ) Enbrel.

The FDA cleared Otezla for the new indication primarily on the basis of encouraging data from two multi-center, randomized, double-blind, placebo-controlled studies - ESTEEM 1 and ESTEEM 2. The U.S. regulatory body, however, recommended that patients taking Otezla should have their body weights monitored on a regular basis. Moreover, patients with a history of depression or suicidal behavior should inform the same to their doctors before commencing Otezla therapy.

We remind investors that Otezla gained FDA approval for the psoriatic arthritis indication in March this year (read more: Update on Celgene's Product Portfolio ). The drug contributed $5 million to Celgene's top line in the second quarter of 2014. Approval for the additional indication, which offers significant commercial potential, will boost Otezla's sales going forward. According to the National Psoriasis Foundation, the immune-mediated, non-contagious chronic inflammatory skin disorder affects 7.5 million Americans.

Celgene is seeking EU approval for Otezla in the combined psoriasis and psoriatic arthritis indication, with an opinion from the European Medicines Agency's Committee for Medicinal Products for Human Use expected by Dec 31, 2014. The candidate is further being evaluated for treating patients suffering from Behet's disease (phase III expected to commence by year end), ulcerative colitis (phase II b expected to commence by year end) and atopic dermatitis (phase II).

Celgene carries a Zacks Rank #3 (Hold). Better-ranked stocks in the health care space include Gilead Sciences ( GILD ) and Medivation ( MDVN ). Both the stocks sport a Zacks Rank #1 (Strong Buy).

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Celgene's Otezla Label Expanded to Include Plaque Psoriasis - Analyst Blog