The U.S. Food and Drug Administration on Tuesday ruled that Pfizer‘s (NYSE:PFE) tofacitinib is clear for use as a treatment for rheumatoid arthritis. The approval comes after a three-month delay following the FDA’s request for further information.
The drug, which will be marketed under the name Xeljanz, will directly compete with Abbott Laboratories‘ (NYSE:ABT) Humira and Johnson & Johnson‘s (NYSE:JNJ) Remicade. Analysts expect Xeljanz, which will cost more than $2,000 per month, to bring in more than $2 billion annually by 2018 in an overall market of more than $10 billion per year, according to Bloomberg.
The drug affects the parts of the human immune system that cause rheumatoid arthritis. Xeljanz, like Humira and Remicade, is only approved for use when other therapies fail. Those afflicted by rheumatoid arthritis typically are prescribed methotrexate initially, then moved to the other drugs if that doesn’t work.
Initial approval is only for twice-daily 5-milligram doses. Approval has been sought for a 10-milligram dose, but the FDA is requiring further studies before considering it.
PFE and ABT shares were each marginally lower in Wednesday premarket trading.