Genzyme's problems continue as Shire comes up with new Gaucher drug

According to analysts at Zacks Investment Research, US biotechnology major Genzyme Corp suffered a setback earlier this week when UK-based Shire announced positive Phase III results on velaglucerase alfa, an enzyme replacement therapy, which is being developed for the treatment of Gaucher disease.

Shire has initiated the process of submitting its New Drug Application for velaglucerase alfa under the US Food and Drug Administration's fast track process. Once approved, velaglucerase alfa, will be competing directly with Genzyme's lead product, Cerezyme (imiglucerase). Although Cerezyme holds a leading position in the treatment of Gaucher disease, the patient population for the disease is not large. As such, the entry of additional players in the market could restrict the company's future sales growth opportunities, the analysts say.

This news comes on the heels of an announcement made by Genzyme in late July that the FDA will be re-inspecting the company's Allston manufacturing facility. As a reminder, Genzyme has been facing manufacturing issues at its Allston plant, which was temporarily shut down due to contamination issues.