AstraZeneca, plc AZN and partner Merck & Co., Inc. MRK announced that the FDA has approved a new tablet formulation for ovarian cancer drug, Lynparza while also broadening its U.S. label.

AstraZeneca’s shares are up 11.5% so far this year, comparing unfavorably with an increase of 13.7% for the industry.

The FDA has approved expansion of Lynparza’s (tablets) label to include maintenance treatment of patients suffering from platinum-sensitive recurrent ovarian cancer regardless of BRCA-mutation status.

Meanwhile, the FDA also approved a new tablet formulation (2 tablets twice daily) of the PARP inhibitor as opposed to capsules (8 capsules twice daily), which should improve patient convenience.

Lynparza’s accelerated approval for BRCA-mutated ovarian cancer beyond the third-line setting was also converted to a regular approval. We remind investors that Lynparza was first approved by the FDA on an accelerated approval basis in Dec 2014, as a capsule formulation.

The label expansion strengthens Lynparza’s position in the PARP inhibitor market where competition has become fierce with Clovis Oncology, Inc.’s CLVS Rubraca, launched in Dec 2016, and Tesaro, Inc.’s TSRO Zejula (niraparib), available from Apr 2017. Shares of both these small biotechs were down on Thursday following the news.

Lynparza is also being evaluated in different studies for a range of tumor types including breast, prostate and pancreatic cancers as well as earlier-line settings for ovarian cancer.

AstraZeneca announced an oncology collaboration with Merck last month to commercialize and develop Lynparza, both as monotherapy and in combination studies for multiple cancer types. The companies will share development and marketing costs equally and also the profits from Lynparza.

AstraZeneca carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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