Friday, September 23, 2011

Wall Street-The Hepatitis C Race Is On

The Hepatitis C Race Is On
By James E. Brumley
Published: September 21, 2011 10:24:49 AM PDT

The race for an effective hepatitis C treatment may not be as high-profile as, say efforts to find a cure for cancer or HIV. It's a bigger market than most may imagine though, judging from the number of companies doing R&D in the arena. Here's a quick look at the key one.

Merck & Co., Inc. (NYSE:MRK) has one of only two FDA-approved hepatitis C drugs. Its version is called Victrelis - a protease inhibitor. It was only approved in May, so there's no sales momentum yet. If the efficacy seen in Phase II testing is any clue though, it should be a revenue driver. Merck said two-thirds of patients receiving Victrelis in combination with other treatments had a strong virologic response in that the virus was no longer detected in the blood six months weeks after the treatment was stopped.

Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) has the other FDA-approved hepatitis C treatment. Theirs is called Incivek - another protease inhibitor. Vertex's entry in the race seems even better than Merck's; nearly 80% of patients saw no sign of the virus in the blood 24 weeks after treatment.

Pharmasset, Inc. (NASDAQ:VRUS) is anything but a household name, and its drug is only in Phase II testing. But, PSI-7977 (a nucleoside polymerase inhibitor) is very promising. When used in combination with interferon and ribavirin, Pharmasset produces a 12-week sustained virological response rate of 91% for previously untreated hepatitis C patients.

Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) actually has several versions of its treatment currently anywhere from pre-clinical studies to Phase II trials. They're all built on the same basic platform though; all act as protease inhibitors. The underlying mechanism for these compounds is novel, targeting the NS4A protein of HCV. By inhibiting this target, Achillion Pharmaceuticals says the formation of a functional replicase complex (a key step in viral replication of the viral RNA genome) is blocked. ACH-1625 is the one to watch closely now.

Update/Correction: Achillion is exploring two distinct programs - protease inhibitors and NS5A inhibitors. The protease inhibitor program includes its lead Phase 2 compound ACH-1625, while the Phase 1 program is evaluating a novel pan-genotypic compound designated ACH-2684. The second class of compounds the company is developing are NS5A inhibitors, and is the backbone ACH-2928 (also in Phase 1 development).

Pfizer Inc. (NYSE:PFE) is in the hepatitis C race, but for a company of it size and financial backing, it's surprisingly lagging. Its polymerase inhibitor (PF-868554) is only in Phase II trials right now. Given the lateness of the effort and the fact that Pfizer has multiple partners on this front, it's hard to say HCV is a priority its going to push forward in a meaningful way.

Finally, Idenix Pharmaceuticals, Inc. (NASDAQ:IDIX) has a small army of hepatitis C treatment in the hopper (four in all, but they're all significantly different than one another). The one that's furthest along is IDX184, currently in Phase II, while work on IDX320 has been halted for the time being. Idenix Pharmaceuticals began 12-week trials of IDX184 in July of this year, and is expected to share interim results sometime in the fourth quarter. IDX184 has also been halted - albeit temporary - in the past by the FDA over safety concerns.

The hepatitis C market could be worth as much as $10 billion within five years, according to industry analysts. It affects tens of million of people worldwide every year.

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