Hepatitis C and Orphan Diseases Driving Big Biotech Potential: Geoff Meacham

Hepatitis C and Orphan Diseases Driving Big Biotech Potential: Geoff Meacham
By The Life Sciences Report, on February 8th, 2012 in Expert Interviews

TLSR: Geoff, is there a sweet spot in the market currently as far as therapeutic focus?

GM: Yes, it is hepatitis C virus (HCV). We’ve been talking about that for about two years, and it is still going to be a tremendous source of interest and innovation, no doubt about it. I think what’s attracted a lot of people is that you can derisk a hepatitis C asset relatively early. A phase 2 study with a few hundred patients, or maybe even fewer than 100, can inform the design and likely outcome of a larger phase 3 study. We’ve seen Pharmasset Inc. [acquired by Gilead Sciences Inc. (GILD:NASDAQ) for $11B on Jan. 17, 2012] and its robust opportunity with PSI-7977 in hepatitis C. Then in relatively small groups of patients, we’ve seen Inhibitex with its INX-189 in phase 2. My suspicion is that Idenix Pharmaceuticals Inc. (IDIX:NASDAQ) is probably another [acquisition] candidate, given that it is in hepatitis C and is in the so-called nuc (nucleotide or nucleoside analog) class space with IDX-184 in phase 2b. This nuc space is really hot right now. So hepatitis C is a sweet spot.

I also feel like orphan diseases are a sweet spot. In this case, ViroPharma Inc. (VPHM:NASDAQ) with its Cinryze (complement C1 esterase inhibitor) for hereditary angioedema (HAE) has had a huge run of late. I think it probably still has some upside although more limited than a name like an Alexion Pharmaceuticals Inc. (ALXN:NASDAQ) which had a big, big move last year. Alexion has its orphan disease drug Soliris (eculizumab) for paroxysmal nocturnal hemoglobulinuria (PNH), and it was also approved for its second indication atypical hemolytic uremic syndrome (aHUS). We also like the potential of Alexion’s new asset ENB-0040 (asfotase alfa) for the very rare disease hypophosphatasia (HPP) that came with the acquisition of Enobia Pharma Corp. That looks pretty robust.

Then on the smaller-cap side in orphan diseases, InterMune Inc. (ITMN:NASDAQ) is a stock that we’ve liked a lot. It has really been decimated. The performance this year is okay, but last year it dramatically underperformed on fears of a weak launch in Europe for its drug Esbriet (pirfenidone) for idiopathic pulmonary fibrosis (IPF). But it does look like the patient demand is there.
Hepatitis C and these orphan indications are two therapeutic categories I would point to that could continue to do well in 2012.

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