2011 Bush Library Art Contest Winners
“Precision Cut,” by 11th grade student Olga Belyanina.
Week Round Up
As this week comes to a close we take a look back at the most relevant HCV headlines, including today's news with updates as the day progresses. Click here to view previous or future TGIF articles.
Hepatitis C-What A Pain-Liver Pain!
As this week comes to a close we take a look back at the most relevant HCV headlines, including today's news with updates as the day progresses. Click here to view previous or future TGIF articles.
Hepatitis C-What A Pain-Liver Pain!
Posted Today-Source Medscape
Idenix Announces Removal of the Partial Clinical Hold on HCV Nucleotide Inhibitor, IDX184
CAMBRIDGE, Mass., Feb. 3, 2012 /PRNewswire/ -- Idenix Pharmaceuticals, Inc. (NASDAQ: IDIX), a biopharmaceutical company engaged in the discovery and development of drugs for the treatment of human viral diseases, today announced that it has received notification from the U.S. Food and Drug Administration (FDA) that the partial clinical hold on IDX184 has been removed and that the Company's 12-week phase IIb study evaluating IDX184 in combination with pegylated interferon and ribavirin (PegIFN/RBV) may continue. IDX184, the Company's lead product candidate for the treatment of hepatitis C virus (HCV) infection is a pan-genotypic oral nucleotide polymerase inhibitor, and has demonstrated a high barrier to resistance in vitro and potent antiviral activity in both preclinical and clinical studies. Recently announced interim phase IIb data demonstrated favorable antiviral activity and no serious adverse events.
"After review of the interim safety and antiviral activity results from the IDX184 phase IIb clinical trial, the FDA removed the partial clinical hold and has allowed us to continue enrollment of this study," Ron Renaud, President and Chief Executive Officer of Idenix, commented. "Importantly, this allows us to expand the phase IIb program and evaluate IDX184 in interferon-free combination regimens with other direct-acting antivirals. We are working toward beginning all-oral combination trials as quickly as possible."
About IDX184 Phase IIb Study
In July 2011, Idenix initiated enrollment of treatment-naive genotype 1 HCV-infected patients into a randomized, double-blind, parallel group phase IIb clinical trial of IDX184. The study features two treatment arms, either 50 mg or 100 mg of IDX184 administered once-daily for 12 weeks, each arm in combination with PegIFN/RBV. Study objectives include safety and tolerability, and antiviral activity endpoints. The FDA has agreed to truncate the study from 100 patients, as in the original protocol, to a total of 60 patients, and to expand the enrollment criteria.
About IDX184 Partial Clinical Hold
A clinical hold originally was issued in September 2010 as a result of three cases of elevated liver function tests observed during a drug-drug interaction study in healthy volunteers of the combination of IDX184 and IDX320, an investigational HCV protease inhibitor. Idenix reviewed available data and conducted additional preclinical studies. With the help of independent experts and an external safety committee, the Company concluded that the observed toxicity was likely caused by IDX320 and submitted all data to the FDA. At the beginning of 2011, the FDA removed a full clinical hold on IDX184, and the program was placed on partial clinical hold allowing the Company to initiate the 12-week phase IIb study for IDX184 in July 2011. In January 2012, Idenix submitted interim phase IIb data for the first 31 patients to the FDA, along with a recommendation from the independent Data Safety Monitoring Board to continue the study, and requested removal of the partial clinical hold on IDX184. The partial clinical hold has now been removed allowing the initiation of dosing of an additional 30 patients in the ongoing phase IIb clinical trial and the initiation of a broad phase IIb program with IDX184 in the coming months.
About IDX184
IDX184 is an unpartnered, novel, liver-targeted nucleotide prodrug of 2'-methyl guanosine, which includes Idenix's proprietary liver-targeting technology. This technology enables the delivery of nucleoside monophosphate to the liver, leading to the formation of high levels of nucleoside triphosphate, potentially maximizing drug efficacy and limiting systemic side effects with low, once-daily dosing.
About Idenix
Idenix Pharmaceuticals, Inc., headquartered in Cambridge, Massachusetts, is a biopharmaceutical company engaged in the discovery and development of drugs for the treatment of human viral diseases. Idenix's current focus is on the treatment of patients with hepatitis C infection. For further information about Idenix, please refer to www.idenix.com.
Forward-Looking Statements
This press release contains "forward-looking statements" for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995, including but not limited to the statements regarding the Company's future business and financial performance. For this purpose, any statements contained herein that are not statements of historical fact may be deemed forward-looking statements. Without limiting the foregoing, the words "expect," "plans," "anticipates," "intends," "will," and similar expressions are also intended to identify forward-looking statements, as are expressed or implied statements with respect to the Company's potential pipeline candidates, including any expressed or implied statements regarding the efficacy and safety of IDX184 or any other drug candidate; the successful development of novel combinations of direct-acting antivirals for the treatment of hepatitis C; the likelihood and success of any future clinical trials involving our drug candidates; and expectations with respect to funding of operations and future cash balances. Actual results may differ materially from those indicated by such forward-looking statements as a result of risks and uncertainties, including but not limited to the following: there can be no guarantees that the Company will advance any clinical product candidate or other component of its potential pipeline to the clinic, to the regulatory process or to commercialization; management's expectations could be affected by unexpected regulatory actions or delays; uncertainties relating to, or unsuccessful results of, clinical trials, including additional data relating to the ongoing clinical trials evaluating its product candidates; the Company's ability to obtain additional funding required to conduct its research, development and commercialization activities; the Company's dependence on its collaboration with Novartis Pharma AG; changes in the Company's business plan or objectives; the ability of the Company to attract and retain qualified personnel; competition in general; and the Company's ability to obtain, maintain and enforce patent and other intellectual property protection for its product candidates and its discoveries. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. These and other risks which may impact management's expectations are described in greater detail under the heading "Risk Factors" in the Company's quarterly report on Form 10-Q for the quarter ended September 30, 2011, as filed with the Securities and Exchange Commission (SEC) and in any subsequent periodic or current report that the Company files with the SEC.
All forward-looking statements reflect the Company's estimates only as of the date of this release (unless another date is indicated) and should not be relied upon as reflecting the Company's views, expectations or beliefs at any date subsequent to the date of this release. While Idenix may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so, even if the Company's estimates change.
Idenix Pharmaceuticals Contacts:
Kelly Barry (617) 995-9033 (media)
Teri Dahlman (617) 995-9807 (investors)
SOURCE Idenix Pharmaceuticals, Inc.
Last Updated: February 02, 2012.
Liver-like cells produced from an individual's own cells can support the entire life cycle of hepatitis C virus, potentially making it possible to study why people respond differently to the virus, according to a study published online Jan. 30 in the Proceedings of the National Academy of Sciences.
THURSDAY, Feb. 2 (HealthDay News) -- Liver-like cells produced from an individual's own cells can support the entire life cycle of hepatitis C virus, potentially making it possible to study why people respond differently to the virus, according to a study published online Jan. 30 in the Proceedings of the National Academy of Sciences.
Robert E. Schwartz, M.D. Ph.D., from the Massachusetts Institute of Technology in Cambridge, and colleagues examined whether hepatocyte-like cells produced by the differentiation of induced pluripotent stem cells could be infected by hepatitis C virus.
The researchers found that the hepatocyte-like cells could support the entire life cycle of the virus, including infection, replication, and production of infectious virions. In addition, infection induced an antiviral inflammatory response.
"We believe that this study lays the foundation for personalized in vitro models that can capture genetic variation of both host and pathogen, whereby induced pluripotent stem cells can be generated from identified patients with known or unknown genetic defects that impact infection," Schwartz and colleagues conclude.
Abstract
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Gilead Sciences' CEO Discusses Q4 2011 Results - Earnings Call Transcript
Gilead Sciences (GILD) Q4 2011 Earnings Call February 2, 2012 5:00 PM ET
Operator
Ladies and gentlemen, thank you for standing by, and welcome to the Gilead Sciences Fourth Quarter 2011 Earnings Conference Call. My name is Stacy, and I will be your conference moderator for today. [Operator Instructions] As a reminder, this conference call is being recorded today, February 2, 2012. I would now like to turn the call over to Ms. Susan Hubbard, Vice President of Investor Relations. Please go ahead.
Susan Hubbard
Thank you, Stacy. Good afternoon, everyone, and welcome to Gilead's Fourth Quarter 2011 Earnings Conference Call. We issued a press release this afternoon providing earnings results for the quarter and full year 2011. Its press release is available on our website as are the slides that provide much more detail around the topics covered on today's call. I'm joined today by our President and Chief Operating Officer, John Milligan, who will review the key milestones and strategic initiatives from 2011; followed by our CFO, Robin Washington, who will provide additional details on our financial results and our 2012 guidance; Kevin Young, EVP of Commercial Operations will discuss our commercial performance; and then Norbert Bischofberger, EVP of R&D, will provide an R&D update and key milestones. John Martin, Chairman and CEO, will close out the prepared remarks by outlining our strategic initiatives for the year ahead.
As a reminder, during today's call, we will be making forward-looking statements regarding our financial outlook in addition to regulatory and product development plan. These statements are subject to risks and uncertainties that may cause actual results to differ from those expressed in any forward-looking statement.
A description of these risks can be found on our latest SEC disclosure documents and recent press releases. In addition, please note we undertake no duty to update or revise them. We will also use non-GAAP financial measures to help you understand our underlying business performance. The GAAP reconciliations are provided in our press release as well as on our corporate website.
I will now turn the call over to John Milligan.
John F. Milligan
Thank you, Susan. Thank you all for joining us today. Our team's hard work over the last several years resulted in many significant financial, commercial and R&D milestones in 2011. We saw record revenues for ATRIPLA, Truvada, AmBisome, Ranexa, Letairis and Cayston. We also achieved record market share for our combined HIV portfolio as well as our cardiopulmonary products. Robin and Kevin will review these outstanding financial and commercial results with you and then Norbert will describe some of our many R&D accomplishments.
Single-tablet regimens are becoming the standard of care for HIV treatment, and as you know, it is Gilead's ongoing strategy to provide HIV patients with additional options for simplified regimens. During the fourth quarter, the European Commission granted approval of the Truvada rilpivirine, single-tablet regimen for the treatment of HIV. This product, marketed in the EU as Eviplera and as Complera in the U.S., constitutes our second single-tablet regimen and began launching in 2011 in the U.S., Canada, the U.K. and Austria.
Regulatory submissions for approval were made in the U.S. and EU during 2011 for Quad, which if approved will be Gilead's third single-tablet regimen for the treatment of HIV infection. The NDA was filed less than 6 weeks after data lock. These accelerated timelines for collecting and analyzing the data and filing in both the U.S. and EU were made possible by the dedication and skill of our R&D teams.
Just 2 weeks ago, FDA approved lower strength tablets and an oral powder formulation of Viread for the treatment of HIV-1 infection in pediatric patients from ages 2 to 12. We are pleased to provide this important therapeutic option for younger HIV patients and are working to make the pediatric formulations of Viread available in the U.S. and abroad.
For a number of years, we've been collaborating with various organizations to explore the use of Truvada for pre-exposure prophylaxis or PrEP. Several studies have shown that the use of Truvada in uninfected at-risk adults can reduce HIV transmission. Based on these observations, a supplemental NDA was submitted to FDA in December for the approval of Truvada for prevention of HIV infection among uninfected high-risk adults. To get expert advice on this application, FDA is determined that an advisory committee meeting for the antiviral division will be held in the May timeframe.
We continue to believe that there's room for significant innovation in the area of HIV and during the year announced a new collaboration with Tibotec to develop the first single-tablet regimen containing a protease inhibitor. Tibotec's PI, darunavir, has now been successfully combined into a single pill with emtricitabine and our investigational agents, cobicistat and GS-7340. And we anticipate clinical studies to begin later this year. In addition, a Phase II study was initiated in the fourth quarter of 2011 for a single-tablet regimen containing emtricitabine, elvitegravir, cobicistat and GS-7340.
Last year, we entered into a licensing agreement with Boehringer Ingelheim, which allowed us to combine BI's patent estate and compounds on non-catalytic site inhibitors for HIV with our internal research programs. Integrase inhibitors working by this mechanism are not expected to be cross resistant to elvitegravir and we look forward to sharing with you future data on these exciting new co-activates of the inhibitors.
On the liver disease front, 5-year data from the ongoing open label phase of our 2 Phase III clinical studies of Viread for the treatment of chronic hepatitis B represented at the key U.S. Liver Meeting, AASLD. These data showed that 5 years of Viread treatment did not just help further progression of fibrosis but actually resulted in improvement of liver fibrosis in 51% of patients and regression of cirrhosis in 74%. We continue to be enthusiastic about the prospects to help people with chronic HPV by developing finite duration treatment. With this goal in mind, an exclusive worldwide licensing and collaboration agreement with GlobeImmune was announced in October. This research is aimed at developing a therapeutic vaccine that will enhance "s" antigen conversions providing a functional cure for HPV-infected individuals. In keeping with our philosophy to develop best-in-class drugs, we acquired Pharmasset in order to bring PSI-7977 to our portfolio. We anticipate that we will be able to conduct and complete the clinical study and to allow the first approval of 7977 in combination with ribavirin by FDA during the first half of 2014. We also plan to initiate the development of alternative 7977-containing regimens, including single-tablet regimens with other candidates in our portfolio. This strategy has the potential to benefit a large number of patients and provides the opportunity for a significant revenue growth and diversification in 2014 and beyond.
Gilead's liver disease team enrolled more than 1,400 HCV-infected patients in various clinical studies during 2011, demonstrating their capacity to work towards these accelerated timelines.
In summary, 2011 was a very productive year for Gilead and I'm very proud of the individual and collective efforts of all our employees. I will now turn the call over to Rob as he discuss in more detail our financial results. Robin?
Robin L. Washington
Thanks, John. Good afternoon, everyone, and thank you for joining us. As John mentioned, we made exciting advances in our products and pipeline program, and our continued commercial execution delivered solid financial performance in spite of a challenging macroeconomic environment. For the fourth quarter, product sales were $2.1 billion, an increase of 11% year-over-year. We completed the year with total product sales at the upper end of our guidance at $8.1 billion, an increase of 10% over the prior year. At $8.1 billion, we now have a worldwide business that is 6x the size we were in 2004 when we first launched Truvada in the United States. North America product sales for 2011 were close to $5 billion in total and Europe approached the notable milestone of $3 billion. Gilead generated product revenues above $200 million in 7 countries and today have commercial operational capabilities in the U.S., Canada, Europe, Australia with a growing presence in South Korea, Hong Kong, Taiwan and Singapore. Our fiscal year 2011 non-GAAP product gross margin decreased slightly to 74.8% from 75.8% in fiscal year 2010 primarily due to an annual selling price adjustment for the percentage share of ATRIPLA that is paid to our partner. This adjustment occurred late in Q4. Compared to Q4 of the prior year, this selling price adjustment had an unfavorable impact of approximately 2% on our product gross margin.
Non-GAAP R&D expenses for 2011 were $1.1 billion, approximately $90 million above the upper end of our guidance. This was primarily due to the milestone payment associated with our accelerated registration of filings for Quad in the U.S. and Europe. In addition to the investments we made in our internal programs over the course of the year, we augmented these efforts through strategic investments and acquisitions and licensing opportunities and collaborations, which in totality resulted in additional R&D expenses for the fourth quarter and full year of approximately $60 million and $100 million, respectively.
Our 2011 non-GAAP SG&A expenses were $1.1 billion, in line with our guidance. When compared to the prior year, non-GAAP SG&A increased primarily due to expenses associated with the ongoing growth of our business, the U.S. pharmaceutical excise tax expense and bad debt provision due to slower collections in certain southern European countries.
Turning to cash flows. For the full year 2011, we generated $3.6 billion of operating cash flow, of which approximately $1 billion was generated in the fourth quarter. Our track record of generating strong operational cash flows enabled us to raise a total of $5.9 billion in debt to partially fund our acquisition of Pharmasset while maintaining our investment-grade credit rating.
The last financial highlight that I would like to share is our full year 2012 guidance, which is detailed on Slide 23 in the earnings call deck available on our corporate website. Please note that this guidance is inclusive of the Pharmasset acquisition, which closed in January. For full year 2012, we are projecting product sales of $8.6 billion to $8.8 billion, reflecting a 6% to 9% increase over 2011 product sales. This range includes the U.S. launch of Quad in the second half of 2012; the growth of Complera and Eviplera in the U.S. and Europe, respectively; the continued gains from our non-HIV products tempered by the ongoing economic uncertainties in Europe and the potential for a continued volatility in foreign currency exchange rates. For example, we estimate that a 10% fluctuation in rates or hedged currencies could have $150 million to $200 million impact on our product sales. Please note that the non-GAAP product gross margin and operating expense guidance provided to you include the impact of acquisition, restructuring and stock-based compensation related expenses where applicable.
Our non-GAAP product gross margin for the full year 2012 is expected to be in the range of 73% to 75%. We expect non-GAAP R&D expenses for the full year 2012 to be in the range of $1.325 billion to $1.4 billion. This range includes a full year operating expense impact of all our recent acquisitions, including Calistoga, Arresto, Oceanside and, most recently, Pharmasset.
We expect non-GAAP SG&A expenses for the full year 2012 to be in the range of $1.225 billion to $1.3 billion, which includes the anticipated impact of Quad launch and a higher U.S. pharmaceutical excise tax expense. Our effective tax rate for the full year 2012 is expected to be in the range of 26% to 28% due primarily to the expiration of the federal R&D tax credit and the increase in the U.S. pharmaceutical excise tax, which is nondeductible reversible.
As detailed on Slide 24, we are anticipating a full year 2012 diluted EPS impact of acquisition, restructuring and stock-based compensation related expenses to be in the range of $0.31 to $0.34 per share. And finally, we anticipate the net interest impact associated with the Pharmasset transaction to be approximately $230 million for 2012, which is detailed on Slide 25.
I'll now turn the call over to Kevin to share more review regarding our 2011 commercial performance and our outlook for 2012.
Kevin B. Young
Thank you, Robin. I am very proud of the many accomplishments achieved by our commercial organization in 2011 and our results in Q4 bode well for a successful 2012. Especially encouraging were the U.S. Truvada and ATRIPLA Q4 year-on-year growth rates of 9% and 11%, respectively. These results reflect the final release of 2011 ADAP federal funds and the resulting 50% reduction in patient waitlists from that peak. HIV product revenues were unaffected by large wholesale inventory levels and non-retail purchasing was healthy yet in line with patient demand.
The key patient drivers of HIV growth also looked very encouraging for Q3 2011, our latest data point. In the U.S., the moving annual total number of anti-retroviral-treated patient remained strong at 9% and the median CD4 count at treatment initiation hit an all-time high of 347. We have also been pleased with the uptick of Complera since its U.S. approval and launch in August of last year. Our goal of bringing the combination product of Truvada and rilpivirine to market was to provide additional options to physicians and expand the total number of HIV patients receiving a single-tablet regimen. With this in mind, I'm delighted to say that since the launch of Complera, we are seeing a 37% growth in the number of prescriptions for patients starting on a single-tablet regimen. We hope to reproduce this performance in Europe as we roll out Eviplera during 2012. To date, we have begun supplying Eviplera in the U.K., Austria and Germany.
Moving on our exceptional performance in HIV in 2011, I'm pleased to say that we have a growing business outside our core antiviral franchise. 30% of net product revenues or over $1 billion came from AmBisome, Ranexa, Letairis and Cayston in 2011. Importantly, Letairis and Ranexa had year-on-year growth rates of 22% and 33%, respectively. As I think about 2012, the underlying drivers of HIV commercial growth continue to look robust. The scientific arguments in HIV to diagnose more patients and treat them earlier have never been stronger. Moreover, the reasons to be using single-tablet regimens are compelling both medically and practically.
During 2012, we will continue to rollout Complera around the world and subject to FDA approval will bring our third single-tablet regimen to individuals in the U.S. living with HIV. We feel confident that the Quad will become an important treatment option for HIV patients initiating therapy and will ultimately be positioned as a preferred therapy in U.S. and international treatment guidelines. Like the rest of the pharmaceutical industry, we will undoubtedly continue to see some headwinds in European markets. Nevertheless, the spectionist nature of Gilead products and the strength of the pharmacoeconomic arguments to treat HIV placed us in a strong position for future growth. We will look for opportunities to open up new operating affiliates as we have done successfully in recent years in Austria, Switzerland and Poland where we see sustainable and profitable businesses and healthcare systems that support breakthrough medicines.
Finally, like the rest of my colleagues, I strongly believe that the acquisition of Pharmasset is a transformational milestone for Gilead. The worldwide potential for all oral antiviral pan-genotypic HCV cure is sizable with over 12 million infected individuals in commercial markets alone. We are already in high gear preparing global launch plans that will bring GS-7977 expeditiously to patients around the world. Our established relationships with the hepatologist and gastroenterologist via Viread HPV, our knowledge of liver disease payers and policy makers and the exciting potential of leveraging our HIV resources to expand HCV-provided capacity is a galvanizing prospect. And I am confident the Gilead commercial organization will rise to the occasion.
I will now hand the call over to Norbert Bischofberger. Norbert?
Norbert W. Bischofberger
Thank you, Kevin. For HIV, in the fall of last year, we provided positive top line results from the 2 pivotal Phase III studies comparing Quad with 2 current standard-of-care regimens, ATRIPLA in Study 102 and atazanavir boosted by ritonavir with Truvada in Study 103. In both cases, at 48 weeks, Quad proved to be non-inferior to the standard-of-care regimens. The 90% response rate observed on the Quad arm in Study 103 is the highest response rate seen in any large, blinded, randomized study of HIV patients. The 48-week results for both pivotal studies were accepted for presentation at the Conference on Retroviruses and Opportunistic Infections or CROI taking place in Seattle, March 5 through 8. Study 102 will be the subject of an oral presentation in Study 103 of a poster.
Across all our HIV programs, there will be at least 45 presentations at CROI, highlighting the important role of Gilead products in the treatment of HIV infection. In the U.S., the NDA application for Quad has been accepted by FDA for standard review with a PDUFA date of August 27. In addition, FDA indicated that a panel will be convened in the May timeframe to provide expert advice on the application. In Europe, we anticipate that EMEA will complete the review by the end of this year.
To further define the profile of the Quad, we have initiated three 48-week Phase IIIb studies to reevaluate switching of biologically suppressed patients from ATRIPLA to Quad in one study from Truvada plus a protease inhibitor to Quad and the other and from raltegravir plus Truvada to Quad in the third study. We expect data from all 3 studies to be available by late 2013. The Quad filing will be followed by regulatory filings this year for the single agent of elvitegravir and cobicistat. The filing for elvitegravir will be supported by Study 145 comparing elvitegravir to raltegravir in treatment-experienced patients. 96-week data indicating non-inferiority of the 2 arms were released in 2011.
The cobicistat filing will be supported by study 114, a Phase III study comparing cobicistat to ritonavir, both in combination with atazanavir and Truvada. We have released top line results from this study, which also met its 48-week primary objective of non-inferiority.
Last week, we announced the initiation of a Phase II clinical trial evaluating GS-7340 for the treatment of HIV infection in treatment-naïve adults. This 150-patient Phase II study will evaluate GS-7340 as a part of a once-daily, co-formulated, single-tablet regimen that will also contain cobicistat, elvitegravir and emtricitabine and will be compared to our Quad single-tablet regimen.
Moving to cardiovascular. Ranexa appears unique among anti-angina agents, because in addition to reducing ischemia in angina, there's evidence that it also lowers HbA1c, the biomarker for type 2 diabetes. 30% to 40% of coronary artery disease patients also have type 2 diabetes. Hence, these patients could potentially derive a bold benefit from Ranexa. In order to further define this potential benefit, we've initiated a Phase III program that includes 3 studies involving approximately 400 patients each to determine the effect of Ranexa alone or in combination with other antidiabetic therapies in lowering HbA1c and plasma glucose after 24 weeks of treatment. Confirmation of the antidiabetic effect of ranolazine in these studies could lead to a new indication of ranolazine for the treatment of type 2 diabetes.
Another opportunity for Ranexa is it's used in conjunction with percutaneous coronary intervention or PCI to prevent subsequent major adverse outcomes. A subgroup analysis of MERLIN, a 7,000-patient study of Ranexa in acute coronary syndrome indicated that Ranexa treatment resulted in a reduction of major adverse cardiovascular events in patients with a history of angina undergoing PCI. A Phase III study has started to further define the potential benefit of Ranexa post-PCI. In this trial, 2,600 patient with the history of angina undergoing PCI with incomplete revascularization will be randomized to Ranexa or placebo with the end point of major adverse cardiovascular events.
On the oncology front, in further strengthening of R&D management, Roy Baynes has joined the Gilead team as Senior Vice President, Oncology Therapeutics. Roy joined us from Amgen where he served as Vice President, Global Development and Therapeutic Area Head for Hematology Oncology. Throughout his tenure there over the last decade, he helped the Clinical Development and Medical Affairs teams responsible for the approval and launch of numerous hematology and oncology products.
Gilead has acquired promising oncology assets over the last couple of years and voice leadership will be important in bringing these novel candidates to market. GS-1101 went into Phase III development this quarter with studies in chronic lymphocytic leukemia. In addition, patients are being involved in 3 Phase II studies of the monoclonal antibody, GS-6624. These Phase II studies are evaluating the efficacy and safety of 2 different doses of GS-6624 in myelofibrosis, pancreatic and colorectal cancers. The pancreatic and colorectal cancer studies are both randomized, blinded studies comparing 6624 versus placebo when added to the standard of care in second line metastatic disease. In addition, 6624 is also being evaluated in a Phase Ib study in IPS and in a Phase II study for liver fibrosis and HCV-infected patients.
And finally, turning to liver disease. John, Robin and Kevin have all mentioned the important acquisition of Pharmasset. We are proceeding with the Pharmasset Phase III development plan for GS-7977 in genotype 2 and 3 patients. This program consists of 2 studies, 1 in treatment-naïve patients with patent interferon ribavirin as the control arm, the second in interferon intolerant in eligible patients with placebo as the control arm. I'm pleased to report that the treatment-naïve study was initiated in mid-December, and since then, we have screened 145 patients. This trial is the rate-limiting study for filing because of the 24-week duration standard-of-care arm. Due to the great interest and fast enrollment, we anticipate that these 2 Phase III studies will reach target enrollment in the United States before we will be able to activate sites in other geographies.
As you know, results from the ELECTRON study were presented by Pharmasset at AASLD last October where GS-7977 and ribavirin for 12 weeks resulted in 10 out of 10 cures in genotype 2/3 patients. We're awaiting data from multiple studies in genotype 1 patients specifically from the ELECTRON study, which involve genotype 1, both treatment-naïve and null responders, as well as on the QUANTUM study, which involve genotype 1 treatment-naïve patients. We received news this week that our late breaker abstract has been accepted to CROI for 2 cohorts of genotype 1 HCV-infected patients from the ELECTRON study null responders and treatment naïve patients. In both cohorts of that study, all patients treated with GS-7977 and ribavirin achieved undetectable viral load at 4 weeks on treatment, also known as rapid biological response or RVR.
By the time we present those results, we will have 4 weeks of staying by watching for the response data or SVR4 from the nonresponder patients. Many of you noticed, but it's important to reiterate that RVR reflects biological response on treatment. However, the important measure of response and the accepted Phase III endpoint is SVR12, which is a sustained biological response 12 weeks after end of treatment. SVR4 data are a reasonable proxy for SVR12 as most patients that rebound after treatment discontinuation do so in the first 4 weeks.
We also anticipate that we will have a significant presence at the European Liver Conference taking place in Barcelona in April with over 17 submitted abstracts from our HCV effort alone. As Gilead has pioneered in HIV, we expect to bring forward next generation single type of regimens for the treatment of hepatitis C also. To that end, drug interactions will be carried out with 7977 and GS-5885 and other internal candidates, which will be followed by Phase II clinical studies.
In closing, the investments we're making today, both in our broad and promising internal R&D efforts we have embarked upon, will continue to drive the success of our business in the future. I would now turn over the call to John Martin. John?
John C. Martin
Thank you, Norbert. As you have heard, we met a number of important milestones in 2011 that were achieved as a result of all the hard work of Gilead employees over the last several years. This momentum is continuing into 2012. For HIV, we will continue to benefit from the evolution of the U.S., European and international guidelines that support earlier diagnosis and treatment as well as the growing appreciation for the benefits provided by single-tablet regimens. In 2006, the Centers for Disease Control and Prevention suggested HIV testing as part of routine medical care in order to decrease the incidence of new infections. This benefit has now been quantified in study HPTN 052, demonstrating that HIV treatment results in 96% reduction of HIV transmissions in serodiscordant couples. The publication of this work in the New England Journal of Medicine was recognized in December as the Breakthrough of the Year by Science Magazine. The high efficacy demonstrated in HPTN 052 has ended the debate on the value of treatment as prevention.
In summary, we look forward to adding to the strength of our HIV business with our growing pipeline in cardiopulmonary, oncology and liver disease. As we enter our 25th year, I believe that the health of our company has never been stronger with prospects for exceptional growth for many years to come.
Idenix gets good news on hep C trial, but can't compete with Gilead
Gilead Sciences (GILD) Q4 2011 Earnings Call February 2, 2012 5:00 PM ET
Operator
Ladies and gentlemen, thank you for standing by, and welcome to the Gilead Sciences Fourth Quarter 2011 Earnings Conference Call. My name is Stacy, and I will be your conference moderator for today. [Operator Instructions] As a reminder, this conference call is being recorded today, February 2, 2012. I would now like to turn the call over to Ms. Susan Hubbard, Vice President of Investor Relations. Please go ahead.
Susan Hubbard
Thank you, Stacy. Good afternoon, everyone, and welcome to Gilead's Fourth Quarter 2011 Earnings Conference Call. We issued a press release this afternoon providing earnings results for the quarter and full year 2011. Its press release is available on our website as are the slides that provide much more detail around the topics covered on today's call. I'm joined today by our President and Chief Operating Officer, John Milligan, who will review the key milestones and strategic initiatives from 2011; followed by our CFO, Robin Washington, who will provide additional details on our financial results and our 2012 guidance; Kevin Young, EVP of Commercial Operations will discuss our commercial performance; and then Norbert Bischofberger, EVP of R&D, will provide an R&D update and key milestones. John Martin, Chairman and CEO, will close out the prepared remarks by outlining our strategic initiatives for the year ahead.
As a reminder, during today's call, we will be making forward-looking statements regarding our financial outlook in addition to regulatory and product development plan. These statements are subject to risks and uncertainties that may cause actual results to differ from those expressed in any forward-looking statement.
A description of these risks can be found on our latest SEC disclosure documents and recent press releases. In addition, please note we undertake no duty to update or revise them. We will also use non-GAAP financial measures to help you understand our underlying business performance. The GAAP reconciliations are provided in our press release as well as on our corporate website.
I will now turn the call over to John Milligan.
John F. Milligan
Thank you, Susan. Thank you all for joining us today. Our team's hard work over the last several years resulted in many significant financial, commercial and R&D milestones in 2011. We saw record revenues for ATRIPLA, Truvada, AmBisome, Ranexa, Letairis and Cayston. We also achieved record market share for our combined HIV portfolio as well as our cardiopulmonary products. Robin and Kevin will review these outstanding financial and commercial results with you and then Norbert will describe some of our many R&D accomplishments.
Single-tablet regimens are becoming the standard of care for HIV treatment, and as you know, it is Gilead's ongoing strategy to provide HIV patients with additional options for simplified regimens. During the fourth quarter, the European Commission granted approval of the Truvada rilpivirine, single-tablet regimen for the treatment of HIV. This product, marketed in the EU as Eviplera and as Complera in the U.S., constitutes our second single-tablet regimen and began launching in 2011 in the U.S., Canada, the U.K. and Austria.
Regulatory submissions for approval were made in the U.S. and EU during 2011 for Quad, which if approved will be Gilead's third single-tablet regimen for the treatment of HIV infection. The NDA was filed less than 6 weeks after data lock. These accelerated timelines for collecting and analyzing the data and filing in both the U.S. and EU were made possible by the dedication and skill of our R&D teams.
Just 2 weeks ago, FDA approved lower strength tablets and an oral powder formulation of Viread for the treatment of HIV-1 infection in pediatric patients from ages 2 to 12. We are pleased to provide this important therapeutic option for younger HIV patients and are working to make the pediatric formulations of Viread available in the U.S. and abroad.
For a number of years, we've been collaborating with various organizations to explore the use of Truvada for pre-exposure prophylaxis or PrEP. Several studies have shown that the use of Truvada in uninfected at-risk adults can reduce HIV transmission. Based on these observations, a supplemental NDA was submitted to FDA in December for the approval of Truvada for prevention of HIV infection among uninfected high-risk adults. To get expert advice on this application, FDA is determined that an advisory committee meeting for the antiviral division will be held in the May timeframe.
We continue to believe that there's room for significant innovation in the area of HIV and during the year announced a new collaboration with Tibotec to develop the first single-tablet regimen containing a protease inhibitor. Tibotec's PI, darunavir, has now been successfully combined into a single pill with emtricitabine and our investigational agents, cobicistat and GS-7340. And we anticipate clinical studies to begin later this year. In addition, a Phase II study was initiated in the fourth quarter of 2011 for a single-tablet regimen containing emtricitabine, elvitegravir, cobicistat and GS-7340.
Last year, we entered into a licensing agreement with Boehringer Ingelheim, which allowed us to combine BI's patent estate and compounds on non-catalytic site inhibitors for HIV with our internal research programs. Integrase inhibitors working by this mechanism are not expected to be cross resistant to elvitegravir and we look forward to sharing with you future data on these exciting new co-activates of the inhibitors.
On the liver disease front, 5-year data from the ongoing open label phase of our 2 Phase III clinical studies of Viread for the treatment of chronic hepatitis B represented at the key U.S. Liver Meeting, AASLD. These data showed that 5 years of Viread treatment did not just help further progression of fibrosis but actually resulted in improvement of liver fibrosis in 51% of patients and regression of cirrhosis in 74%. We continue to be enthusiastic about the prospects to help people with chronic HPV by developing finite duration treatment. With this goal in mind, an exclusive worldwide licensing and collaboration agreement with GlobeImmune was announced in October. This research is aimed at developing a therapeutic vaccine that will enhance "s" antigen conversions providing a functional cure for HPV-infected individuals. In keeping with our philosophy to develop best-in-class drugs, we acquired Pharmasset in order to bring PSI-7977 to our portfolio. We anticipate that we will be able to conduct and complete the clinical study and to allow the first approval of 7977 in combination with ribavirin by FDA during the first half of 2014. We also plan to initiate the development of alternative 7977-containing regimens, including single-tablet regimens with other candidates in our portfolio. This strategy has the potential to benefit a large number of patients and provides the opportunity for a significant revenue growth and diversification in 2014 and beyond.
Gilead's liver disease team enrolled more than 1,400 HCV-infected patients in various clinical studies during 2011, demonstrating their capacity to work towards these accelerated timelines.
In summary, 2011 was a very productive year for Gilead and I'm very proud of the individual and collective efforts of all our employees. I will now turn the call over to Rob as he discuss in more detail our financial results. Robin?
Robin L. Washington
Thanks, John. Good afternoon, everyone, and thank you for joining us. As John mentioned, we made exciting advances in our products and pipeline program, and our continued commercial execution delivered solid financial performance in spite of a challenging macroeconomic environment. For the fourth quarter, product sales were $2.1 billion, an increase of 11% year-over-year. We completed the year with total product sales at the upper end of our guidance at $8.1 billion, an increase of 10% over the prior year. At $8.1 billion, we now have a worldwide business that is 6x the size we were in 2004 when we first launched Truvada in the United States. North America product sales for 2011 were close to $5 billion in total and Europe approached the notable milestone of $3 billion. Gilead generated product revenues above $200 million in 7 countries and today have commercial operational capabilities in the U.S., Canada, Europe, Australia with a growing presence in South Korea, Hong Kong, Taiwan and Singapore. Our fiscal year 2011 non-GAAP product gross margin decreased slightly to 74.8% from 75.8% in fiscal year 2010 primarily due to an annual selling price adjustment for the percentage share of ATRIPLA that is paid to our partner. This adjustment occurred late in Q4. Compared to Q4 of the prior year, this selling price adjustment had an unfavorable impact of approximately 2% on our product gross margin.
Non-GAAP R&D expenses for 2011 were $1.1 billion, approximately $90 million above the upper end of our guidance. This was primarily due to the milestone payment associated with our accelerated registration of filings for Quad in the U.S. and Europe. In addition to the investments we made in our internal programs over the course of the year, we augmented these efforts through strategic investments and acquisitions and licensing opportunities and collaborations, which in totality resulted in additional R&D expenses for the fourth quarter and full year of approximately $60 million and $100 million, respectively.
Our 2011 non-GAAP SG&A expenses were $1.1 billion, in line with our guidance. When compared to the prior year, non-GAAP SG&A increased primarily due to expenses associated with the ongoing growth of our business, the U.S. pharmaceutical excise tax expense and bad debt provision due to slower collections in certain southern European countries.
Turning to cash flows. For the full year 2011, we generated $3.6 billion of operating cash flow, of which approximately $1 billion was generated in the fourth quarter. Our track record of generating strong operational cash flows enabled us to raise a total of $5.9 billion in debt to partially fund our acquisition of Pharmasset while maintaining our investment-grade credit rating.
The last financial highlight that I would like to share is our full year 2012 guidance, which is detailed on Slide 23 in the earnings call deck available on our corporate website. Please note that this guidance is inclusive of the Pharmasset acquisition, which closed in January. For full year 2012, we are projecting product sales of $8.6 billion to $8.8 billion, reflecting a 6% to 9% increase over 2011 product sales. This range includes the U.S. launch of Quad in the second half of 2012; the growth of Complera and Eviplera in the U.S. and Europe, respectively; the continued gains from our non-HIV products tempered by the ongoing economic uncertainties in Europe and the potential for a continued volatility in foreign currency exchange rates. For example, we estimate that a 10% fluctuation in rates or hedged currencies could have $150 million to $200 million impact on our product sales. Please note that the non-GAAP product gross margin and operating expense guidance provided to you include the impact of acquisition, restructuring and stock-based compensation related expenses where applicable.
Our non-GAAP product gross margin for the full year 2012 is expected to be in the range of 73% to 75%. We expect non-GAAP R&D expenses for the full year 2012 to be in the range of $1.325 billion to $1.4 billion. This range includes a full year operating expense impact of all our recent acquisitions, including Calistoga, Arresto, Oceanside and, most recently, Pharmasset.
We expect non-GAAP SG&A expenses for the full year 2012 to be in the range of $1.225 billion to $1.3 billion, which includes the anticipated impact of Quad launch and a higher U.S. pharmaceutical excise tax expense. Our effective tax rate for the full year 2012 is expected to be in the range of 26% to 28% due primarily to the expiration of the federal R&D tax credit and the increase in the U.S. pharmaceutical excise tax, which is nondeductible reversible.
As detailed on Slide 24, we are anticipating a full year 2012 diluted EPS impact of acquisition, restructuring and stock-based compensation related expenses to be in the range of $0.31 to $0.34 per share. And finally, we anticipate the net interest impact associated with the Pharmasset transaction to be approximately $230 million for 2012, which is detailed on Slide 25.
I'll now turn the call over to Kevin to share more review regarding our 2011 commercial performance and our outlook for 2012.
Kevin B. Young
Thank you, Robin. I am very proud of the many accomplishments achieved by our commercial organization in 2011 and our results in Q4 bode well for a successful 2012. Especially encouraging were the U.S. Truvada and ATRIPLA Q4 year-on-year growth rates of 9% and 11%, respectively. These results reflect the final release of 2011 ADAP federal funds and the resulting 50% reduction in patient waitlists from that peak. HIV product revenues were unaffected by large wholesale inventory levels and non-retail purchasing was healthy yet in line with patient demand.
The key patient drivers of HIV growth also looked very encouraging for Q3 2011, our latest data point. In the U.S., the moving annual total number of anti-retroviral-treated patient remained strong at 9% and the median CD4 count at treatment initiation hit an all-time high of 347. We have also been pleased with the uptick of Complera since its U.S. approval and launch in August of last year. Our goal of bringing the combination product of Truvada and rilpivirine to market was to provide additional options to physicians and expand the total number of HIV patients receiving a single-tablet regimen. With this in mind, I'm delighted to say that since the launch of Complera, we are seeing a 37% growth in the number of prescriptions for patients starting on a single-tablet regimen. We hope to reproduce this performance in Europe as we roll out Eviplera during 2012. To date, we have begun supplying Eviplera in the U.K., Austria and Germany.
Moving on our exceptional performance in HIV in 2011, I'm pleased to say that we have a growing business outside our core antiviral franchise. 30% of net product revenues or over $1 billion came from AmBisome, Ranexa, Letairis and Cayston in 2011. Importantly, Letairis and Ranexa had year-on-year growth rates of 22% and 33%, respectively. As I think about 2012, the underlying drivers of HIV commercial growth continue to look robust. The scientific arguments in HIV to diagnose more patients and treat them earlier have never been stronger. Moreover, the reasons to be using single-tablet regimens are compelling both medically and practically.
During 2012, we will continue to rollout Complera around the world and subject to FDA approval will bring our third single-tablet regimen to individuals in the U.S. living with HIV. We feel confident that the Quad will become an important treatment option for HIV patients initiating therapy and will ultimately be positioned as a preferred therapy in U.S. and international treatment guidelines. Like the rest of the pharmaceutical industry, we will undoubtedly continue to see some headwinds in European markets. Nevertheless, the spectionist nature of Gilead products and the strength of the pharmacoeconomic arguments to treat HIV placed us in a strong position for future growth. We will look for opportunities to open up new operating affiliates as we have done successfully in recent years in Austria, Switzerland and Poland where we see sustainable and profitable businesses and healthcare systems that support breakthrough medicines.
Finally, like the rest of my colleagues, I strongly believe that the acquisition of Pharmasset is a transformational milestone for Gilead. The worldwide potential for all oral antiviral pan-genotypic HCV cure is sizable with over 12 million infected individuals in commercial markets alone. We are already in high gear preparing global launch plans that will bring GS-7977 expeditiously to patients around the world. Our established relationships with the hepatologist and gastroenterologist via Viread HPV, our knowledge of liver disease payers and policy makers and the exciting potential of leveraging our HIV resources to expand HCV-provided capacity is a galvanizing prospect. And I am confident the Gilead commercial organization will rise to the occasion.
I will now hand the call over to Norbert Bischofberger. Norbert?
Norbert W. Bischofberger
Thank you, Kevin. For HIV, in the fall of last year, we provided positive top line results from the 2 pivotal Phase III studies comparing Quad with 2 current standard-of-care regimens, ATRIPLA in Study 102 and atazanavir boosted by ritonavir with Truvada in Study 103. In both cases, at 48 weeks, Quad proved to be non-inferior to the standard-of-care regimens. The 90% response rate observed on the Quad arm in Study 103 is the highest response rate seen in any large, blinded, randomized study of HIV patients. The 48-week results for both pivotal studies were accepted for presentation at the Conference on Retroviruses and Opportunistic Infections or CROI taking place in Seattle, March 5 through 8. Study 102 will be the subject of an oral presentation in Study 103 of a poster.
Across all our HIV programs, there will be at least 45 presentations at CROI, highlighting the important role of Gilead products in the treatment of HIV infection. In the U.S., the NDA application for Quad has been accepted by FDA for standard review with a PDUFA date of August 27. In addition, FDA indicated that a panel will be convened in the May timeframe to provide expert advice on the application. In Europe, we anticipate that EMEA will complete the review by the end of this year.
To further define the profile of the Quad, we have initiated three 48-week Phase IIIb studies to reevaluate switching of biologically suppressed patients from ATRIPLA to Quad in one study from Truvada plus a protease inhibitor to Quad and the other and from raltegravir plus Truvada to Quad in the third study. We expect data from all 3 studies to be available by late 2013. The Quad filing will be followed by regulatory filings this year for the single agent of elvitegravir and cobicistat. The filing for elvitegravir will be supported by Study 145 comparing elvitegravir to raltegravir in treatment-experienced patients. 96-week data indicating non-inferiority of the 2 arms were released in 2011.
The cobicistat filing will be supported by study 114, a Phase III study comparing cobicistat to ritonavir, both in combination with atazanavir and Truvada. We have released top line results from this study, which also met its 48-week primary objective of non-inferiority.
Last week, we announced the initiation of a Phase II clinical trial evaluating GS-7340 for the treatment of HIV infection in treatment-naïve adults. This 150-patient Phase II study will evaluate GS-7340 as a part of a once-daily, co-formulated, single-tablet regimen that will also contain cobicistat, elvitegravir and emtricitabine and will be compared to our Quad single-tablet regimen.
Moving to cardiovascular. Ranexa appears unique among anti-angina agents, because in addition to reducing ischemia in angina, there's evidence that it also lowers HbA1c, the biomarker for type 2 diabetes. 30% to 40% of coronary artery disease patients also have type 2 diabetes. Hence, these patients could potentially derive a bold benefit from Ranexa. In order to further define this potential benefit, we've initiated a Phase III program that includes 3 studies involving approximately 400 patients each to determine the effect of Ranexa alone or in combination with other antidiabetic therapies in lowering HbA1c and plasma glucose after 24 weeks of treatment. Confirmation of the antidiabetic effect of ranolazine in these studies could lead to a new indication of ranolazine for the treatment of type 2 diabetes.
Another opportunity for Ranexa is it's used in conjunction with percutaneous coronary intervention or PCI to prevent subsequent major adverse outcomes. A subgroup analysis of MERLIN, a 7,000-patient study of Ranexa in acute coronary syndrome indicated that Ranexa treatment resulted in a reduction of major adverse cardiovascular events in patients with a history of angina undergoing PCI. A Phase III study has started to further define the potential benefit of Ranexa post-PCI. In this trial, 2,600 patient with the history of angina undergoing PCI with incomplete revascularization will be randomized to Ranexa or placebo with the end point of major adverse cardiovascular events.
On the oncology front, in further strengthening of R&D management, Roy Baynes has joined the Gilead team as Senior Vice President, Oncology Therapeutics. Roy joined us from Amgen where he served as Vice President, Global Development and Therapeutic Area Head for Hematology Oncology. Throughout his tenure there over the last decade, he helped the Clinical Development and Medical Affairs teams responsible for the approval and launch of numerous hematology and oncology products.
Gilead has acquired promising oncology assets over the last couple of years and voice leadership will be important in bringing these novel candidates to market. GS-1101 went into Phase III development this quarter with studies in chronic lymphocytic leukemia. In addition, patients are being involved in 3 Phase II studies of the monoclonal antibody, GS-6624. These Phase II studies are evaluating the efficacy and safety of 2 different doses of GS-6624 in myelofibrosis, pancreatic and colorectal cancers. The pancreatic and colorectal cancer studies are both randomized, blinded studies comparing 6624 versus placebo when added to the standard of care in second line metastatic disease. In addition, 6624 is also being evaluated in a Phase Ib study in IPS and in a Phase II study for liver fibrosis and HCV-infected patients.
And finally, turning to liver disease. John, Robin and Kevin have all mentioned the important acquisition of Pharmasset. We are proceeding with the Pharmasset Phase III development plan for GS-7977 in genotype 2 and 3 patients. This program consists of 2 studies, 1 in treatment-naïve patients with patent interferon ribavirin as the control arm, the second in interferon intolerant in eligible patients with placebo as the control arm. I'm pleased to report that the treatment-naïve study was initiated in mid-December, and since then, we have screened 145 patients. This trial is the rate-limiting study for filing because of the 24-week duration standard-of-care arm. Due to the great interest and fast enrollment, we anticipate that these 2 Phase III studies will reach target enrollment in the United States before we will be able to activate sites in other geographies.
As you know, results from the ELECTRON study were presented by Pharmasset at AASLD last October where GS-7977 and ribavirin for 12 weeks resulted in 10 out of 10 cures in genotype 2/3 patients. We're awaiting data from multiple studies in genotype 1 patients specifically from the ELECTRON study, which involve genotype 1, both treatment-naïve and null responders, as well as on the QUANTUM study, which involve genotype 1 treatment-naïve patients. We received news this week that our late breaker abstract has been accepted to CROI for 2 cohorts of genotype 1 HCV-infected patients from the ELECTRON study null responders and treatment naïve patients. In both cohorts of that study, all patients treated with GS-7977 and ribavirin achieved undetectable viral load at 4 weeks on treatment, also known as rapid biological response or RVR.
By the time we present those results, we will have 4 weeks of staying by watching for the response data or SVR4 from the nonresponder patients. Many of you noticed, but it's important to reiterate that RVR reflects biological response on treatment. However, the important measure of response and the accepted Phase III endpoint is SVR12, which is a sustained biological response 12 weeks after end of treatment. SVR4 data are a reasonable proxy for SVR12 as most patients that rebound after treatment discontinuation do so in the first 4 weeks.
We also anticipate that we will have a significant presence at the European Liver Conference taking place in Barcelona in April with over 17 submitted abstracts from our HCV effort alone. As Gilead has pioneered in HIV, we expect to bring forward next generation single type of regimens for the treatment of hepatitis C also. To that end, drug interactions will be carried out with 7977 and GS-5885 and other internal candidates, which will be followed by Phase II clinical studies.
In closing, the investments we're making today, both in our broad and promising internal R&D efforts we have embarked upon, will continue to drive the success of our business in the future. I would now turn over the call to John Martin. John?
John C. Martin
Thank you, Norbert. As you have heard, we met a number of important milestones in 2011 that were achieved as a result of all the hard work of Gilead employees over the last several years. This momentum is continuing into 2012. For HIV, we will continue to benefit from the evolution of the U.S., European and international guidelines that support earlier diagnosis and treatment as well as the growing appreciation for the benefits provided by single-tablet regimens. In 2006, the Centers for Disease Control and Prevention suggested HIV testing as part of routine medical care in order to decrease the incidence of new infections. This benefit has now been quantified in study HPTN 052, demonstrating that HIV treatment results in 96% reduction of HIV transmissions in serodiscordant couples. The publication of this work in the New England Journal of Medicine was recognized in December as the Breakthrough of the Year by Science Magazine. The high efficacy demonstrated in HPTN 052 has ended the debate on the value of treatment as prevention.
In summary, we look forward to adding to the strength of our HIV business with our growing pipeline in cardiopulmonary, oncology and liver disease. As we enter our 25th year, I believe that the health of our company has never been stronger with prospects for exceptional growth for many years to come.
Idenix gets good news on hep C trial, but can't compete with Gilead
Idenix put out the news this morning that the FDA had lifted a partial hold on its hepatitis C drug IDX184--and then watched its share price slide.
In a sign of just how volatile the whole hepatitis C arena has become after back-to-back blockbuster buyouts, the key focus today is on Gilead's ($GILD) surprise acknowledgement that its new hep C favorite scored promising numbers for the genotype 1 patient population. Indenix ($IDIX) and Achillion ($ACHN)--the other biotech most frequently mentioned as a likely takeover target--suffered from the comparison.
"After review of the interim safety and antiviral activity results from the IDX184 phase IIb clinical trial, the FDA removed the partial clinical hold and has allowed us to continue enrollment of this study," says Idenix CEO Ron Renaud. "Importantly, this allows us to expand the phase IIb program and evaluate IDX184 in interferon-free combination regimens with other direct-acting antivirals. We are working toward beginning all-oral combination trials as quickly as possible."
Expanded trial, all oral, interferon-free--all good things in the hepatitis C world.
As MarketWatch noted a couple of days ago, investors have been bidding up shares of Idenix and Achillion in the hope that they can profit from some other premium buyout. William Blair analyst Katherine Xu told the wire service that any Idenix buyout would likely be put on hold until after that pesky partial hold was lifted. But for a few hours anyway, Idenix's good news can't compete with promising data from Gilead.
- read the press release- get the story from MarketWatch
Gilead Gains on Positive Data From Experimental Hepatitis C Drug
In a sign of just how volatile the whole hepatitis C arena has become after back-to-back blockbuster buyouts, the key focus today is on Gilead's ($GILD) surprise acknowledgement that its new hep C favorite scored promising numbers for the genotype 1 patient population. Indenix ($IDIX) and Achillion ($ACHN)--the other biotech most frequently mentioned as a likely takeover target--suffered from the comparison.
"After review of the interim safety and antiviral activity results from the IDX184 phase IIb clinical trial, the FDA removed the partial clinical hold and has allowed us to continue enrollment of this study," says Idenix CEO Ron Renaud. "Importantly, this allows us to expand the phase IIb program and evaluate IDX184 in interferon-free combination regimens with other direct-acting antivirals. We are working toward beginning all-oral combination trials as quickly as possible."
Expanded trial, all oral, interferon-free--all good things in the hepatitis C world.
As MarketWatch noted a couple of days ago, investors have been bidding up shares of Idenix and Achillion in the hope that they can profit from some other premium buyout. William Blair analyst Katherine Xu told the wire service that any Idenix buyout would likely be put on hold until after that pesky partial hold was lifted. But for a few hours anyway, Idenix's good news can't compete with promising data from Gilead.
- read the press release- get the story from MarketWatch
Gilead Gains on Positive Data From Experimental Hepatitis C Drug
QBy Ryan Flinn - Feb 2, 2012 8:24 PM ET
Gilead Sciences Inc. (GILD), the drugmaker that acquired Pharmasset Inc. last month for its experimental hepatitis C treatments, gained in extended trading after saying one of the therapies produced positive clinical trial results.
Patients with genotype 1 hepatitis C -- the most common in North America -- had no detectable signs of the virus after four weeks on the drug, PSI-7977, Norbert Bischofberger, Gilead’s chief scientific officer, said today on the Foster City, California-based company’s earnings call. An earlier study of the medicine, gained in the $10.8 billion Pharmasset purchase, cured all patients with genotype 2 and 3.
Drugmakers including Gilead, Merck & Co., Vertex Pharmaceuticals Inc. and Bristol-Myers Squibb Co. (BMY), are striving to develop a new class of oral cures for hepatitis C to replace older drugs that require injections. Bristol-Myers recently agreed to spend $2.5 billion to buy Inhibitex Inc. (INHX) for its experimental hepatitis C therapies.
“It looks like Gilead will race ahead and continue to lead because its drug 7977 continues to support potential 100 percent cure rates,” Michael Yee, an analyst with RBC Capital Markets in San Francisco, said in an interview. “The data disclosed in genotype 1, an important population for which there was no good data yet, continues to show they can support a multibillion-dollar drug franchise with 7977.”
The drug was tested in combination with ribavirin, a medication currently used in treating the disease. The therapy was given to patients who hadn’t taken other drugs and those whose illness wasn’t helped by other treatments.
The company will present further data on the clinical trial at an infectious diseases conference next month in Seattle.
Gilead rose as much as 6.4 percent to $52.45 after closing at $49.31 in New York trading.
To contact the reporter on this story: Ryan Flinn in San Francisco at rflinn@bloomberg.net
To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net
Fri, Feb 3, 2012
An experimental drug combination to cure hepatitis C has produced positive clinical trial results, revealed Gilead Sciences during its quarterly conference call.
The announcement overshadowed the company's 4th quarter earnings and outlook which were mostly disappointing.
The company's chief researcher, Norbert Bischofberger, disclosed that genotype 1 hepatitis C patients treated with the combination of experimental pill GS-7977 and ribavirin showed no signs of the virus after four weeks of treatment.
The results put Gilead ahead of other drug companies looking for a way to replace injections with an oral regimen against hepatitis C. The same treatment was already known to be effective against genotypes 2 and 3. Gilead had acquired the rights to GS-7977 (formerly PSI-7977) through its $10.8 billion acquisition of Pharmasset.
More clinical trial data will be presented by Gilead at an infectious diseases conference next month in Seattle. Analysts note that the drug combination still needs to be submitted to the FDA for approval.
Left untreated, the hepatitis C virus can cause liver damage. It is the main cause of liver transplants in the United States.
Headquartered in Foster City, Gilead Sciences is a major biopharmaceutical company known its portfolio of drugs that treat HIV infections, liver disease and cardiovascular and respiratory ailments.
An experimental drug combination to cure hepatitis C has produced positive clinical trial results, revealed Gilead Sciences during its quarterly conference call.
The announcement overshadowed the company's 4th quarter earnings and outlook which were mostly disappointing.
The company's chief researcher, Norbert Bischofberger, disclosed that genotype 1 hepatitis C patients treated with the combination of experimental pill GS-7977 and ribavirin showed no signs of the virus after four weeks of treatment.
The results put Gilead ahead of other drug companies looking for a way to replace injections with an oral regimen against hepatitis C. The same treatment was already known to be effective against genotypes 2 and 3. Gilead had acquired the rights to GS-7977 (formerly PSI-7977) through its $10.8 billion acquisition of Pharmasset.
More clinical trial data will be presented by Gilead at an infectious diseases conference next month in Seattle. Analysts note that the drug combination still needs to be submitted to the FDA for approval.
Left untreated, the hepatitis C virus can cause liver damage. It is the main cause of liver transplants in the United States.
Headquartered in Foster City, Gilead Sciences is a major biopharmaceutical company known its portfolio of drugs that treat HIV infections, liver disease and cardiovascular and respiratory ailments.
Fatty Liver
A team of scientists from the University of Utah and the University of California at San Francisco has discovered that the mutation of a gene encoding a ketone body transporter triggers accumulation of fat and other lipids in the livers of zebrafish. This discovery, published in the Feb. 1, 2012, issue of Genes & Development, reveals that transport of ketone bodies out of the liver is a critical step in energy metabolism during fasting. It also provides a new approach for studying the development of fatty liver disease in humans.
Nonalcoholic fatty liver disease (NAFLD), or abnormally high accumulation of lipids in the liver, is the most common cause of chronic liver disease worldwide. Lipids are a broad group of molecules that include fats, triglycerides, and cholesterol. In some people, NAFLD causes no complications, but in others, excess fat in the liver can lead to inflammation or development of scar tissue, resulting in permanent liver damage or even liver failure. NAFLD may also increase the risk of heart disease in people who are overweight or obese. The increasing prevalence of NAFLD in the United States is due, in large part, to the obesity epidemic and it is estimated that more than 6 million U.S. children already have fatty liver disease.
"Currently, there are a limited number of treatment options for decreasing excess fat in the liver and there are no methods for reversing damage to liver tissue due to NAFLD," says Amnon Schlegel, M.D., Ph.D., investigator in the University of Utah Molecular Medicine program, assistant professor of internal medicine at the University of Utah School of Medicine, and senior author on the study. "By identifying and characterizing novel genes that regulate accumulation of lipids in the liver, we may be able to gain new insight into the physiological processes that lead to NAFLD."
Previous research has shown that many of the proteins known to control lipid metabolism in humans are also present in zebrafish. Schlegel and his colleagues began by identifying a zebrafish mutant known as red moon (rmn), which developed abnormal lipid accumulation in liver cells, without evidence of associated liver inflammation or liver damage, when exposed to fasting conditions. Schlegel and his colleagues then used a molecular genetic technique called positional cloning to isolate the gene disrupted by the rmn mutation. They found that the rmn mutation inactivated slc16a6a, a gene thought to encode a protein required in the transport of nutrients during fasting.
"Until now, the activity of the Slc16a6a protein has not been functionally characterized in any organism," says Schlegel, who's also an adjunct assistant professor of biochemistry at the U medical school. "Our studies indicate that Slc16a6a is a protein involved in the transport of β-hydroxybutyrate."
β-hydroxybutyrate is a ketone body, a compound that is produced in the liver when blood glucose is low and fatty acids are broken down for energy. During periods of fasting, most body tissues can use fatty acids as an energy source, but the brain relies on β-hydroxybutyrate and other ketone bodies for fuel. Schlegel and his colleagues discovered that, in rmn mutants deprived of nutrition, loss of Slc16a6a function disabled secretion of ketone bodies from liver cells and increased lipid accumulation in the liver. They also found that introducing the human form of the SLC16A6 protein into rmn mutant livers restored ketone body secretion.
"Our research has uncovered a previously unrecognized, but critical step, in the complicated physiology of fasting," says Schlegel. "We still don't know whether altered fasting liver metabolism influences the development of NAFLD, but knowing that Slc16a6a is required for secretion of ketone bodies from liver cells during fasting may have implications for our understanding and treatment of other medical conditions where ketone bodies play a role. These include uncontrolled type 1 diabetes, obesity, and childhood metabolic disorders caused by defects in fatty acid metabolism."
Of Interest
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Triglyceride levels predict stroke risk in postmenopausal women.
Study finds biomarker to be more accurate than traditional cholesterol risk factors in predicting stroke
NEW YORK, February 2, 2012 – Postmenopausal women may be at higher risk of having a stroke than they think.
A new study by researchers at NYU Langone Medical Center and colleagues found that traditional risk factors for stroke – such as high cholesterol – are not as accurate at predicting risk in postmenopausal women as previously thought. Instead, researchers say doctors should refocus their attention on triglyceride levels to determine which women are at highest risk of suffering a devastating and potentially fatal cardiovascular event. The study appears online today in the journal Stroke.
"Every year, hundreds of thousands of people are affected by stroke and there is a tremendous emphasis on identifying people at increased risk," said lead author Jeffrey S. Berger, MD, assistant professor of medicine and director of Cardiovascular Thrombosis at NYU School of Medicine, part of NYU Langone Medical Center. "This study revealed that what we've been using to evaluate risk all these years actually has little to no predictive value in older women. Triglyceride levels, however, take on a new significance. "
According to the U.S. Centers for Disease Control and Prevention, nearly 800,000 Americans suffer a stroke each year. Ischemic strokes, the type assessed in this study, account for more than eight out of every ten strokes. They occur when blood clots, developing from high levels of a waxy substance in the blood called cholesterol, obstruct blood vessels to the brain. Cholesterol is made up of several lipids, or lipoproteins. Triglycerides are one type of such a lipoprotein, while others include low-density lipoproteins (LDL) and high-density lipoproteins (HDL)."
"We've always believed that total cholesterol and LDL cholesterol levels were the most important biomarkers for identifying stroke risk, but this study gives us strong evidence to question that approach," Dr. Berger said.
The researchers analyzed data from the Hormones and Biomarkers Predicting Stroke (HaBPS) study, consisting of women enrolled in the Women's Health Initiative (WHI), a landmark National Institutes of Health-sponsored study that has monitored the health of more than 90,000 postmenopausal women nationwide for more than 15 years. HaBPS is comprised of the first 972 women who experienced an ischemic stroke while participating in the WHI. These women were matched with a control group of 972 participants who had not had strokes. All the women had donated blood samples when they first enrolled in the WHI, and these samples were then analyzed for differences in lipid biomarkers.
The most compelling finding, according to Dr. Berger, was that high triglyceride levels were significantly associated with the development of stroke. In fact, women in the highest quarter of baseline triglyceride levels were nearly twice as likely to have suffered an ischemic stroke as women in the lowest quarter of triglyceride levels during the course of the study. Surprisingly, LDL cholesterol and total cholesterol, however, were not associated with stroke risk in this population, despite their perceived value in the medical community.
Whether the strong association between triglycerides and stroke would also be seen in other populations is still unknown. "This is only the first step. It's a really important step, but it's not the end of the story," Dr. Berger said. "While this study identifies subjects at increased risk of ischemic stroke, the long term goal is to reduce that risk. Future studies aimed at lowering triglyceride levels for reducing the risk of stroke are warranted."
About NYU School of Medicine:
NYU School of Medicine is one of the nation's preeminent academic institutions dedicated to achieving world class medical educational excellence. For 170 years, NYU School of Medicine has trained thousands of physicians and scientists who have helped to shape the course of medical history and enrich the lives of countless people. An integral part of NYU Langone Medical Center, the School of Medicine at its core is committed to improving the human condition through medical education, scientific research and direct patient care. The School also maintains academic affiliations with area hospitals, including Bellevue Hospital, one of the nation's finest municipal hospitals where its students, residents and faculty provide the clinical and emergency care to New York City's diverse population, which enhances the scope and quality of their medical education and training.
Additional information about the NYU School of Medicine is available at http://school.med.nyu.edu/.
Inspirational
Maine girl home after 6-organ transplant
(CBS/AP) Nine-year-old Alannah Shevenell is home from a Boston hospital with six new organs. The 9-year-old Maine girl received a new stomach, liver, spleen, small intestine, pancreas, and part of an esophagus to replace the ones that were being choked by a huge tumor. It's believed to be the first-ever transplant of an esophagus and the largest number of organs transplanted at one time in New England.
In 2008, Alannah, then 5, began running a fever and losing weight while her belly swelled. Doctors discovered a tumor that year and twice attempted to remove it, as it made it spread from organ to organ. But it was difficult to reach what turned out to be a rare form of sarcoma, said Debi Skolas, Alannah's grandmother, and chemotherapy didn't do the trick.
The growth - known as an inflammatory myofibroblastic tumor - continued to grow in her abdomen, causing pain, making it hard to eat and causing Alannah to swell up with fluid. Surgery was the last resort to save her life, and Alannah spent more than a year on a waiting list for the organs, said Dr. Heung Bae Kim, the lead surgeon on the procedure at Children's Hospital Boston.
The family was told there was a 50 percent chance Alannah wouldn't survive the procedure - but without it, she had no chance whatsoever.
In October, doctors prepared to remove the growth and the organs in one fell swoop and replace them with organs transplanted in one tangled piece from another child of similar size.
The hardest part was taking out her organs and the tumor, Kim said, calling it a difficult operation with lots of blood loss.
"It's probably one of the most extensive tumor removals ever done," the surgeon said.
Dr. Allan Kirk, professor of surgery at Emory University in Atlanta and the editor-in-chief of The American Journal of Transplantation, said no other esophageal transplant has been reported in medical literature.
After the surgery, Alannah spent three more months at the hospital. She battled infections and complications from the surgery before finally being given the OK to leave.
Healthy, active, and with high hopes, Alannah said Thursday that she's glad to be feeling well again and able to go sledding, make a snowman, work on her scrapbooks and give her grandmother a little good-humored sass.
The best part? "Being home," she said. "Just being home."
Even at home, Alannah has to take nine medications each day, some two, three or four times. Her grandparents have to precisely measure what goes in and comes out of her body, and check her blood sugar.
She has an ostomy pouch - a prosthetic device that collects waste - and a feeding tube attached to her for nutrition as she slowly gets used to eating again.
Her immune system is so weak that she can't go to places with large numbers of people. She can't eat raw vegetables or fruits unless they have thick skins because of concerns over germs, and she'll never be able to swim in a lake because of the bacteria.
WebMD has more on organ transplants.
The Hidden Outbreak: Why Restaurants Stay Anonymous
By CINDY GALLI and BRIAN ROSS (@brianross)
In 2008, Alannah, then 5, began running a fever and losing weight while her belly swelled. Doctors discovered a tumor that year and twice attempted to remove it, as it made it spread from organ to organ. But it was difficult to reach what turned out to be a rare form of sarcoma, said Debi Skolas, Alannah's grandmother, and chemotherapy didn't do the trick.
The growth - known as an inflammatory myofibroblastic tumor - continued to grow in her abdomen, causing pain, making it hard to eat and causing Alannah to swell up with fluid. Surgery was the last resort to save her life, and Alannah spent more than a year on a waiting list for the organs, said Dr. Heung Bae Kim, the lead surgeon on the procedure at Children's Hospital Boston.
The family was told there was a 50 percent chance Alannah wouldn't survive the procedure - but without it, she had no chance whatsoever.
In October, doctors prepared to remove the growth and the organs in one fell swoop and replace them with organs transplanted in one tangled piece from another child of similar size.
The hardest part was taking out her organs and the tumor, Kim said, calling it a difficult operation with lots of blood loss.
"It's probably one of the most extensive tumor removals ever done," the surgeon said.
Dr. Allan Kirk, professor of surgery at Emory University in Atlanta and the editor-in-chief of The American Journal of Transplantation, said no other esophageal transplant has been reported in medical literature.
After the surgery, Alannah spent three more months at the hospital. She battled infections and complications from the surgery before finally being given the OK to leave.
Healthy, active, and with high hopes, Alannah said Thursday that she's glad to be feeling well again and able to go sledding, make a snowman, work on her scrapbooks and give her grandmother a little good-humored sass.
The best part? "Being home," she said. "Just being home."
Even at home, Alannah has to take nine medications each day, some two, three or four times. Her grandparents have to precisely measure what goes in and comes out of her body, and check her blood sugar.
She has an ostomy pouch - a prosthetic device that collects waste - and a feeding tube attached to her for nutrition as she slowly gets used to eating again.
Her immune system is so weak that she can't go to places with large numbers of people. She can't eat raw vegetables or fruits unless they have thick skins because of concerns over germs, and she'll never be able to swim in a lake because of the bacteria.
WebMD has more on organ transplants.
Healthy You
The Hidden Outbreak: Why Restaurants Stay Anonymous
By CINDY GALLI and BRIAN ROSS (@brianross)
Feb 3 2012
After a certain fast food chain was linked to an outbreak of salmonella that sent at least 20 people to the hospital last year, food safety officials decided it wasn't necessary to tell consumers which restaurant was allegedly involved.Read More Here
In fact, in dozens of cases after the outbreaks were over, the Food and Drug Administration and Centers for Disease Control kept the names of restaurants that were part of investigations secret, apparently for fear of damaging their relationships with the companies...
In the most recent case, Food Safety News revealed Wednesday that a mysterious "Mexican-style" restaurant chain linked to an October 2011 salmonella, only identified as "Restaurant Chain A" in official documents, was actually the popular fast food restaurant Taco Bell.
Taco Bell Response to Oct-Nov 2011 CDC Investigation
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