Gilead Sciences’ Hepatitis C Drug Candidate May Have First Mover Advantage

(By R Chandrasekaran)

 

While analysts and the market are encouraged by Gilead Sciences' Hepatitis C moving into the third phase of trial, what makes the company's advancement interesting are the delays of a similar programs by its rivals.  

Recently, drug maker Bristol-Myers Squibb suspended a clinical trial of a similar drug as a result of new safety issues. 

Gilead's GS-7977 with genotype 2/3 is an easier one to treat Hepatitis C and the drug, in combination with generic ribavirin, could get its initial approvals next year. In an equity research note to clients, S&P Capital IQ equity analyst Steven Silver viewed, "We see GS-7977 being combined with GILD's internal candidate GS-5885 in the more challenging genotype 1, including those patients who failed on previous treatments, in 2013. If successful, we expect the regimen to be filed for regulatory approval in 2014, and launched in 2015." 

The first company to get approval for the next generation drug for treating Hepatitis C will have a major first mover advantage in the market. This is because physicians are progressively deferring to treat patients with available, approved drugs.  

This was quite evident when Vertex Pharmaceutical's (Nasdaq: VRTX) Incivek witnessed 8.1 percent downside in U.S. sales during the second quarter. The drop in sales of Incivek is close to 30 percent when compared with the fourth quarter's $457 million in 2011. Interestingly, Vertex management blamed the demand downturn to more Hepatitis C patients being warehoused for future treatment with newer regimen such as GS-7977. The treatment period in the new drug candidate is shortened to 12 weeks versus 24 – 48 weeks standard time.

 

 

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