Okairos AG begins mid-stage trial of preventative vaccine for HCV...

Posted 3/14/12 via Bloomberg.com .  Swiss company Okairos AG begins mid-stage trial looking a what it hopes to be the first preventative vaccine for the Hepatitis C virus. 

Former Merck Unit Works on First Vaccine for Hepatitis C
By Makiko Kitamura - Mar 14, 2012 1:00 AM PT

Okairos AG, a biotechnology business that Merck & Co. (MRK) sold to venture capital funds in 2007, is seeking to produce the first preventive vaccine for hepatitis C, challenging makers of treatments for the disease.

Okairos has begun a mid-stage study, funded by the U.S. National Institutes of Health, of a gene-based vaccine designed to stimulate the body’s immune system to prevent hepatitis C from taking hold, Chief Operating Officer Tom Woiwode said in a phone interview from the company’s Basel, Switzerland, headquarters.

No vaccine exists for hepatitis C, which affects as many as 170 million people globally, putting them at risk of developing liver cancer, according to the World Health Organization. The growing population of patients infected with the virus spurred Gilead Sciences Inc. (GILD)’s decision in November to buy experimental hepatitis C-treatment maker Pharmasset Inc. for $10.8 billion and Bristol-Myers Squibb Co. (BMY)’s acquisition in February of Inhibitex Inc. for $2.5 billion.

“This could change the landscape quite a bit,” said Les Funtleyder, a health-care strategist and portfolio manager at Miller Tabak & Co. in New York. “In theory, if you could vaccinate everyone, you’d need a lot less drug.” Funtleyder said he isn’t aware of any other preventive vaccines in development.
Disease Transmission

Okairos’s vaccine would target those who may be at risk of infection. The disease is most commonly transmitted through contaminated blood transfusions, organ transplants, contaminated syringes and needle-injected drug use, according to the WHO.

Most preventive vaccines stimulate the production of antibodies, molecules produced by the immune system as part of the body’s defenses. Development of Okarios’s vaccine was triggered by studies of patients with early-stage hepatitis C, of whom about 20 percent spontaneously clear the virus and avoid advancing to the chronic phase, Woiwode said.

Researchers have found those patients tend to have a strong response in the blood’s T cells, Woiwode said. Armed with that knowledge, Okairos developed technology that delivers genetic material to stimulate T cells, the white blood cells that help the body fight diseases.

This approach contrasts with most other vaccines, which stimulate an antibody response, Woiwode said.

“We’ve opened up a new path that will allow us to address a number of diseases, hepatitis C being the first one,” he said in the interview yesterday.

Even if a vaccine is approved, medicines are needed to treat patients already infected, Miller Tabak’s Funtleyder said.

Industry Projects
Merck and Vertex Pharmaceuticals Inc. (VRTX) won approval last year for the first new therapies for hepatitis C in almost a decade. Johnson & Johnson (JNJ), a partner in the Vertex drug, is also cooperating with Swedish drugmaker Medivir AB (MVIRB) on a hepatitis treatment. Basel-based Roche Holding AG (ROG) agreed in October to buy Anadys Pharmaceuticals Inc., another maker of experimental medicines for hepatitis C, for about $230 million.

Profectus Biosciences Inc., a Baltimore-based vaccine manufacturer, is also developing a drug that prevents patients with early-stage hepatitis C from advancing to the chronic stage. The company plans clinical trials of the product in 2013.

Investors in Okairos, which is also developing malaria, cancer and flu vaccines, include Boehringer Ingelheim Venture Fund, Life Sciences Partners, Novartis Venture Funds and Versant Ventures. The Swiss company has also received grants from the European Union and the Bill and Melinda Gates Foundation.

The company is in discussions with potential partners for marketing the vaccine, Woiwode said.

“I have no doubt that if this Phase 2 study is successful, there will be no shortage of interest to work with us to bring this to the market globally,” he said.
To contact the reporter on this story: Makiko Kitamura in London at mkitamura1@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

Seeking Alpha: Addressing Vertex/Gilead Confusion...

Posted 3-1-2012 on Seeking Alpha.com: More on HCV drug development investment 'irrational exuberance', the author making a case that investors have given Vertex the bum's rush and should take another look. 

Addressing Vertex / Gilead Confusion
March 1, 2012
Contributor: Prohost Biotech

Hepatitis C virus (HCV) treatments are moving stocks of HCV developers up and down in a chaotic way that makes no sense. While Vertex’ (VRTX) Incivek sales have been breaking the record of drug sales, investors who have been fed immature and unconfirmed knowledge that Pharmasset’s oral HCV therapeutics combination will render Incivek obsolete caused a sell-off in VRTX. Investor logic that patients would definitely prefer all oral drugs over a combination that has injectable alfa interferon is undisputable, that’s we too are waiting for a successful all oral HCV treatment, which has yet to emerge.

With the media stressing that Pharmasset was the firm that will put the magic combination on the market, Pharmasset's stock doubled from over $20 in January 2010, to around $45 at the end of December. In 2011, the stock rallied again from $45 in January to $135 in August, split 2 to 1 and started climbing back from around $66 to $72. The firm was then acquired by Gilead (GILD), which paid an additional 67% premium over its obese market price, i.e., around over $130 per share.

This scenario does not make sense to us. Contrary to the market’s culture, investors, for one reason or another, sold a real present to buy a future designed on mere speculation. They sold VRTX, a company that had a marketed HCV drug, which is the first ever to represent a cure for the life-threatening HCV infection and whose sales have been actually generating record revenues to buy into Pharmasset’s oral combination while still in mid-trial and requires more lengthy experimentation before confirming the all-oral combination’s safety and long-term efficacy.

Just before concluding the acquisition deal, on December 16, 2011, Pharmasset surprisingly announced its decision to discontinue all treatment arms with a regimen containing its drug PSI-938 because of laboratory abnormalities associated with liver function in subjects receiving the drug at a dose of 300 mg/day. This news surprised investors, especially Gilead’s shareholders who began to question the value of the deal with Pharmasset. The news did not alter Gillead’s decision to acquire the company. After the acquisition, Gilead’s stock experienced a temporary retreat. Many investors believed that $11 billion was an unprecedented high amount of money to be paid for molecules that have yet to complete clinical trials, confirming their superiority as described by the media since 2009. Investors’ temporary negative reaction toward the deal was the only understandable action in this story.

It did not take time for GILD to fiercely rebound after the firm announced its financial results. The stock was up to $56, matching its new high for the past three years. Less than two months later, though, other trial results with Pharmasset’s combination on HCV genotype 1 patients with a prior “null” response to an interferon-containing regimen demonstrated that the majority of patients experienced viral relapse within four weeks of completing 12 weeks of treatment with what has become Gilead’s combination of GS-7977 plus ribavirin (RBV). GILD tumbled, trading now at around $45, after loosing around 15% of its value.

In the mean time, Vertex is generating millions of dollars selling its selective HCV protease inhibitor. Its stock, though, remained boxed - sold every time it makes an attempt to rally even though Vertex is also trying its own all-oral combination. The stock remained boxed even after data from two treatment arms of the Phase 2 ZENITH study evaluating an interferon-free (all-oral) treatment regimen of the non-nucleoside polymerase inhibitor VX-222 in combination with INCIVEK (telaprevir) tablets and ribavirin in people with genotype 1a or 1b hepatitis C who were new to treatment have demonstrated promising safety and efficacy and after learning that the data from this study will be used to design a Phase 3 program with the goal of submitting a New Drug Application (NDA) to the FDA for the first interferon-free regimen for genotype 1 (1a and 1b) patients by the end of 2014 or beginning of 2015.

Investors didn’t even bother considering the fact that Vertex and its collaborator Alios BioPharma are conducting Phase 1 studies of two structurally-distinct nucleotide polymerase inhibitors, ALS-2200 and ALS-2158. Vertex has begun the first seven-day viral kinetic studies of ALS-2200 and ALS-2158 in people with genotype 1 hepatitis C, whose safety and viral kinetic data expected in the second quarter of 2012. Positive results would enable the initiation of Phase 2 studies in the second half of 2012 to evaluate multiple interferon-free combination regimens of ALS-2200, ALS-2158, INCIVEK, VX-222 and/or ribavirin.

What continued to make no sense at this stage is that investor pessimism with Gilead's all-oral combination that erased 15% of GILD price, did not transform into optimism for VRTX, which was cremated by the enthusiasm for Gilead’s drug that investors are now experiencing doubt about. It looks as if investors are sensitized to not appreciate the firm that introduced the first HCV cure and the first approved cystic fibrosis drug that works at the root cause of the disease, knowing in fact that Vertex has plans ready to bring breakthrough treatments to all cystic fibrosis patients.

Gilead is a great firm and at the end of the day it will probably succeed in bringing an HCV breakthrough treatment to the market. But this does not mean that Vertex will not succeed reaching the same goal. Vertex is also a great firm that has already changed the way chronic life-threatening diseases have been treated. Gilead has a lot of current and upcoming good news and so does Vertex. The HCV market is huge. It requires more than one, or two treatments to satisfy its needs.

Disclosure: We are long both firms.

The Motley Fool - Investors flee Inhibitex and Idenix stock on Pharmasset PSI-938 news...

Idenix Shares Plunged: What You Need to Know
By Evan Niu, The Motley Fool
Posted 3:59PM 12/16/11 Investing

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Idenix (NAS: IDIX) are plunging today, down by 16% at the low, after competitor Pharmasset (NAS: VRUS) discontinued use of one of its experimental drugs due to safety concerns.

So what: Pharmasset's experimental hepatitis C drug PSI-938 reported complications with liver function, although the developments aren't expected to interfere with Gilead Sciences' (NAS: GILD) planned acquisition of the company. Idenix also has a hepatitis C drug in its pipeline, which is the company's current focus.

Now what: The news is causing concern among some hepatitis C drugmakers, including Inhibitex (NAS: INHX) , which is also seeing downside today. Interestingly, rival Vertex Pharmaceuticals (NAS: VRTX) is seeing healthy gains, with setbacks for PSI-938 considered positive for Vertex. Idenix's and Inhibitex's hepatitis C drugs are more similar to Pharmassets, which is causing investors to flee for cover.

Xconomy.com: The Hepatitis C Market: Biotech’s Version of the Daytona 500

National Biotech Editor of Xconomy, Luke Timmerman likens the current HCV market to Daytona 500 vs a toe-to-toe slug fest between two competitors. Surprises lurk at every turn as a wide array of competitors, from Big Pharma to little Biotech upstarts vie to out-maneuver each other for the championship. This makes for trecherous ground for investors, as we know anything can happen and usually does in drug development. But for the patient suffering from HCV, all this is good news. Intense competition usually sparks innovation - we've already seen from the recent AASLD meeting that a possible all-oral regimen for HCV without the need for interferon may be a distinct possibility for some patients. possibly within 5 years. A good read whether you're an investor, treater or a patient.


Biotech rivalries are sometimes a bit like boxing matches, where you have two lone fighters vying for the prize. But the hepatitis C market is turning into a battle royal that’s more wide open and unpredictable, with all the competitive maneuvering, surprise crashes, and comebacks you might expect from the Daytona 500.

The medical advances in hepatitis C have been dizzying this year, especially in what it means in terms of multi-billion dollar business implications. The safest thing to say is that there’s plenty of good news for patients this year, but that shareholders in the major hepatitis C drug developers had better hold on tight as a new standard of care gets established.

Some commentators figured that Gilead Sciences (NASDAQ: GILD), the world’s biggest maker of HIV drugs, had essentially locked up the dominant position in this new drug class through its $11 billion acquisition last month of Princeton, NJ-based Pharmasset (NASDAQ: VRUS). But it’s still too soon for anyone to declare victory over the wily and fast-mutating virus that causes hepatitis C. Given the way drug development is going now, it’s possible we could have dueling antiviral drug cocktails that cure almost 100 percent of patients within five years. And before we get there, we’re going to see some fascinating chess moves—and probably a few surprising collaborations—from companies like Vertex Pharmaceuticals, Merck, Roche, Johnson & Johnson, Bristol-Myers Squibb, and Abbott Laboratories, as well as several smaller biotech startups like Alpharetta, GA-based Inhibitex (NASDAQ: INHX).

The Pharmasset compound that prompted Gilead to write such a big check, PSI-7977, is “certainly not a panacea, not the lone answer,” says Kleanthis Xanthopoulos, the CEO of San Diego-based Regulus Therapeutics, and the co-founder of another hepatitis C drug developer, Anadys Pharmaceuticals.


Regulus Therapeutics CEO Kleanthis Xanthopoulos

Xanthopoulos says Gilead was “taken to the cleaners,” and that the hepatitis C market is still up for grabs. “It’s going to take some time before people figure out how it plays out,” he says. The Pharmasset drug “is a powerful player, but you will need other direct-acting antivirals. You want to go to a 100 percent cure rate. I can guarantee the Pharmasset compound isn’t going to do it alone.”

Hepatitis C has never really captured big headlines in the U.S., as it has never benefitted from massive awareness boosting campaigns that have supported research for, say, HIV, or breast cancer. But hepatitis C has clearly emerged as one of the biggest opportunities in pharmaceuticals over the past few years. There are more than 3 million people in the U.S., and an estimated 170 million worldwide, with this liver infection that can lead to cirrhosis and liver cancer. Most people have never bothered to get treated, partly because the infection takes years to fully wreak havoc. The other reason is the standard of care with a combination of drugs—pegylated interferon alpha and ribavirin—causes flu-like symptoms that last for almost a year, and usually cures only 30-40 percent of patients. Essentially, most people figure the treatment is worse than the disease.

Vertex Pharmaceuticals changed the equation back in May. The company won FDA approval for a direct antiviral drug, a protease inhibitor called telaprevir (Incivek), that is added to the usual two-drug combo regimen. By adding the Vertex drug, researchers saw the cure rate boom to almost 80 percent of patients, while cutting the treatment time with the other drugs in half. The Vertex drug also significantly raised the cure rate for patients who failed to respond to prior rounds of therapy.

Vertex looked golden for a while, as its stock soared above $55 a share, sending its market value above $10 billion. Analysts were raving about how Vertex smashed sales expectations in its first few months on the market, and started turning profitable in just its second quarter of selling the drug. Waves of patients were suddenly showing up at doctors’ offices to get treatment for hepatitis C, now that the odds of a cure were so much higher.

But important as the Vertex advance has been, researchers have made it clear that this story isn’t over. The ultimate goal is to get rid of interferon, and its side effects, so that physicians can count on some combination of direct antivirals that can be taken as oral pills. That might include Vertex’s drug in combination with others, or might not.

So that’s why Vertex, and other companies, have feverishly been looking to mix and match various hepatitis C drugs. It’s all part of a quest to come up with the ideal combo that can raise the bar on cure rates, minimize side effects, and maximize convenience.

While people on Wall Street like to embrace a simple storyline with clear winners and losers, the hepatitis C virus is one tricky adversary. Like HIV, it has a tendency to mutate and develop resistance capabilities, whenever scientists throw a new antiviral drug against it. So there isn’t likely to be a single magic bullet. The most likely route to success is with a combination of two, three, or maybe four antiviral drugs that attack the virus from different angles, making it much harder for the bug to mutate and escape one drug.

As Steve Worland, the CEO of San Diego-based Anadys Pharmaceuticals, put it in a guest editorial for Xconomy in September, there are at least four important categories of hepatitis C antivirals. There are protease inhibitors on the market like Vertex’s drug and Merck’s boceprevir (Victrelis). There are nucleotide polymerase inhibitors like Pharmasset’s PSI-7977 and a rival drug called mericitabine from Roche. There are non-nucleotide polymerase inhibitors in the works from Abbott Laboratories, Vertex, and Anadys (which Roche acquired this fall for $230 million.) And Bristol-Myers Squibb is betting on another kind of compound, an NS5A inhibitor. (You could also count microRNA therapies, which Santaris Pharma and Regulus are working on at earlier stages of development.)

Just this year, we’ve seen some fascinating jockeying for position. Drug companies often don’t like to test combinations of experimental drugs together in clinical trials, because when side effects emerge, people often like to point the finger at the other guy’s drug. And who wants to divvy up the profits with some other pharma giant when you have the whole thing yourself?

But with hepatitis C, the market opportunity is so big, and the variety of drugs to attack it is so broad, that pharma companies have set aside those concerns just to get a piece of the action. We’ve already seen Merck and Roche form a partnership to co-market Victrelis against the leading drug on the market from Vertex. Gilead just shelled out the breathtaking sum of $11 billion for Pharmasset, even though the smaller company’s lead compound still has to navigate the third and final phase of clinical trials required for FDA approval. Bristol-Myers Squibb and Johnson & Johnson have teamed up in an interesting new collaboration. Roche, through internal efforts and acquisitions, has sought to put all the pieces of the puzzle together under one roof—a protease inhibitor, a nucleotide polymerase inhibitor, a non-nucleotide polymerase inhibitor.

Nobody knows which compounds will match up best together, which ones will be too toxic in combination, or even how many antivirals will be needed to raise the cure rate. But it’s worth noting that Vertex raised the bar very high, by getting cure rates up to around 80 percent. Doctors are certainly eager to get rid of the nasty interferon part of the regimen, but they will only do that when a new regimen can do at least as well on cure rates. And any of these drugs can be derailed by somewhat mild side effects, since the bar on safety is set quite high already.

It might be relatively safe and simple to declare Gilead/Pharmasset the winners in this market, but this race isn’t even close to over. There are 200 laps in the Daytona 500, and in the hepatitis C race, I’d say we’re at about lap 50. There are going to be some fascinating strategic maneuvers, and maybe even a spectacular crash or two, before somebody zooms in under the checkered flag.



Luke Timmerman is the National Biotech Editor of Xconomy, and the Editor of Xconomy Seattle. E-mail him at ltimmerman@xconomy.com or follow him on Twitter at twitter.com/ldtimmerman

Zacks Investment Research on HCV market....

Zacks analysis of the current HCV market and speculation of what's to come. Interesting read especially if you're new to the HCV drug development space.

Spotlight On Hepatitis-C Market
By Zacks Investment Research on December 6, 2011

Is the hepatitis-C market the next Mecca for the pharma/biotech sector? It seems so if we go by the flurry of activity and heightened interest in this market in the past few quarters. The hepatitis-C virus (HCV) market seems to have caught the eye of several pharma/biotech companies – as evident by the deals being signed for the development of drugs for the treatment of HCV.

We are talking about the recent announcements made by big players like Johnson & Johnson (NYSE:JNJ), Bristol-Myers Squibb (NYSE:BMY) and Gilead Sciences, Inc. (NASDAQ:GILD). All three companies have made it clear they want a piece of the HCV market pie.

Johnson & Johnson’s Tibotec Pharmaceuticals and Bristol-Myers Squibb recently announced that they have decided to join forces for the development of Bristol-Myers’ daclatasvir (BMS-790052) in combination with Tibotec’s TMC435, for the treatment of chronic HCV. What the partners are aiming to do is create an oral once-daily interferon-free cocktail treatment for HCV patients.

Bristol-Myers and Johnson & Johnson’s announcement comes on the heels of Gilead’s announcement regarding its intention to buy Pharmasset, Inc. (NASDAQ:VRUS), a company focused on developing HCV treatments. We think the main attraction for Gilead in this $11 billion deal is Pharmasset’s HCV pipeline. Lead candidate PSI-7977 is currently in two phase III studies, with a third phase III study scheduled to commence in the first half of 2012. Successful development could lead to US approval in 2014 thereby making Gilead a front-runner in the oral once-daily interferon-free cocktail treatment HCV market.

We note that both TMC435 and daclatasvir are being evaluated separately in combination with Pharmasset’s PSI-7977.

The Allure of the HCV Market

HCV is a hot development area which has come into the limelight with the launch of two new treatments – Vertex Pharmaceuticals’ (NASDAQ:VRTX) Incivek and Merck’s (NYSE:MRK) Victrelis. Both drugs gained approval in the US earlier this year. Incivek, which was launched in May 2011, posted a whopping $419.6 million in sales in the first full quarter of its launch.

So, with two new recently launched products in the market, why is the HCV market considered so attractive? Firstly, it is estimated that about 170 million people suffer from HCV infection across the world. However, the treated population is much lower. In major markets like the US, EU, Japan, Australia, Turkey, Canada, etc. only 200,000 HCV patients out of a total of more than 12 million are estimated to receive treatment each year. This means a huge number of HCV patients go untreated, leaving the field open for new treatments.

Secondly, the current standard of care comes with several side effects which make it difficult for patients to remain on treatment. A 48-week course of both peg-interferon (peg-INF – weekly injections) and ribavirin (RBV – oral drug), are the standard treatment for genotype 1 HCV infection. However, this treatment regimen is associated with significant side-effects like fatigue, flu-like symptoms, rash, depression and anemia.

With a large number of HCV patients failing to achieve a sustained viral response (SVR) on the current standard of care, there are several patients who would be open to treatment with new and potentially more effective therapies.

These factors have made the HCV market an attractive commercial opportunity for pharma and biotech companies. Victrelis and Incivek are examples of the changing treatment regimen in the HCV market. Both are protease inhibitors which when added to the standard of care reduce the treatment period and also improve the treatment outcome. However, both need to be administered with peg-IFN and RBV – this leaves the path open for the introduction of treatments with fewer side effects.

Cocktail Therapy – The Next Big Thing in HCV

Companies like Johnson & Johnson and Gilead are trying to develop the next crop of drugs, which are expected to change the treatment paradigm for HCV patients by providing them with all-oral treatment regimens. The aim is to develop a treatment which does not require the administration of interferon, thereby doing away with a whole range of side effects. The treatment duration will also be shorter.

Treatments being developed include HCV polymerase inhibitors and HCV NS5A inhibitors. The future HCV market will most likely consist of cocktail treatment regimens developed by combining different oral treatments.

Vertex Pharma has also recognized the need to continually evolve the HCV treatment pattern and is developing an all-oral combination of VX-222 (a polymerase inhibitor) and Incivek without peg-IFN.

Who Will Win the Rat Race?

With several companies pursuing cocktail therapies for HCV, it will be interesting to see which of these companies will be the first to hit the market with a new treatment option. Currently, it looks like Gilead might be the front-runner assuming the Pharmasset acquisition goes through.

The Motley Fool's Sean Williams on Inhibitex....

Inhibitex Shares Popped: What You Need to Know

By Sean Williams
December 1, 2011

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Inhibitex, one of many biotechnology companies involved in hepatitis C research, jumped as much as 13% earlier in the trading session before giving up almost all of its gains.

So what: Ever since Gilead Sciences agreed to purchase Pharmasset last week at a hefty premium, the sector has been abuzz with more buyout speculation. Optimists got more fuel for the fire earlier in the week when Inhibitex reported positive phase 2 results for INX-189, its experimental hepatitis C drug. Today's move appears to be a carryover effect of the bullishness from previous days.

Now what: To say that I'm not a fan of Inhibitex at its current valuation north of $1.1 billion might be an understatement. The company is going to face an onslaught of competition from Gilead and Pharmasset, but also from hep C drugs that are already approved by the FDA for sale, including Merck's Victrelis and Vertex Pharmaceuticals' Incivek. Then there's the fact that Inihibtex has already sold 1.9 million shares of stock into this unbelievable rally. With its leading drug candidate only in phase 2 clinical trials, there are plenty of moves left to be played in this chess game before I'd declare Inhibitex a winner. I'm so confident Inhibitex is overvalued at these levels I'm willing to bet my CAPS points on it!

The Motley Fool's Brian Orelli waxes on "HCV Warehousing 2.0"...

I don't know why, but I love reading what analysts are thinking. The touchstone is always 'hyperbole', either bear or bullish. Unfortunately, investment-related articles like this may impair what would be otherwise logical, pragmatic thinking by HCV patients and treatment providers. Orelli happens to be right about an upcoming new wave of warehousing patients for more effective...and hopefully more tolerable...medications to treat Hepatitis C, and for all the wrong reasons. Don't succumb to hype. Outside of a patient being contraindicated for treatment or some other serious life issue, there's no reason to wait 2 1/2 - 3 years for new treatments that might/might not actually make it to market. The HCV drug development landscape is polluted with once-promising drugs that never made it out of Phase II trials. What we know about HCV is that the progression of disease can be slow, but it's also non-linear. Because a patient with HCV has a fibrosis score of '0' today, doesn't mean the patient won't advance to a '3' by 2014. We also know that the more advanced the disease, the less effective the medications are likely to be. The best bet is to get treated, and the earlier the better

The Biggest Fear for Hep C Investors

By Brian Orelli
November 28, 2011

There's no doubt about it -- the hepatitis C market is huge. There are 3.2 million people in the U.S. alone infected with the virus, according to the Centers for Disease Control and Prevention.

But one of the reasons for the large number of patients could be the downfall for hepatitis C drugmakers.

Hepatitis C is a chronic disease that's slow to progress. It eventually causes liver problems including scarring of the liver or liver cancer, but that's often years after the initial infection. In fact, many of those 3.2 million Americans don't even know they're infected.

The slow progression of the disease allowed doctors to put off treatment, called warehousing, and wait for Merck's Victrelis and Vertex Pharmaceuticals' Incivek to work their way through the drug-development process. The previous generation of treatment options -- Merck's PegIntron and Roche's Pegasys -- cure only around half of the patients and had nasty side effects that weren't all that appealing, considering the flip-of-a-coin chance at a cure.

Warehousing 2.0
Clearly, many doctors and their patients have decided that they've waited enough. Incivek is off to a blustering start, registering $420 million in sales during its first full quarter on the market.

But Incivek isn't perfect. It still requires patients to take PegIntron or Pegasys, albeit for a shorter duration of time than it was used when the drugs were taken on their own. Multiple companies are going after an interferon-free regimen that would be taken orally.

Pharmasset, which is being bought by Gilead Sciences, has a hepatitis C drug candidate, PSI-7977, which looks good so far as an interferon-free treatment. Gilead has other hepatitis C drug candidates it's developing that could be used in combination with PSI-7977 if it doesn't work on its own. And there are plenty of other drugmakers, including Achillion (Nasdaq: ACHN ) , Inhibitex (Nasdaq: INHX ) , Vertex, Merck, Johnson & Johnson, and Bristol-Myers Squibb (NYSE: BMY ) , developing other hepatitis C drugs that they hope can be part of an interferon-free cocktail.

It seems entirely possible that doctors will continue warehousing all but the most-progressed patients until there's an interferon-free treatment regimen that works as well as or better than the current standard of care. If that occurs, the peak sales of Incivek would be substantially diminished.

And then ...
If patients are going to wait for all-oral interferon-free regimens, why not wait until the drugs become generic and save some money? Granted, it'll take a while to get to that stage; patients being seen by doctors right now aren't likely to be thinking that way, but it seems entirely possible that the effective patent life of hepatitis C drugs could be cut short by a few years as patients considering treatment within a few years of patent expiration might just elect to wait.

And of course, at some point, the hepatitis C market will begin to shrink. Unlike HIV drugs that aren't really a cure, hepatitis C drugs rid the patients of the virus, so as more patients are cured, the number of newly infected individuals should drop. How far in the future the drop begins will be dictated by how quickly patients get on medication, so the faster the ramp-up in sales, the sooner sales will drop off.

Far enough in the future?
That's what every hepatitis C investor has to ask: Can you capture the value now and get out before things eventually blow up?

At this point, investors seem to be ignoring the future -- Pharmasset is up more than 500% over the last year -- but that seems a little risky for long-term investors. If you're going to invest in the space for any reasonable length of time, consider a company that has its hand in more than one market. Vertex, for instance, is developing drugs for cystic fibrosis, and it's on sale.

The San Francisco Chronicle on the Gilead/Pharmasset deal...

The San Francisco Chronicle speculates that Gilead's acquisition of Pharmasset...at a premium... may start a trend of other companies vested heavily in the antiviral arena buying similar, smaller companies with potentially commercially viable molecules in development. I don't know if we'll see this large a premium paid for a company again in the near future, but the article does name Inhibitex, Achillion and Idenix Pharmaceuticals as possible takeover targets by antiviral behemoths like J&J, BMS and Roche.

Gilead's Pharmasset buy may spur similar deals

Meg Tirrell,Tara Lachapelle, Bloomberg News

Tuesday, November 22, 2011

Gilead Sciences' acquisition of Pharmasset at the highest valuation on record for a drug takeover is turning makers of hepatitis C therapies from Inhibitex to Achillion Pharmaceuticals into the next targets.

Gilead agreed Monday to buy Pharmasset for $10.8 billion, valuing the developer of an experimental, oral treatment at 70 times its net assets, the most ever for a medical drug acquisition greater than $500 million, according to data compiled by Bloomberg. The price is 94 percent higher than Pharmasset's 20-day average, also the industry's richest on record. Applying that premium, Inhibitex would cost $1.1 billion, Achillion $791 million, and Idenix Pharmaceuticals $1.3 billion, the data show.

With the market for the next generation of hepatitis C therapies potentially worth $20 billion by 2020, Inhibitex, Achillion and Idenix may be bought within a year, William Blair & Co. said. While Gilead suffered its steepest stock drop in a year and a half Monday, and none of these unprofitable biotechnology companies have a hepatitis C drug for sale yet, the other targets would require no more than a fifth of the price for Pharmasset even with the same premium, the data show.

Waves of deals

"These deals tend to happen in waves," said Dan Veru, who oversees $3.4 billion including Pharmasset shares as chief investment officer of Palisade Capital Management LLC. "It's amazing to me that Gilead's willing to gamble $11 billion. It is a statement on the future opportunity to the market. Hepatitis C is an enormous business target."

Foster City's Gilead, the world's largest maker of HIV medicines, is paying $137 a share in cash for Pharmasset to gain an oral drug in development for a virus that is now largely treated with injections. The price tag is 70 times its book value, or the value of its assets minus liabilities, topping the industry's previous record of 60 times when Barr Laboratories Inc. bought Duramed Pharmaceuticals Inc. in 2001, according to data compiled by Bloomberg.

Pharmasset reported earlier this month that 40 patients who received its experimental hepatitis C treatment, PSI-7977, were responsive after 12 weeks. About half the patients had been followed up to 24 weeks and were all cured with no significant adverse events. The drug was tested in combination with ribavirin, a medication currently used in treating the disease, in patients with hepatitis C genotypes 2 and 3. Genotype 1 is most common and hardest to treat.

Hepatitis C is a viral infection that can lead to swelling of the liver. As many as 170 million people globally carry the virus, which is transmitted through exposure to infected blood, and more than 350,000 die from related illnesses each year, according to the World Health Organization.

"Hepatitis C is very prevalent in the population," said Andrew Berens, a senior health care analyst with Bloomberg Industries. "A lot of the market opportunity is going to expand if you have an all-oral regimen. We're going to see a land grab to try and get companies that are developing them."

Shares tripled

Even after Pharmasset's shares more than tripled this year before the deal was announced, the price is still 94 percent higher than its 20-day average of $70.65. That's a record for a takeover greater than $500 million in the drug industry, which has fetched an average premium of only 25 percent, according to data compiled by Bloomberg.

"Usually we associate these kinds of premiums with biotech bull markets, but it also can be a function of other possible bidders, scarcity and stage of assets," said Les Funtleyder, a health strategist and portfolio manager at Miller Tabak & Co., which owns Pharmasset shares. "If anybody was thinking about doing something in hepatitis C, they would be thinking a lot harder today than they would be yesterday."

Pharmaceutical companies that may look to expand in the market for hepatitis C treatments include Roche Holding AG, Merck & Co., Bristol-Myers Squibb Co. and Johnson & Johnson, according to Funtleyder and Brian Skorney, an analyst at Brean Murray Carret & Co.

These companies are "all heavily invested in the antiviral arena," Skorney said. "Worldwide this is a huge, huge market opportunity."

Market data provided by Bloomberg News


Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/11/22/BUBM1M2KS9.DTL#ixzz1eV5AwfCx

Gilead Sciences to Acquire Pharmasset, Inc. for $11 Billion

This is a game-changer in HCV drug development. Gilead, long a commercial juggernaut in the HBV and HIV commercial space, purchases Pharmasset whose HCV development portfolio includes it's AASLD show-stopper nucleotide analog PSI-7977. Gilead already has an impressive HCV drug development program in place and with it's expertise in antiviral co-formulation, one can foresee leveragin that expertise to Gilead's full advantage in developing all-oral HCV antiviral compounds. It will be interesting to see how the competition reacts. It could be game-over for many otherwise fledgling development programs whose molecules just won't be able to compete


Gilead Sciences to Acquire Pharmasset, Inc. for $11 Billion

- Accelerates Development of All-Oral Regimen for the Treatment of HCV -
- Leverages Gilead's Infrastructure and Expertise in Antiviral Drug Development, Manufacturing and Commercialization -

FOSTER CITY, Calif. & PRINCETON, N.J., Nov 21, 2011 (BUSINESS WIRE) --

Gilead Sciences, Inc. (Nasdaq:GILD) and Pharmasset, Inc. (Nasdaq:VRUS) announced today that the companies have signed a definitive agreement under which Gilead will acquire Pharmasset for $137 per share in cash. The transaction, which values Pharmasset at approximately $11 billion, was unanimously approved by Pharmasset's Board of Directors. Gilead plans to finance the transaction with cash on hand, bank debt and senior unsecured notes. The company expects the transaction, when completed, to be dilutive to Gilead's earnings through 2014 and accretive in 2015 and beyond. Further guidance will be provided when the transaction closes, which is expected to be in the first quarter of 2012.

Pharmasset currently has three clinical-stage product candidates for the treatment of chronic hepatitis C virus (HCV) advancing in trials in various populations. The company's lead product candidate, PSI-7977, an unpartnered uracil nucleotide analog, has recently been advanced into two Phase 3 studies in genotype 2 and 3 patients. Both studies will utilize 12 weeks of treatment with PSI-7977 in combination with ribavirin. One study will compare this all-oral regimen against 24 weeks of the standard-of-care pegylated interferon/ribavirin in treatment-naïve patients, and the second study will compare the all-oral regimen to placebo in interferon-intolerant/ineligible patients. A third Phase 3 study in genotype 1 patients will be initiated in the second half of 2012, the design of which is dependent on the outcome of Phase 2 studies which are evaluating PSI-7977 in various combinations in genotype 1-infected patients. If successful, this strategy could lead to an initial U.S. regulatory approval of PSI-7977 in 2014. PSI-938, an unpartnered guanosine nucleotide analog, is being tested in a Phase 2b interferon-free trial as monotherapy and in combination with PSI-7977 in subjects with HCV of all viral genotypes. Mericitabine (RG7128), a cytidine nucleoside analog, is partnered with Roche and is being evaluated in three Phase 2b trials. Roche is responsible for all aspects of the development of mericitabine.

"The acquisition of Pharmasset represents an important and exciting opportunity to accelerate Gilead's effort to change the treatment paradigm for HCV-infected patients by developing all-oral regimens for the treatment of the disease regardless of viral genotype," said John C. Martin, PhD, Chairman and Chief Executive Officer of Gilead. "Pharmasset presented compelling Phase 2 data earlier this month further characterizing the strong efficacy and safety profile of PSI-7977. The compound, together with Pharmasset's other pipeline candidates, represents a strong strategic fit with Gilead's vision, pipeline and capabilities. This transaction will serve to drive the long-term growth of our business, and we look forward to working closely with the Pharmasset team to advance a broad clinical program in HCV to address the unmet needs of patients and the medical community."

"We are excited to join together with Gilead, which shares our commitment to providing HCV patients with new, highly efficacious and safe oral therapies," said Schaefer Price, President and Chief Executive Officer, Pharmasset. "We are very encouraged by the data from our Phase 2 studies of PSI-7977 and believe strongly in the potential of this compound to be a component in the transformation of the treatment of chronic HCV. Gilead's established expertise and leadership in the field of antiviral drug development and commercialization, coupled with the company's existing portfolio of promising compounds for HCV, make this partnership an ideal step to fully realize the potential of our promising molecules as part of future all-oral combination therapies for millions of patients in need around the world."

Gilead's research and development portfolio includes seven unique molecules in various stages of clinical development for the treatment of HCV. Pegylated interferon in combination with ribavirin is currently part of the standard of care treatment for patients with chronic hepatitis C. Gilead is focused on advancing multiple compounds with different mechanisms of action and resistance profiles in combinations that will support delivery of an all-oral regimen that would eliminate the need for pegylated interferon. Three separate all-oral Phase 2 studies are currently ongoing, and Gilead expects clinical data from these studies to become available in 2012 and early 2013. Pharmasset's compounds are complementary to Gilead's existing HCV portfolio, and the transaction will help advance Gilead's effort to develop an all-oral regimen for the treatment of HCV.

Terms of the Transaction

Under the terms of the merger agreement, a wholly-owned subsidiary of Gilead will promptly commence a tender offer to acquire all of the outstanding shares of Pharmasset's common stock at a price of $137 per share in cash. Following successful completion of the tender offer, Gilead will acquire all remaining shares not tendered in the offer through a second step merger at the same price as in the tender offer.

The consummation of the tender offer is subject to various conditions, including a minimum tender of at least a majority of outstanding Pharmasset shares on a fully diluted basis, the expiration or termination of the waiting period under the Hart Scott Rodino Antitrust Improvements Act, and other customary conditions. The tender offer is not subject to a financing condition.

The $137 per share price in the transaction represents an 89% premium to Pharmasset's closing share price on Friday, November 18, 2011, the last trading day prior to announcement, and 59% to Pharmasset's all time high closing stock price.

Gilead has received commitments from Bank of America Merrill Lynch and Barclays Capital in connection with financing of the transaction.

Barclays Capital and Bank of America Merrill Lynch are acting as financial advisors to Gilead in the transaction. Morgan Stanley & Co. LLC is acting as the financial advisor to Pharmasset. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel to Gilead and Sullivan & Cromwell LLP is serving as legal counsel to Pharmasset.

Conference Call

Gilead will host a conference call today, Monday, November 21, 2011, at 8:00 a.m. Eastern Time, to discuss the proposed acquisition. To access the live call, please dial 1-800-599-9829 (U.S.) or 1-617-847-8703 (international). The conference passcode number is 61526607. Telephone replay is available approximately one hour after the call through 11:00 a.m. Eastern Time, November 24, 2011. To access, please call 1-888-286-8010 (U.S.) or 1-617-801-6888 (international). The conference passcode number for the replay is 39677531. The information provided on the teleconference is only accurate at the time of the conference call, and Gilead will take no responsibility for providing updated information.

About Pharmasset

Pharmasset is a clinical-stage pharmaceutical company committed to discovering, developing and commercializing novel drugs to treat viral infections. Pharmasset's primary focus is the development of oral therapeutics for the treatment of hepatitis C virus (HCV) infection. Pharmasset's research and development efforts are focused on nucleoside/tide analogs, a class of compounds which act as alternative substrates for the viral polymerase, thus inhibiting viral replication.

About Gilead Sciences

Gilead Sciences is a biopharmaceutical company that discovers, develops and commercializes innovative therapeutics in areas of unmet medical need. Gilead's mission is to advance the care of patients suffering from life-threatening diseases worldwide. Headquartered in Foster City, California, Gilead has operations in North America, Europe and Asia Pacific.

Forward-Looking Statement

This press release includes forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks, uncertainties and other factors. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including all statements regarding the intent, belief or current expectation of the companies' and members of their senior management team. Forward-looking statements include, without limitation, statements regarding business combination and similar transactions, prospective performance and opportunities and the outlook for the companies' businesses, including, without limitation, the ability of Gilead to advance Pharmasset's product pipeline or develop an all-oral antiviral regimen for HCV, performance and opportunities and regulatory approvals, the anticipated timing of data from clinical data; the possibility of unfavorable results of the companies' clinical trials; filings and approvals relating to the transaction; the expected timing of the completion of the transaction; the ability to complete the transaction considering the various closing conditions; and any assumptions underlying any of the foregoing. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties and are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those currently anticipated due to a number of risks and uncertainties. Risks and uncertainties that could cause the actual results to differ from expectations contemplated by forward-looking statements include: uncertainties as to the timing of the tender offer and merger; uncertainties as to how many of Pharmasset's stockholders will tender their stock in the offer; the possibility that competing offers will be made; the possibility that various closing conditions for the transaction may not be satisfied or waived, including that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the transaction; the effects of the transaction on relationships with employees, customers, other business partners or governmental entities; other business effects, including the effects of industry, economic or political conditions outside of the companies' control; transaction costs; actual or contingent liabilities; and other risks and uncertainties detailed from time to time in the companies' periodic reports filed with the Securities and Exchange Commission, including current reports on Form 8-K, quarterly reports on Form 10-Q and annual reports on Form 10-K. All forward-looking statements are based on information currently available to the companies, and the companies assume no obligation to update any such forward-looking statements.

Additional Information and Where to Find It

The tender offer described in this document has not yet commenced. This announcement is neither an offer to purchase nor a solicitation of an offer to sell shares of Pharmasset. At the time the offer is commenced, Gilead will file a Tender Offer Statement on Schedule TO with the U.S. Securities and Exchange Commission, and Pharmasset will file a Solicitation/Recommendation Statement on Schedule 14D-9 with respect to the offer. Pharmasset stockholders and other investors are urged to read the tender offer materials (including an Offer to Purchase, a related Letter of Transmittal and certain other offer documents) and the Solicitation/Recommendation Statement because they will contain important information which should be read carefully before any decision is made with respect to the tender offer. The Offer to Purchase, the related Letter of Transmittal and certain other offer documents, as well as the Solicitation/Recommendation Statement, will be made available to all stockholders of Pharmasset at no expense to them. The Tender Offer Statement and the Solicitation/Recommendation Statement will be made available for free at the Commission's web site at www.sec.gov. Free copies of these materials and certain other offering documents will be made available by Gilead by mail to Gilead Sciences, Inc., 333 Lakeside Drive, Foster City, CA 94404, attention: Investor Relations.

In addition to the Offer to Purchase, the related Letter of Transmittal and certain other offer documents, as well as the Solicitation/Recommendation Statement, Gilead and Pharmasset file annual, quarterly and special reports, proxy statements and other information with the Securities and Exchange Commission. You may read and copy any reports, statements or other information filed by Gilead or Pharmasset at the SEC public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the public reference room. Gilead's and Pharmasset's filings with the Commission are also available to the public from commercial document-retrieval services and at the website maintained by the Commission at www.sec.gov.

For more information on Gilead Sciences, please visit the company's website at www.gilead.com or call Gilead Public Affairs at 1-800-GILEAD-5 or 1-650-574-3000.



SOURCE: Gilead Sciences, Inc.

Gilead
Susan Hubbard, 650-522-5715 (Investors)
Amy Flood, 650-522-5643 (Media)
or
Pharmasset
Richard E.T. Smith, 609-865-0693 (Investors)
or
Sard Verbinnen & Co
Andrew Cole/Chris Kittredge, 212-687-8080 (Media)

New MEDSCAPE article sheds more light on PSI-7977 and the ELECTRON trial...

Pharmasset launched a broadside in the HCV drug development wars during AASLD, revealing that some patients may be able to achieve and SVR without the use of interferon. This was according to nterim results from the phase II ELECTRON trial, looking at Pharmasset's nucleotide inhibitor PSI-7977 in various combinations with ribavirin and interferon/no interferon in different Hepatitis C genotypes. In one arm, PSI-7977 plus ribavirin was administered for 12 weeks in 10 genotype 2 and 3 patients. This article sheds further light on those patients - in short, they were genotype 2/3, tx-naïve without cirrhosis. They had a mean age of 47 years, mean baseline HCV RNA was 6.49 log10 IU/mL, and roughly 43% had the favorable 'CC genotype' associated with favorable response to standard interferon-based therapy. The author also interviews lead PI Edward Gane, MD and gets 'too good to be true?' thoughts from Michael Bernstein, MD who was involved in the NM-286 clinical trials.

From Medscape Medical News
New HCV Drug Achieves 100% Cure Rate Without Interferon

Neil Canavan

November 9, 2011 (San Francisco, California) — An interferon-free regimen for the treatment of infection with hepatitis C virus (HCV) might soon be available, according to data from the ELECTRON trial, presented here at The Liver Meeting 2011: American Association for the Study of Liver Diseases 62nd Annual Meeting.

In ELECTRON — 1 of 2 phase 2 studies of the investigational compound PSI-7977 (Pharmasset) reported here — an interferon-free regimen of PSI-7977 plus ribavirin achieved a 100% sustained viral response (SVR) at 12 weeks in all study subjects.

"PSI-7977 has the potential to dramatically change the treatment paradigm for HCV," said lead study investigator Edward Gane, MD, from Auckland City Hospital in New Zealand.

PSI-7977 is a uridine nucleotide analog polymerase inhibitor that is administered once daily with or without food. It has demonstrated robust activity in patients infected with HCV genotype 1 when used in combination with pegylated-interferon and ribavirin after a 12-week course.

Activity with this agent used as a monotherapy has also been reported.

"The aim of the ELECTRON trial was to determine the shortest duration of interferon, if any, required to achieve SVR when PSI-7977 plus ribavirin are administered for 12 weeks," Dr. Gane explained.

ELECTRON investigators recruited 40 patients who were randomized to 1 of 4 treatment groups: PSI-7977 400 mg plus ribavirin for 12 weeks plus interferon for 0, 4, 8, or 12 weeks.

Patients were treatment-naïve, noncirrhotic, infected with HCV genotype 2 or 3, and stratified by interleukin (IL)28B single-nucleotide polymorphisms (SNP) and HCV RNA levels. Mean age was 47 years and mean baseline HCV RNA was 6.49 log10 IU/mL, with 42.5% exhibiting the CC genotype at the IL28B SNP.

"We selected a genotype 2/3 population because this represents a population that would be more easily rescued with interferon in the event of virologic breakthrough," Dr. Gane explained.

Results after treatment initiation were dramatic. "All patients achieved a rapid virologic response, with over 80% being nondetectable at 2 weeks," reported Dr. Gane.

All patients had undetectable HCV at 3 weeks; furthermore, all patients achieved end-of-treatment response. No cases of treatment resistance were observed.

"Even following cessation of interferon, or with no interferon, there were no virologic breakthroughs on treatment." Also encouraging was the fact that all patients in the study experienced a rapid normalization of alanine aminotransferase.

There were no serious adverse events, and the mild to moderate events observed were attributed to either interferon or ribavirin. Significant improvements in safety and tolerability were seen in the interferon-free treatment group. No safety signals for PSI-7977 were observed, and there were no treatment-related discontinuations.

Results of the 12-week analysis prompted study investigators to add an exploratory treatment group of open-label PSI-7977 monotherapy for 12 weeks (n = 10). "The response was the same as with combination treatment with ribavirin," said Dr. Gane. Although this study is ongoing, 6 of 10 patients have achieved SVR at 4 weeks.

"These data clearly demonstrate that PSI-7977 exhibits high potency and has a high barrier to resistance," Dr. Gane said, noting that the drug is being advanced in phase 3 investigations in all HCV genotypes.

Too Good to be True?

Michael Bernstein, MD, director of the hepatitis clinic at the Coney Island Hospital, Brooklyn, New York, has doubts about PSI-7977. "If you use it with ribavirin and no interferon, you get a 100% SVR; if you use it alone, you get a 100% SVR."

Dr. Bernstein accepts the efficacy of PSI-7977 for the moment, but is concerned that ELECTRON isn't powered to say much about the tolerability or resistance profiles of the drug.

"What we've found with most of these [polymerase inhibitors] is that if you use them by themselves, you get resistance; if you don't, they can be very difficult to tolerate," said Dr. Bernstein. "There was a drug being investigated at Mount Sinai — a polymerase inhibitor, NM286 — and those patients got severe diarrhea and could not tolerate it. According to the ELECTRON study, everything was perfect — no gastrointestinal issues, no apparent adverse events of any kind, and it worked 100% of the time without interferon, or ribavirin.... If it's true, it will be great. The holy grail is to try to rid HCV treatment regimens of interferon."

Although sincerely impressed, Dr. Bernstein, who has seen many drugs come and go, suspects that as larger phase 3 trials of PSI-7977 are conducted, polymerase-associated adverse events, tolerability issues, and treatment resistance patterns will emerge.

Dr. Gane reports advisory board relationships with Pharmasset, Gilead, Roche, Janssen-Cilag, and Boehringer-Ingelheim. Dr. Bernstein has disclosed no relevant financial relationships.

The Liver Meeting 2011: American Association for the Study of Liver Diseases (AASLD) 62nd Annual Meeting: Abstract 34. Presented November 6, 2011.

Pharmasset's HCV nucleotide analog PSI-7977 poised to raise the bar for HCV DAAs....

By far the biggest buzz at AASLD thus far has been the performance of Pharmasset's PSI-7977, a nucleotide analog being studied in various combinations for the treatment of chronic hepatitis C. Pharmasset released Phase II data at AASLD showing 100% SVR in a small group of genotype 2/3 patients in combination with ribavirin but without the need for interferon. The success despite the lack of interferon raised hopes for a truly interferon-free pan-genotypic treatment for HCV with once daily dosing and a minimum amount of side effects. The drug has a long way to go in development, but this data certainly buoyed hopes of patients, HCV providers and investors alike. One hopes that the data for prior non-responders (especially null-responders) and genotype 1 patients fair as well.

Twelve Weeks Interferon-Free PSI-7977 Regimen Cures 100 Percent Hep C Genotype 2/3

A twelve-week course of Pharmasset’s once-daily experimental nucleotide analog PSI-7977, combined with ribavirin, cured 10 of 10 people living with genotype 2/3 hepatitis C virus (HCV) who used the regimen—without pegylated interferon—in a Phase II clinical trial. The highly encouraging results were reported Sunday, November 6, at the 62nd Annual Meeting of the American Association for the Study of Liver Diseases (AASLD) in San Francisco.

Compared with the three other groups included in the study, which involved taking PSI-7977 plus ribavirin with either four, eight or 12 weeks of pegylated interferon, significant improvements in safety and tolerability were also documented among those using PSI-7977 plus ribavirin alone, according to Edward Gane, MD, of the Auckland City Hospital in Auckland, New Zealand, and his ELECTRON study colleagues.

Results from early studies of PSI-7977 have been promising. In the PROTON study, PSI-7977 combined with pegylated interferon plus ribavirin resulted in sustained virologic responses (SVRs)—viral cures—in 96 percent of study volunteers with HCV genotype 2/3 and 91 percent of those with HCV genotype 1 (the most common yet hardest-to-treat form of the virus in the United States).

ELECTRON, initiated in December 2010, was conducted to determine the shortest duration of pegylated interferon—if any—required to achieve SVRs when PSI-7977 plus ribavirin are given for 12 weeks. HCV genotype 2/3 patients were initially selected for this unorthodox study—pegylated interferon has long been a mainstay agent in hepatitis C drug regimens—given pegylated interferon and ribavirin tend to be much more effective for individuals with genotype 2/3 virus and could be called upon in the event of poor responses to PSI-7977/ribavirin in the study.

No “rescue” therapy proved necessary. At virtually all study time points—weeks 4, 8 and 12 during therapy and weeks 4, 8, 12 and 24 following the completion of treatment—100 percent of the patients in each group maintained undetectable HCV viral loads. Eleven patients received PSI-7977/ribavirin plus 12 weeks of pegylated interferon, 10 received PSI-7977/ribavirin plus eight weeks of pegylated interferon, nine received PSI-7977/ribavirin plus pegylated interferon and ten received PSI-7977/ribavirin without pegylated interferon.

Gane noted that HCV viral load suppression was rapid in all four treatment groups—virtually everyone had HCV below the level of detection within three weeks of beginning treatment.

At least one side effect—including headache, fatigue, depression, insomnia, anxiety, irritability, muscle soreness and upper respiratory tract infections—was more likely to be documented in those in the 12-week pegylated interferon group (72 percent), compared with those who didn’t receive any pegylated interferon (40 percent).

Similarly, whereas moderate-to-severe drops in neutrophils—a type of white blood cell—was documented in roughly 70 percent of those in the 12-week pegylated interferon group, no volunteers in the interferon-free PSI-7977/ribavirin group experienced this toxicity. Interferon-free PSI-7977 plus ribavirin also had much less of an impact on hemoglobin levels, a marker of anemia.

Also encouraging, all patients in the study experienced a rapid normalization of ALT, a key liver enzyme. Among those in the interferon-free treatment group, normal ALT levels were documented in all patients by the end of the third week of treatment.

In summary, Gane noted, “PSI-7977 [400 milligrams once daily] remains very well tolerated with no attributable safety signal, no treatment discontinuations and no treatment emergency laboratory abnormalities.” As for potency, he concluded that PSI-7977/ribavirin “elicited rapid suppression” of HCV viral load in study volunteers with HCV genotype 2 or 3 and that all 40 patients in the study achieved an SVR, regardless of whether or not interferon was used. Additionally, not a single case of drug-resistant virus emerged during the study.

Further results from ELECTRON are expected. The study has been amended, adding several new treatment groups. One group is exploring PSI-7977 used as monotherapy—without pegylated interferon or ribavirin—to treat genotype 2/3 infection. Preliminary data reported by Gane's team suggest that four patients in this group have maintained undetectable HCV levels four weeks after discontinuing treatment.

Another group is studying PSI-7977 in combination with pegylated interferon plus ribavirin, again in genotype 2/3 patients, but for only eight weeks.

Three additional groups are now enrolling patients. One is studying 12 weeks of PSI-7977 plus ribavirin, without interferon, in HCV genotype 2/3 patients who weren't able to clear the virus with 24 weeks of previous pegylated interferon/ribavirin therapy. A second is evaluating PSI-7977 plus ribavirin in HCV genotype 1 patients beginning therapy for the first time. The third group consists of individuals with HCV genotype 1 null responders (patients who responded very poorly to prior pegylated interferon/ribavirin treatment); they will receive PSI-7977/ribavirin for a total of 12 weeks.

Pharmasset recently announced its Phase III clinical trial program. Two studies—FISSION and POSITRON—will further explore the safety and efficacy of PSI-7977 plus ribavirin, but without pegylated interferon, in approximately 725 people with genotype 2/3 HCV infection. A third study will explore PSI-7977 in HCV genotype 1 patients, with the design of the study determined by the ongoing ELECTRON clinical trial and another study still under way.

Read the full article here: http://www.aidsmeds.com/articles/psi7977_svr_hcv_1667_21405.shtml

The Motley Fool comments on the next generation of Hepatitis C drug therapy...

The Motley Fool's take on the future of HCV drug development, buyouts and partnerships. Once the fodder for small biotechs, Big Pharma has their eye on the marketplace. That means plenty of action in the coming months in the quest to usurp Telaprevir's crown.

Gunning for the Leaders

By Brian Orelli
October 31, 2011

Merck's (NYSE: MRK ) Victrelis and Vertex Pharmaceuticals' (Nasdaq: VRTX ) Incivek have been on the market for only five months, and the threats to unseat them keep coming.

Data on some of the next-generation hepatitis C drugs will be presented at the end of this week, when the annual meeting of the American Association for the Study of Liver Diseases kicks off. Add in top-line data that's been released recently and expected results in the next few months, and the hepatitis C space is looks like it'll get really crowded, really quickly.

The biotech front-runner
Pharmasset (Nasdaq: VRUS ) has grabbed most of the spotlight. The company has a drug, RG7128, partnered with Roche, but most of the focus has been on PSI-7977 that it owns in its entirety. The company will present data at the meeting including results using PSI-7977 as a monotherapy. Reducing or eliminating peginterferon, which must be used with Incivek and Victrelis, is a goal of every next-generation hepatitis C regimen because of nasty side effects with peginterferon.

Achillion Pharmaceuticals (Nasdaq: ACHN ) will make multiple presentations at the meeting, with its phase 2 compound, ACH-1625, being the most interesting. Idenix Pharmaceuticals has a pair of presentations at the meeting.

No shortage of pharma competition
Unfortunately for the smaller biotechs, Big Brother is interested in the space as well.

Earlier this month, Abbott Labs (NYSE: ABT ) said it has a drug combination that might be able to deliver cure rates as high as 90% without peginterferon. Don't write off the others just yet, though. It was a fairly small trial, and the data from more patients might not be as impressive.

Bristol-Myers Squibb (NYSE: BMY ) recently presented data for one of its compounds, BMS-790052. In a phase 2 trial, 83% of patients taking the two highest doses of BMS-790052 had undetectable viral levels 24 weeks after treatment, compared with just 25% who took just peginterferon alfa and ribavirin. But the results with BMS-790052 required adding it to peginterferon and ribavirin.

The upside to pharma's interest
Fortunately for biotechs, combination treatments are likely to be key to ridding patients of the virus. Resistance issues are common, but they can be avoided by combining medications that attack the virus in different ways.

No doubt Roche's acquisition of Anadys earlier this month was driven by its desire to get a hold of Anadys' hepatitis C treatment, setrobuvir. While we might see more acquisitions in the works, partnerships -- especially non-exclusive ones -- could be the best solution for both sides. Pharmasset has used the double-dipping strategy making pacts with both Johnson & Johnson (NYSE: JNJ ) and Bristol-Myers to combine their hepatitis C treatments with PSI-7977.

The problem with non-exclusive pacts is that they may not provide biotechs with much cash to fund their own development. On the other hand, if a biotech doesn't make too many of them, it could lead to a takeout offer.

Which combo is the combo?
It's hard to know which combination will eventually win out. When you start adding multiple drugs to each other, there's bound to be side-effect issues that aren't a problem when they're used individually. Hepatitis C is a little less life-threatening than HIV, so the FDA will demand a cleaner side-effect profile than they have for cocktails that treat HIV.

And while finding the most potent combination is important, it's useful only if they complement each other's resistance issues; knocking the virus down to undetectable levels in 100% of the patients isn't particularly useful if the virus just rebounds once it mutates in a way to avoid the drugs' inhibitory properties.

Rather than trying to guess which company will eventually profit, buying a basket of hepatitis C drugmakers might be the best move. If a combo treatment is going to eventually work, why not a combination of investments?

Pharmasset expands PSI-7977 ELECTRON trial for treatment of HCV...

Pharmasset expands it's ELECTRON trial by adding two interferon-free arms and modifying another one. The changes include a PSI-7977 monotherapy arm (!!!) for Tx-naive genotype 1 patients; a PSI-7977 + RBV arm in Tx-experienced GT 2/3 patients and modifying a treatment arm for null responders by adding an interferon-free PSI-7977 + RBV arm. This announcement caused investors to flee Vertex Pharmaceuticals, which saw a 7% slide today.

press release

Oct. 10, 2011, 6:45 a.m. EDT

Pharmasset Announces Further Expansion of ELECTRON Trial in Hepatitis C

--**Added PSI-7977 monotherapy arm in treatment-naive patients with HCV GT1
--**Added PSI-7977/RBV arm in treatment experienced patients with HCV GT2/3
--**Modified previously-announced treatment regimen in HCV GT1 prior null responders to explore IFN-free regimen of PSI-7977/RBV


PRINCETON, N.J., Oct. 10, 2011 /PRNewswire via COMTEX/ -- Pharmasset, Inc. announced today the addition of two treatment arms to the ELECTRON trial of PSI-7977, a nucleotide analog polymerase inhibitor, for the treatment of chronic hepatitis C (HCV). The rapid and consistent antiviral effects and high barrier to resistance demonstrated with PSI-7977 to date provided the rationale for additional exploratory regimens in this setting. The protocol amendment adds one arm exploring 12 weeks of PSI-7977 monotherapy in treatment naive patients with HCV genotype 1 (GT1), and one arm of PSI-7977 and ribavirin (RBV) in treatment-experienced patients with HCV genotype 2 (GT2) or genotype 3 (GT3). In addition, the previously announced arm in HCV GT1 patients with a prior "null" response to an interferon (IFN) containing regimen, which was planned to assess PSI-7977/IFN/RBV, has been modified to an IFN-free 12-week regimen of PSI-7977/RBV.

"We look forward to reporting SVR12 results from Part 1 and interim data from the PSI-7977 monotherapy arm of ELECTRON on Sunday, November 6th, 2011 at the upcoming 2011 American Association for the Study of Liver Diseases (AASLD) annual meeting. The preliminary results to be discussed at AASLD led us to expand the study to add an arm of PSI-7977 monotherapy for HCV GT1," said Michelle Berrey, MD, MPH, Pharmasset's Chief Medical Officer. "We and others continue to explore the potential of PSI-7977 for IFN-free and monotherapy treatment regimens in a broader group of individuals living with HCV of all genotypes and regardless of their response to prior treatment."

In addition to previously announced interferon-free studies of PSI-7977 by Bristol Myers Squibb and Tibotec, The National Institute of Health (NIH) recently initiated an interferon-free 24 week study of PSI-7977 400mg QD with and without ribavirin, in 60 treatment naive patients with HCV genotype 1 (GT1) in the US.

About ELECTRON

ELECTRON is an exploratory study of PSI-7977 for the treatment of chronic HCV infection. Part 1 of the trial is evaluating 12-week regimens of interferon-free PSI-7977 400mg QD with ribavirin (RBV), and three abbreviated duration peginterferon (Peg-IFN) regimens of 4, 8, or 12 weeks in treatment-naive patients with HCV GT2 or GT3. The primary endpoint of the trial is the safety and tolerability of PSI-7977 400mg QD and RBV for 12 weeks, administered with or without Peg-IFN. On May 11, 2011, Pharmasset announced the completed enrollment of Part 1 of ELECTRON:

PSI-7977 400 mg with Peg-IFN and RBV for 12 weeks (GT2/3)

PSI-7977 400 mg with RBV for 12 weeks, Peg-IFN weeks 1-8 only (GT2/3)

PSI-7977 400 mg with RBV for 12 weeks; Peg-IFN weeks 1-4 only (GT2/3)

PSI-7977 400 mg with RBV for 12 weeks (GT2/3)

In Part 2 of ELECTRON, a 5th cohort was added to explore PSI-7977 monotherapy in treatment naive patients with HCV GT2 or GT3:

PSI-7977 400 mg monotherapy for 12 weeks (n=10 GT2/3)

Following on the previously reported 100% SVR12 in treatment-naive subjects with HCV GT2/3 (PROTON), a 6th cohort was added to ELECTRON to explore an 8-week duration of PSI-7977Peg-IFN/RBV. The previously announced 7th cohort in HCV GT1 patients with a prior "null" response to Peg-IFN, has been modified to an interferon-free 12-week regimen of PSI-7977/RBV.

PSI-7977 400 mg with Peg-IFN/RBV for 8 weeks (n=10 GT2/3 treatment-naive)

PSI-7977 400 mg with RBV for 12 weeks (n=10 GT1 null)

In Part 3 of ELECTRON, two additional IFN-free regimens will be explored in treatment-naive patients with HCV GT1 and in treatment-experienced patients with HCV GT2 or GT3.

PSI-7977 400 mg monotherapy for 12 weeks (n=25 GT1 treatment-naive)

PSI-7977 400 mg with RBV for 12 weeks (n=25 GT2/3 treatment-experienced)

About Pharmasset

Pharmasset is a clinical-stage pharmaceutical company committed to discovering, developing, and commercializing novel drugs to treat viral infections. Pharmasset's primary focus is the development of oral therapeutics for the treatment of hepatitis C virus (HCV) infection. Our research and development efforts are focused on nucleoside/tide analogs, a class of compounds which act as alternative substrates for the viral polymerase, thus inhibiting viral replication. We currently have three clinical-stage product candidates advancing in trials in various populations. Our pyrimidine, PSI-7977, an unpartnered uracil nucleotide analog, is currently under study in five Phase 2b trials, including abbreviated duration interferon and interferon-free regimens, in subjects with all HCV genotypes. Our purine, PSI-938, an unpartnered guanosine nucleotide analog, is in QUANTUM, a Phase 2b interferon-free trial of PSI-7977 and PSI-938 in subjects with all HCV genotypes. Mericitabine (RG7128) continues in three Phase 2b trials and one interferon-free trial being conducted through a strategic collaboration with Roche.

ContactRichard E. T. Smith, Ph.D.VP, Investor Relations and Corporate CommunicationsOffice: +1 (609) 865-0693

Forward-Looking Statements

Pharmasset "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release that are not historical facts are "forward-looking statements," that involve risks, uncertainties, and other important factors, including, without limitation, the risk of cessation or delay of any of the ongoing or planned clinical trials and/or our development of our product candidates, the risk that the results of previously conducted studies involving our product candidates will not be repeated or observed in ongoing or future studies involving our product candidates, the risk that our collaboration with Roche will not continue or will not be successful, and the risk that any one or more of our product candidates will not be successfully developed and commercialized. For a discussion of risks, uncertainties, and other important factors, any of which could cause our actual results to differ from those contained in the forward-looking statements, see the section entitled "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended September 30, 2010 and our Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission and discussions of potential risks, uncertainties, and other important factors in our subsequent filings with the Securities and Exchange Commission.

SOURCE Pharmasset, Inc.

Copyright (C) 2011 PR Newswire. All rights reserved

Anadys Pharmaceuticals' Steve Worland on the future of HCV drug development....

An excellent read here. Anadys Pharmaceuticals President and CEO Steve Worland gives us his take on the evolving HCV antiviral drug developmental landscape in this recent article published online in Xconomy. It's amazing how analogousness this development space is becoming to the early days of HIV. There are many notables in this article, including the mention of mathematical modeling that suggests that interferon-free regimens might be possible, but will need to contain three or four distinct antiviral mechanisms to result in a SVR without the emergence of resistance. I found his comparison of Anadys's HCV non-nuc setrobuvir to to the HIV non-nuc efavirenz to be interesting - his feeling is that, like efavirenz, setrobuvir's superior pharmacokinetics may be the answer to the inherent low barrier of resistance issues with the non-nuc class that have plagued other compounds such as Vertex's VX-222.

Dramatic Changes in Hepatitis C Treatment Expected to Continue
Steve Worland 9/6/11

Earlier this year the FDA approved telaprevir (Incivek) from Vertex Pharmaceuticals and boceprevir (Victrelis) from Merck for the treatment of hepatitis C. Both agents are protease inhibitors and represent the first approvals of direct acting antivirals for hepatitis C. Direct acting antivirals are a broad class of agents that act to block the growth of viruses by directly disrupting essential viral functions. The benefit of these drugs for hepatitis C follows the dramatic success of this class over the last 15 years in HIV. Now the future advances of direct acting antiviral therapy for hepatitis C is expected to follow a central theme of their use in HIV: that combination of multiple antivirals in a single treatment regimen will provide greater benefit than use of any one antiviral drug alone.

The new protease inhibitors were approved for use only in combination with two previously approved agents, pegylated interferon and ribavirin. The addition of either protease inhibitor increased clinical cure rates, known formally as sustained viral response (SVR) rates, by 30 to 40 percentage points over control groups receiving the standard pegylated interferon and ribavirin alone. As dramatic as these improvements are, there is a good chance for even more dramatic improvements if all-oral regimens, assembled by combining multiple direct acting antivirals, are able to maintain high cure rates while eliminating injectable interferon and its associated flu-like side effects that patients have long sought to avoid.

Next in the development queue are three agents that entered Phase III development this year, including two additional protease inhibitors (TMC435 from Johnson & Johnson’s Tibotec unit and BI201335 from Boehringer Ingelheim) and a cyclophilin inhibitor that disrupts a host function required for viral replication (alisporivir from Novartis). All three Phase III programs are exploring a modality similar to the approved agents, i.e. addition of a single new agent to the standard pegylated interferon/ribavirin. The ongoing Phase III programs will hope to demonstrate one or more advantage over the recently approved agents, potentially including better tolerability, further increases in cure rates, shorter duration of therapy and/or an increased proportion of patients successfully treated with shortened therapy. While such improvements may well be achieved, they may become less important or even irrelevant if the rapidly expanding number of direct acting antiviral combination trials leads to identification of new regimens that surpass all regimens that are based on a single antiviral drug added to the old standard regimen.

Investigation of direct acting antiviral combination regimens has exploded in the last 12 months. This advance has become possible because of the diversity of antiviral mechanisms distinct from protease inhibitors that are now represented in the pipeline of hepatitis C drugs in Phase II development across the industry. Diverse mechanisms are important because they typically provide distinct resistance profiles, and antiviral combinations are being assembled using new compounds with non-overlapping resistance profiles to provide a greater barrier to the development of antiviral resistance. Additional factors that are considered important in assembling optimal combinations include the safety and tolerability profile of each agent, compatible pharmacokinetic profiles and a low potential for unfavorable drug-drug interactions. The more extensively characterized each individual antiviral drug is, the lower the risk of an unanticipated negative interaction between the drugs once combined.

New mechanisms other than protease inhibitors that have entered large Phase IIb studies include non-nucleoside polymerase inhibitors (setrobuvir from my company, Anadys Pharmaceuticals, as well as tegobuvir from Gilead Sciences and filibuvir from Pfizer). Another class is composed of nucleoside/tide polymerase inhibitors (mericitabine from Roche and PSI-7997 from Pharmasset). There’s also an NS5a inhibitor in Phase IIb development (BMS-790052 from Bristol-Myers Squibb).

At Anadys, we chose to focus on the non-nucleoside class of polymerase inhibitors for several reasons. We recognized an inherent potential for an excellent safety profile, given the absence of structurally related host targets and the ability to generate inhibitors without relying on close analogs of host metabolites. The excellent safety record to date for setrobuvir is consistent with our initial expectations regarding safety. The diversity of applicable chemotypes also led us to expect a clear path to patent-protected intellectual property, exemplified by our recently issued U.S. patent covering setrobuvir. In other antiviral drug classes, especially nucleosides/tides and NS5a inhibitors, the range of useful chemical space discovered to date is considerably more narrow, leading to the potential for more interference on the IP side. Lastly, we recognized that a potential liability of the non-nucleoside class, a lower genetic barrier to resistance, could likely be addressed if we were able to engineer a high pharmacological barrier to resistance into candidate molecules. This recognition was based on the lessons learned about non-nucleosides in the 1990s in HIV. Specifically, there were two disappointing product introductions of non-nucleoside products for HIV that were plagued with rapid emergence of resistance—nevirapine (Viramune) from Boehinger Ingelheim and delavirdine (Rescriptor), now marketed by Pfizer. After that came efavirenz (Sustiva) from Bristol-Myers Squibb, so named for its ability to last longer in the bloodstream, which demonstrated that a non-nucleoside with good potency and a prolonged plasma half-life could demonstrate a dramatically improved resistance profile. While we reasoned that a similar solution would be applicable in hepatitis C, we also understood the significant medicinal chemistry challenge to accomplish this objective and furthermore understood that the technology platform at Anadys was exquisitely well matched to the molecular engineering challenge of simultaneously optimizing potency and pharmacokinetics. The excellent resistance profile of setrobuvir observed to date demonstrates the high pharmacological resistance barrier achieved with setrobuvir, and data to date is consistent with our idea that a high pharmacological barrier to resistance could serve in place of a high genetic barrier to resistance.

As the hepatitis C development landscape continues to advance, we expect to see an increasing number of direct acting antiviral combination trials and subsequent approval of new agents based on data derived from such trials. The FDA as well as patient advocacy groups have been strong proponents of investigating antiviral drug combinations prior to approval of individual components, and I expect an ongoing favorable regulatory environment towards combination trials provided that each individual agent is sufficiently well-characterized.

Companies that believe in the importance of antiviral combinations for future commercial relevance in hepatitis C are likely to have opinions as to how many drugs they believe will be needed in antiviral combination regimens, and are likely to pursue strategies directed at accessing at least that number of compounds if not a greater number as insurance against attrition. Mathematical modeling from Perelson and colleagues suggests that interferon-free regimens will need to contain three or four distinct antiviral mechanisms to result in viral eradication (SVR) prior to emergence of resistance. To access the required number of drugs, companies have several business alternatives available. They can rely on maturation of their internal pipelines, although few if any companies appear today to have sufficiently robust internal pipelines to rely exclusively on this approach. Companies can rely on cross-company clinical collaboration agreements to gain initial data on particular antiviral combinations, although this approach doesn’t directly answer the question of how to seek approval and launch effective marketing efforts for the individual components studied in a cross-company antiviral drug combination trial. Companies with antiviral drugs other than protease inhibitors can look to utilize one of the approved protease inhibitors as one other mechanism, analogous to the use of interferon and ribavirin in the development of the protease inhibitors to date, but this will only be a partial solution if three or more DAAs are required. Lastly, companies can gain exclusive access to antiviral drugs outside their current pipelines through a variety of business deals, allowing them to quickly assemble a pipeline with sufficient depth to increase the chances of being early to market with a successful combination regimen. To date, examples of all these strategies except combination with one of the approved protease inhibitors have been pursued by one or more companies. Going forward, these efforts across the industry are likely to culminate in approval of direct acting antiviral combination regimens, with the ultimate goal of assembling combinations powerful enough to eliminate interferon and perhaps ribavirin from hepatitis C therapy. These advancements may occur within the next few years, and if realized, would represent yet another dramatic improvement in hepatitis C therapy, at least as dramatic as the advances recently realized with the approval of the first protease inhibitors.

Steve Worland is the president and CEO of San Diego-based Anadys Pharmaceuticals.

Pharmasset & Tibotec team up HCV drugs in clinical collaborative agreement...

Pharmasset all over the news this week, they definitely seem to be teaming up with the right folks in their development of their nucleotide analog PSI-7977... with their own nuc PSI-938, with BMS's NS5a inhibitor and now with Medivir/Tibotec's TMC435. The HCV DAA development space is definitely heating up!

Pharmasset Enters into a Clinical Collaboration Agreement with Tibotec Pharmaceuticals for a Combination Study in Patients Chronically Infected with Hepatitis C


- Study to evaluate the combination of PSI-7977 and TMC435 with and without ribavirin in prior null responder, genotype 1 HCV patients

PRINCETON, N.J., July 6, 2011 /PRNewswire/ -- Pharmasset, Inc. (NASDAQ: VRUS), announced today that it has entered into a clinical collaboration agreement with Tibotec Pharmaceuticals to evaluate in a Phase 2 study the safety and efficacy of PSI-7977, Pharmasset's investigational nucleotide polymerase inhibitor, in combination with TMC435, Tibotec Pharmaceuticals' investigational protease inhibitor, for the treatment of chronic hepatitis C virus (HCV).

This phase 2 proof of concept study will evaluate the potential to achieve sustained virologic response 12 weeks post treatment with an all oral, once-daily, interferon-free treatment regimen in patients infected with genotype 1 HCV. Specifically, the study will assess the safety, pharmacokinetics and pharmacodynamics of 12 and 24 weeks of PSI-7977 in combination with TMC435, with and without ribavirin, in patients chronically infected with HCV genotype 1 who had a prior null response to peginterferon alfa and ribavirin treatment. The study is planned to start in the second half of 2011.

"We are excited to be working with Tibotec to simplify and improve HCV treatment," stated Bill Symonds, PharmD, Pharmasset's Senior Vice President of Clinical Pharmacology and Translational Medicine. "PSI-7977 is now being studied in interferon-free combinations with each of the three leading classes of direct-acting antivirals: Tibotec's protease inhibitor, Bristol-Myers Squibb's NS5a inhibitor, and our own nucleotide, PSI-938. This advances one of our key goals at Pharmasset: to develop our nucleotide analogs as the backbone of interferon-free HCV therapy."

About PSI-7977

PSI-7977 is a prodrug of a uracil nucleotide analog polymerase inhibitor we are developing for the treatment of chronic HCV infection. PSI-7977 has completed a 28 day phase 2a trial in combination with peg-interferon and ribavirin (Peg-IFN/RBV) and is currently being tested in four phase 2b studies: the PROTON trial in combination with peg-IFN/RBV in HCV genotype 1, 2 or 3 patients; the ATOMIC trial with peg-IFN/RBV in HCV genotypes 1,4,5,6; the ELECTRON trial, an interferon sparing /interferon free study in HCV genotypes 1,2 and 3 and a study with Bristol-Myers Squibb's NS5a inhibitor, BMS-790052, as part of an interferon free regimen. Pharmasset also anticipates initiating its own interferon free trial with PSI-7977 and PSI-938, a guanine nucleotide polymerase inhibitor in the third calendar quarter 2011.

About Pharmasset

Pharmasset is a clinical-stage pharmaceutical company committed to discovering, developing, and commercializing novel drugs to treat viral infections. Pharmasset's primary focus is the development of oral therapeutics for the treatment of hepatitis C virus (HCV) infection. Our research and development efforts are focused on nucleoside/tide analogs, a class of compounds which act as alternative substrates for the viral polymerase, thus inhibiting viral replication. We currently have three clinical-stage product candidates advancing in trials in various populations. Our pyrimidine, PSI-7977, an unpartnered uracil nucleotide analog, is currently under study in three Phase 2b trials in patients with HCV genotypes 1 through 6, including abbreviated duration interferon and interferon-free regimens. Our purine, PSI-938, an unpartnered guanosine nucleotide analog, recently reported safety and efficacy data from 14 days of monotherapy as well as 14 days in combination with the pyrimidine, PSI-7977. An SVR-endpoint study of the purine-pyrimidine combination is anticipated to begin in the third quarter of 2011. Mericitabine (RG7128) continues in two Phase 2b trials and one interferon-free trial being conducted through a strategic collaboration with Roche.

Pharmasset
Richard E. T. Smith, Ph.D.
VP, Investor Relations and Corporate Communications
Office: +1 (609) 865-0693

Pharmasset Forward-Looking Statements

Pharmasset "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release that are not historical facts are "forward-looking statements," that involve risks, uncertainties, and other important factors, including, without limitation, the risk of cessation or delay of any of the ongoing or planned clinical trials and/or our development of our product candidates, the risk that the results of previously conducted studies involving our product candidates will not be repeated or observed in ongoing or future studies involving our product candidates, the risk that our collaboration with Roche will not continue or will not be successful, and the risk that any one or more of our product candidates will not be successfully developed and commercialized. For a discussion of risks, uncertainties, and other important factors, any of which could cause our actual results to differ from those contained in the forward-looking statements, see the section entitled "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended September 30, 2010 and our Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission and discussions of potential risks, uncertainties, and other important factors in our subsequent filings with the Securities and Exchange Commission.

SOURCE Pharmasset, Inc.

RELATED LINKS
http://www.pharmasset.com

Pharmasset's PSI-7977 deemed having "Blockbuster potential"...

Hold your horses, I think an analyst used this to describe VX-222 at one time...

Associated Press
Pharmasset climbs as analyst raises target
Associated Press, 07.05.11, 12:23 PM EDT

NEW YORK -- Shares of hepatitis C drug developer Pharmasset Inc. rose Tuesday after a Canaccord Genuity analyst raised his price target on the stock.

THE SPARK: Analyst George Farmer assumed coverage of the stock, maintaining a "Buy" rating and raising the price target to $160 per share from $57. He said Pharmasset ( VRUS - news- people )'s hepatitis drug candidate PSI-7977 has "blockbuster potential" and its pipeline is promising, as another hepatitis C treatment has also looked very effective in earlier studies.

THE BIG PICTURE: The Princeton, N.J., company said last month that it will expand a trial of PSI-79777 to see if it is effective for patients who have not responded to other hepatitis C drugs and to see if it can eliminate the virus in eight weeks instead of the normal 12 weeks. The changes indicate the drug is working well in the study. PSI-7977 is years away from reaching the market, as Pharmasset plans to report mid-stage trial results later in 2011 and will have to conduct late-stage trials after that.

SHARE ACTION: Pharmasset stock rose $3.59, or 3.2 percent, to $116.33 in midday trading. Shares have traded between $23.56 and $135.92 over the past year.

Pharmasset Announces the Expansion of the ELECTRON Trial in Chronic Hepatitis C

Pharmasset adding arms to it's genotype 2/3 ELECTRON trial looking at shorter durations of therapy in addition to inteferon-free monotherapy for it's PSI-7977 nucleotide analog. Nucs traditionally have a very high barrier to resistance in comparison to non-nucs, but with a virus capable of making every possibly mutation of itself in the course of a day, is nuc monotherapy without an immune system modulator or another viral life cycle-specific inhibitor enough, even in the relatively easy-to-treat G2 and 3 virus? If it's not, what are the odds of a PSI-7977 resistant quasispecies developing and the corresponding fitness level compared to wild type of those variants? Guess we'll find out soon enough. If anyone can shed further enlightenment, please do.

PRINCETON, N.J., June 8, 2011 /PRNewswire/ -- Pharmasset, Inc. (Nasdaq: VRUS) announced today the addition of three treatment cohorts to the ELECTRON trial of PSI-7977, a nucleotide analog polymerase inhibitor, for the treatment of chronic hepatitis C (HCV). The rapid and consistent antiviral effects and high barrier to resistance demonstrated with PSI-7977 to date provide the rationale for additional exploratory regimens in this setting. This amendment will add one arm exploring 12 weeks of PSI-7977 monotherapy (without peginterferon and ribavirin) and two arms of interferon-sparing therapy: one for 8 weeks of PSI-7977 plus peginterferon and ribavirin (Peg-IFN/RBV) in patients with HCV genotype 2 (GT2) or 3 (GT3) and one for 12 weeks of PSI-7977 plus Peg-IFN/RBV in patients with HCV genotype 1 (GT1) prior null responses.

"The combination data reported at EASL demonstrated that SVRs were achievable with two oral DAAs in the absence of peginterferon and ribavirin," stated Bill Symonds, PharmD, Pharmasset's Senior Vice President of Clinical Pharmacology and Translational Medicine, "We continue to explore the potential for removing peginterferon and ribavirin from the HCV treatment regimen. Given the encouraging data we are seeing in ELECTRON, we have decided to expand the study to investigate PSI-7977 monotherapy, as well as shorter treatment regimens based on the promising data we reported at EASL from PROTON."

Pharmasset anticipates reporting results from the first four arms of the trial (n=40) during the second half of 2011. We have submitted a number of abstracts to the 2011 American Association for the Study of Liver Diseases (AASLD) meeting, including data from the ELECTRON and PROTON trials.

About the Trial

The ELECTRON trial is an exploratory study of PSI-7977 for the treatment of chronic HCV infection. Part 1 of the trial is evaluating 12-week regimens of PSI-7977 400mg QD in combination with ribavirin (RBV) only, and in separate arms with abbreviated durations of Peg-IFN for 4, 8, or 12 weeks in treatment-naive patients with HCV GT2 or GT3. The primary endpoint of the trial is the safety and tolerability of PSI-7977 400mg QD and RBV for 12 weeks, administered with or without Peg-IFN. On May 11, 2011, Pharmasset announced the completed enrollment of Part 1 of ELECTRON in patients with HCV GT 2 or GT 3:

* PSI-7977 400mg with RBV for 12 weeks (no peginterferon);
* PSI-7977 400mg with RBV for 12 weeks; Peg-IFN weeks 1-4 only;
* PSI-7977 400mg with RBV for 12 weeks, Peg-IFN weeks 1-8 only;
* PSI-7977 400mg with Peg-IFN and RBV for 12 weeks.


In Part 2 of ELECTRON, Pharmasset will enroll an additional 30 patients into exploratory regimens of monotherapy and abbreviated durations of total therapy. Following on the first four Cohorts of ELECTRON a 5th cohort will be added to explore 7977 400mg monotherapy in treatment-naive patients with HCV GT2 or GT3:

* PSI-7977 400mg monotherapy for 12 weeks.


With the previously reported 100% SVR12 in naive GT2/3 subjects in PROTON, a 6th and 7th cohort will be added to ELECTRON to explore shorter treatment durations in both GT2/3 naive subjects and HCV GT1 subjects who have documented null responses (less than 2 log(10) IU/mL reduction in HCV RNA after 12 weeks of Peg-IFN/RBV):

* PSI-7977 400mg with Peg-IFN/RBV for 8 weeks
* PSI-7977 400mg QD with Peg-IFN/RBV for 12 weeks.


About Pharmasset

Pharmasset is a clinical-stage pharmaceutical company committed to discovering, developing, and commercializing novel drugs to treat viral infections. Pharmasset's primary focus is the development of oral therapeutics for the treatment of hepatitis C virus (HCV) infection. Our research and development efforts are focused on nucleoside/tide analogs, a class of compounds which act as alternative substrates for the viral polymerase, thus inhibiting viral replication. We currently have three clinical-stage product candidates advancing in trials in various populations. Our pyrimidine, PSI-7977, an unpartnered uracil nucleotide analog, is currently under study in three Phase 2b trials in patients with HCV genotypes 1 through 6, including abbreviated duration interferon and interferon-free regimens. Our purine, PSI-938, an unpartnered guanosine nucleotide analog, recently reported safety and efficacy data from 14 days of monotherapy as well as 14 days in combination with the pyrimidine, PSI-7977. An SVR-endpoint study of the purine-pyrimidine combination is anticipated to begin in the third quarter of 2011. Mericitabine (RG7128) continues in two Phase 2b trials and one interferon-free trial being conducted through a strategic collaboration with Roche.

Contact
Richard E. T. Smith, Ph.D.
VP, Investor Relations and Corporate Communications
Office: +1 (609) 865-0693

Forward-Looking Statements

Pharmasset "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release that are not historical facts are "forward-looking statements," that involve risks, uncertainties, and other important factors, including, without limitation, the risk of cessation or delay of any of the ongoing or planned clinical trials and/or our development of our product candidates, the risk that the results of previously conducted studies involving our product candidates will not be repeated or observed in ongoing or future studies involving our product candidates, the risk that our collaboration with Roche will not continue or will not be successful, and the risk that any one or more of our product candidates will not be successfully developed and commercialized. For a discussion of risks, uncertainties, and other important factors, any of which could cause our actual results to differ from those contained in the forward-looking statements, see the section entitled "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended September 30, 2010 and our Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission and discussions of potential risks, uncertainties, and other important factors in our subsequent filings with the Securities and Exchange Commission.

SOURCE Pharmasset, Inc.