Guru Focus: Idenix Pharmaceuticals Lagging Behind In Breakthrough Hepatitis C Drug Development

Posted on 7/13/12 on www.gurufocus.com. The author is worried about Idenix's pan-genotype nuc, IDX184. I'm not as worried, but Idenix definitely needs other drugs beside it's own to pair IDX184 with - preferably those well into Phase IIb or Phase III studies.  Those are drugs that are most likely to make it to market first, barring any errant new safety signals that would gum up the works and put pinholes in the dreams of investors everywhere. A good example to follow is Medivr/Janssen's protease inhibitor TMC435. That partnership has done an outstanding job of partnering with every company with a drug that looks hopeful, expanding their status as the 'preferred partner' drug in every combination that looks effective and safe.  On the other hand, we've learned in HIV that a good, potent, well-tolerated nuc (preferably ones with a unique resistance profile) will always come in handy. A good drug never has to worry. Only the company developing it does. 

Idenix Pharmaceuticals Lagging Behind In Breakthrough Hepatitis C Drug Development
July 13, 2012

Idenix Pharmaceuticals (IDIX) is one of the biopharmaceutical companies focused on discovering, developing and commercializing drugs for the treatment of life-threatening human viral diseases such as Hepatitis C. Hepatitis C is a form of liver disease that is passed on from one person to another through contact of bodily fluids. The Hepatitis C virus can severely damage the liver as it is asymptomatic and therefore, the effects are slowly felt over a long period of time. Hepatitis C has the potential to kill if not detected early enough.

It is estimated that 75% to 85% of Hepatitis C infections become chronic, leading to serious liver disease such as cirrhosis and may even causing liver cancer. Researchers at the Centers for Disease Control and Prevention estimate that about 50% of the 3.2 million Americans who have chronic Hepatitis C do not know about it. This is frightening to say the least, given that Hepatitis C is now estimated to be killing more Americans than HIV, the virus that causes AIDS. The Hepatitis C virus has also been found to be more prevalent in the "baby boomer" generation born between 1945 and 1964. This was a time when casual sharing of needles and drug use was the norm. I was floored to discover that the current worldwide figure of persons considered to be living with chronic viral hepatitis stands at between 480 million and 540 million, with approximately 130 million to 170 million of them infected with the Hepatitis C virus.

IDX184 is a pan-genotypic oral nucleotide polymerase inhibitor and Idenix Pharmaceutical’s lead product for the treatment of Hepatitis C. It is Idenix’s belief that the Hepatitis C treatment paradigm will evolve rapidly within the next three to five years as various companies continue to develop direct-acting antivirals (DAAs) from different drug classes. The treatments would potentially reduce the duration of treatment from one year to six months or less, increase the sustained virologic response rates and improve drug tolerability. It would also be extremely convenient as patients would be able to take all the drugs orally. I believe this is significant as the side effects associated with the combination of Interferon and Ribaravin during treatment disqualify many Hepatitis C-infected candidates from undergoing the treatment. Therefore, a breakthrough in this area would be a huge stride for Idenix and has the potential to affect its share price positively. Idenix Pharmaceuticals has also co-developed a Hepatitis B drug candidate, telbivudine, with Norvatis Pharma AG (NVS). The product is commercially sold as Tyzeka®, and Idenix Pharmaceuticals earns royalties from the product sales.

Idenix Pharmaceuticals stock began trading on July 2004 with an initial public offering of 5.8 million shares at $14 per share. On 23 April, 2012 Idenix Pharmaceuticals gained 6.5% to even out at slightly below $9. Earlier in March 2012 the share price had traded at an average of $12. Idenix Pharmaceuticals released its fourth quarter and financial results for the year ending Dec. 31, 2011 in February. Its total revenue was $7 million compared to 10.2 million in the year ending Dec. 31, 2010. The company recorded a net loss of $52 million on Dec. 31, 2011 as compared to $61.6 million on Dec. 31, 2010. The share price seems to fluctuate a lot so if you’re looking to trade in stock it is probably advisable to consider day-trading or swing-trading as compared to making a long-term investment.

Another competitor, Gilead Sciences (GILD) made astronomical progress in April 2012, when a mid-stage clinical trial revealed that a combination of the GS-7977 drug and the antiviral Ribaravin cleared the virus in approximately 88% of the patients. The GS-7977 drug was administered together with Ribaravin, completely eliminating the need for the injectable interferon. Gilead Sciences is the world’s largest HIV drug maker, so this news comes as no surprise.

Gilead’s shares have evened out at an average of $51 after they jumped from about $47 to an average of $53. These developments have clearly placed Gilead Sciences ahead of the pack, and I would not hesitate to recommend trading its shares.

Vertex Pharmaceuticals (VRTX) is also in the process of carrying out a study to evaluate the effectiveness of a Hepatitis C treatment on patients who are not on antiretroviral therapy for HIV versus those who are on a Atripla- or Reyataz-based treatment for HIV. Vertex Pharmaceuticals is carrying out the study in collaboration with Janssen, one of Johnson & Johnson (JNJ)'s pharmaceutical companies. The study is intended to evaluate the safety and tolerability of the Incivek drug combination therapy in patients infected with both the Hepatitis C virus and HIV. The drug is marketed in the U.S. and Canada and is also available in the Far East and Japan.

Vertex Pharmaceuticals stock is trading at an average of $37. January 2012 was a terrible month for Vertex with their share price dipping to $34 after an analyst at Leerink Swann reduced the sales forecast for Incivek from $2.3 billion to $1.5 billion this year, citing recent developments of interferon-free regimens and the possibility of more aggressive developments. There is a great need for Hepatitis C treatment and more so amongst those infected with HIV. If Vertex Pharmaceuticals manages to develop a drug that can be safely used to treat those co-infected with Hepatitis C and HIV then it is safe to say that it will be worth your while to invest in Vertex Pharmaceuticals.

Victrelis, a product of Merck & Co. (MRK), was approved for the U.S. market by the Food and Drug Administration just last year for the treatment of Hepatitis C. It is surprising therefore when I learned from my research that the drug’s effectiveness is lowered when used in combination with some antiretroviral therapy drugs. It’s not all bad news though. Merck recently agreed to pay Endocyte (ECYT) up to $1 billion to develop and commercially market Vintafolide, an experimental cancer drug. Merck will own all the global rights meaning that a surge in sales will push its share price upwards. Merck is currently trading at an average of $28 and its future outlook does not look very promising at the moment.

Abbot Laboratories (ABT)'s main line of business is in the discovery, development, manufacture and sale of a wide range of health care products. Abbot Laboratories released data earlier in April 2012 from a mid-stage clinical trial that indicated combining ABT-450 boosted by an antiviral, Ritonavir, along with Ribaravin and a polymerase inhibitor achieved a 95% cure rate. Deutsche Bank consequently boosted Abbot Laboratories rating to “Buy” in March 2012 with a price target of $70. The share price is currently trading at slightly under $60. I’d say this is pretty close to what analysts at Deutsche Bank projected. Abbot Laboratories is in the process of separating into two healthcare companies by the end of the year, so it is advisable to carry out day trading and keep a close eye on the share price.

Merck and Codex go "green" with new production process for Victrelis...

Article posted 4/10/12 on InPharm.com - Pressures on price continue to increase and with large patent expirations on the horizon, what's a Big Pharma company to do to maintain shareholder-friendly profitability levels?? One answer is to create better efficientcies in the drug production process, thereby dropping the price and (hopefully) creating bigger margins. And if you can do it 'green', well, that's some corporate goodwill for you.   Merck has teamed up with catalyst Codexis to develop a more efficient production process for Merck's HCV protease inhibitor, Victrelis. Codexis fits into a very interesting niche that will certainly maintain appeal to drug manufacturers as the pressure to drop prices increases. Definitely a niche I'm going to make an effort to watch in the coming years. 

Codexis and Merck develop green Victrelis production

Published on 10/04/12 at 12:23pm

Merck has teamed up with catalyst specialist Codexis to develop a more efficient manufacturing process for recently-approved hepatitis C treatment Victrelis.

Merck was granted approval for NS3/4A protease inhibitor Victrelis (boceprevir) in the US last May and in Europe the following July.

Sales of the product have quickly ramped up to reach nearly $90 million in the fourth quarter of 2011 and $140 million for the full year, despite being available only in a handful of markets.

Analysts have tipped Victrelis as a future blockbuster, and Merck has enlisted the aid of Codexis to make the production process more efficient and boost its profit margin for the drug at a time when the firm is facing patent expiries on some key product lines.

Merck and Codexis scientists developed an enzyme-based production method for a key intermediate in the production of boceprevir that has been recently published in the Journal of the American Chemical Society (JACS).

The JACS publication describes the creation and characterisation of a biocatalyst that was capable of performing a key step in the synthesis of boceprevir.

The new method increased chemical intermediate yield 150% over the previous process, according to the paper. Moreover, it reduced raw material use by 60%, water use by 61% and overall process waste by 63%, making the manufacturing process greener.

"Incorporation of innovative environmentally sustainable means of manufacture is a key aspect of our research and development strategy," commented Richard Tillyer, senior vice president for Discovery and Preclinical Sciences at Merck Research Laboratories.

"Enzymatic based methods can offer a biodegradable and renewable alternative to currently employed methods."

Biocatalysts - generally based on enzymes - have been used on a small scale in the pharmaceutical industry for many years, but it is only in the last few years that they have migrated into the commercial-scale manufacturing environment.

Pressures on the profitability of drugmakers have encouraged the industry to cut costs and boost efficiencies across the board, including in manufacturing, and Codexis has tapped into that trend.

Last year the company reported sales growth of 16% to $124 million that it said was "driven by increased sales to both generic and innovator pharmaceutical customers".

Phil Taylor

British Columbia expands HCV coverage to include Victrelis...

Article posted on 3/26/12 via Vancouver 24 hours. Looks like Victrelis is now available in British Columbia via PharmaCare for patients with genotype 1 infection. 

B.C. expands coverage for hep C

By ERICA BULMAN, 24 HOURS

PharmaCare coverage for eligible patients with chronic hepatitis C (genotype 1) is being expanded to include the drug boceprevir, approved by Health Canada in July 2011.

New hep C patients who haven’t been treated, those who have relapsed after treatment or responded only partially to another treatment, will be eligible.

Boceprevir is taken in combination with two other drugs — peginterferon and ribavirin — over 24 to 44 weeks.

“The rapid approval of boceprevir is a major step forward towards the potential future elimination of hepatitis C infections in British Columbians,” said Dr. Mel Krajdenof the BC Centre for Disease Control. “Viral cure is known to reduce mortality, improve quality of life and prevent progression of liver disease.”

Without PharmaCare or private drug plan coverage, boceprevir would cost patients about $1,050 per week, the province estimated.

In clinical trials, patients who’d never received treatment and took the boceprevir combination had a 25% higher cure rate over those who didn’t.

In patients unsuccessful in other therapies, the boceprevir cure rate was 38% higher than those who received peginterferon and ribavirin alone.

There are about 64,000 British Columbians currently diagnosed with hep C, 25% of whom have cleared their infection without treatment, according to the province.

Untreated the disease can result in liver failure and death.

HCAB Position Statement: Hepatitis C Drug Development and Drug-Drug Interaction Studies...

This HCAB (Hepatitis C Community Advisory Board) position statement was published on 2/28/12 regarding Hepatitis C drug development and drug-drug interaction (DDI) studies. In short, the HCAB would like drug developers to be more proactive in doing DDI studies before the drugs come to market. They admonish Merck specifically for not doing DDI studies with commonly available antiretrovirals and their HCV antiviral drug, boceprevir. Further, they applaud the efforts of Vertex and J&J for doing full due diligence in DDI studies prior to the launch of Telaprevir. 

HCAB Position Statement: Hepatitis C Drug Development and Drug-Drug Interaction Studies

February 17, 2012 -- The Hepatitis C Community Advisory Board (HCAB) recognizes the value of more effective and less toxic treatment for hepatitis C virus (HCV). We believe that sponsors can conduct key drug-drug interaction (DDI) studies with direct-acting antivirals (DAAs) and other candidates in development and medications commonly used by people with hepatitis C and those coinfected with HIV/HCV prior to their approval, without delaying development of these important therapies.

DAAs may share metabolic pathways with drugs that are commonly used by populations with a high prevalence of hepatitis C, such as hormonal contraceptives, methadone, buprenorphine, lipid-lowering agents, immunosuppressive drugs, herbal remedies, and commonly prescribed psychiatric medications.

In recognition of the suboptimal efficacy and tolerability of [pegylated interferon] and ribavirin, rapid trajectory of liver disease progression, and increasing mortality from HCV-related complications among HIV/HCV coinfected patients, regulators in the US and the EU encourage sponsors to conduct trials in HIV/HCV coinfected patients prior to approval for HCV monoinfection. Sponsors have already opened, or plan to launch these trials.

The recent discovery of drug-drug interactions between boceprevir and boosted HIV protease inhibitors underscores the importance of DDI studies with DAAs. Although we commend the sponsor, Merck, for opening one of the first coinfection trials with a DAA, we were outraged that Merck chose not to conduct DDIs with commonly used antiretroviral agents prior to launching the trial, and prior to gaining approval for boceprevir. Vertex and Tibotec were able to bring telaprevir [Incivek] to market with a much fuller portfolio of DDI data, although both drugs were developed within the same timeframe.

HCAB asks FDA [the US Food and Drug Administration], EMA [European Medicines Agency] and pharmaceutical companies to work together to minimize potential harm to hepatitis C monoinfected and HIV/HCV coinfected patients from uncharacterized drug-drug interactions. Furthermore, we call upon sponsors to perform DDI studies (as indicated by metabolic profile of their drug or drugs) with DHHS [US Department of Health and Human Services], EACS [European AIDS Clinical Society] and WHO [World Health Organization]-recommended antiretroviral agents for first-line, and treatment-experienced HIV/HCV coinfected people prior to approval, and strongly encourage studies of hormonal contraceptives, methadone, buprenorphine, lipid-lowering agents, immunosuppressive drugs, herbal remedies, and commonly prescribed psychiatric medications.

2/28/12

Source

Hepatitis C Community Advisory Board. HCAB Position Statement: Hepatitis C Drug Development and Drug-Drug Interaction Studies. February 16, 2012.

Merck posts 'Dear Doctor' letter regarding use of Victrelis with boosted HIV protease inhibitors...

Thank you NATAP.org. DHCP letter that came out today (Feb 6th, 2012) regarding drug-drug interactions with Boceprevir and ritonovir-boosted PIs. In short. "Merck does not recommend the coadministration of VICTRELIS and ritonavir-boosted HIV protease inhibitors." 



S. Sethu K. Reddy, MD Merck & Co., Inc.


Vice President PO Box 250

US Medical Affairs West Point, PA 19486-0250


February 6, 2012

IMPORTANT DRUG WARNING

SUBJECT: Results of Pharmacokinetic Study in Healthy Volunteers Given VICTRELIS™

(boceprevir) and Ritonavir-Boosted HIV Protease Inhibitors May Indicate Clinically Significant Drug

Interactions for Patients Coinfected with Chronic Hepatitis C and HIV


Dear Health Care Professional,

The purpose of this communication is to inform you of recent pharmacokinetic study results evaluating drug

interactions between VICTRELIS, an oral chronic hepatitis C virus (HCV) NS3/4A protease inhibitor, and

ritonavir-boosted human immunodeficiency virus (HIV) protease inhibitors in healthy volunteers (n=39).

VICTRELIS is indicated for the treatment of chronic hepatitis C virus (HCV) genotype 1 (G1) infection, in

combination with peginterferon alfa and ribavirin (PR), in adult patients (18 years and older) with

compensated liver disease, including cirrhosis, who are treatment-naïve or who have failed previous

interferon and ribavirin therapy. In the pharmacokinetic study, concomitant administration of VICTRELIS

with Norvir® (ritonavir) in combination with Reyataz® (atazanavir) or Prezista® (darunavir), or with Kaletra®

(lopinavir/ritonavir) resulted in reduced exposures of the HIV medicines and VICTRELIS. Specifically,

VICTRELIS reduced mean trough concentrations of ritonavir-boosted atazanavir, lopinavir, and darunavir

by 49%, 43%, and 59%, respectively. Mean reductions of 34% to 44% and 25% to 36% were observed in

AUC and Cmax of atazanavir, lopinavir, and darunavir. Coadministration of ritonavir-boosted atazanavir with

VICTRELIS did not alter the exposure of VICTRELIS, but coadministration of VICTRELIS with

lopinavir/ritonavir or ritonavir-boosted darunavir decreased the exposure of VICTRELIS by 45% and 32%,

respectively.

These drug interactions may be clinically significant for patients infected with both chronic HCV and HIV by

potentially reducing the effectiveness of these medicines when coadministered. VICTRELIS is not indicated

for use in patients who are infected with both HIV-1 and chronic HCV. The safety and efficacy of

VICTRELIS™ (boceprevir) has not been established in this coinfected population. Merck does not

recommend the coadministration of VICTRELIS and ritonavir-boosted HIV protease inhibitors.

Health care providers who might have initiated VICTRELIS in combination with PR in HIV-HCV coinfected

patients on fully suppressive antiretroviral therapy containing a ritonavir-boosted protease inhibitor should

discuss these findings with those patients, and closely monitor those patients for HCV treatment response

and for potential HCV and HIV virologic rebound.

Patients should be advised to contact their health care provider before stopping any of their

medications.

Merck is sharing these pharmacokinetic data with regulatory authorities in the countries where VICTRELIS

is approved. Merck will be submitting requests to regulators to update the product labeling with these data.

These data have been submitted for scientific presentation at an upcoming medical forum.

For more information, please consult the enclosed Prescribing Information for VICTRELIS. The Prescribing

Information can also be found at http://www.merck.com/product/usa/pi_circulars/v/victrelis/victrelis_pi.pdf.

Should you have any questions, require further information on product safety, or wish to report an adverse

event with VICTRELIS, please contact Merck at 1-877-888-4231. Alternatively, an adverse event can be

reported directly to the FDA at 1-800-FDA-1088 or www.fda.gov/medwatch.

Sincerely,

S. Sethu K. Reddy, MD

Enclosure: Prescribing Information for VICTRELIS

- 3 -

Indications and Usage for VICTRELISTM (boceprevir)

VICTRELIS was approved by the US Food and Drug Administration (FDA) on May 13, 2011 for the

treatment of chronic hepatitis C virus (HCV) genotype 1 (G1) infection, in combination with peginterferon

alfa and ribavirin (PR), in adult patients (18 years and older) with compensated liver disease, including

cirrhosis, who are previously untreated or who have failed previous interferon and ribavirin therapy.

The following points should be considered when initiating VICTRELIS for treatment of chronic HCV

infection:

• VICTRELIS must not be used as monotherapy and should only be used in combination with PR.

• VICTRELIS efficacy has not been studied in patients who have previously failed therapy with a treatment

regimen that includes VICTRELIS or other HCV NS3/4A protease inhibitors.

• VICTRELIS in combination with PR has not been studied in patients documented to be historical null

responders (<2-log10 HCV-RNA decline by Treatment Week 12) during prior therapy with PR. The clinical

studies included subjects who were poorly interferon responsive. Subjects with <0.5-log10 HCV-RNA

decline in viral load at Treatment Week 4 with PR alone are predicted to have a null response (<2-log10

viral load decline at Treatment Week 12) to PR therapy.

• Poorly interferon responsive patients who were treated with VICTRELIS in combination with PR have a

lower likelihood of achieving a sustained virologic response (SVR), and a higher rate of detection of

resistance-associated substitutions upon treatment failure, compared to patients with a greater response

to PR.

Selected Safety Information for VICTRELIS

All contraindications to PR also apply since VICTRELIS must be administered with PR.

Because ribavirin may cause birth defects and fetal death, VICTRELIS in combination with PR is

contraindicated in pregnant women and in men whose female partners are pregnant. Avoid pregnancy in

female patients and female partners of male patients. Patients must have a negative pregnancy test prior to

therapy; have monthly pregnancy tests; and use 2 or more forms of effective contraception, including

intrauterine devices and barrier methods, during treatment and for at least 6 months after treatment has

concluded. Systemic hormonal contraceptives may not be as effective in women while taking VICTRELIS

and concomitant ribavirin.

VICTRELIS is contraindicated in coadministration with drugs that are highly dependent on CYP3A4/5 for

clearance, and for which elevated plasma concentrations are associated with serious and/or life-threatening

events. VICTRELIS is also contraindicated in coadministration with potent CYP3A4/5 inducers, where

significantly reduced VICTRELIS plasma concentrations may be associated with reduced efficacy.

Drugs that are contraindicated with VICTRELIS include: alfuzosin, carbamazepine, phenobarbital,

phenytoin, rifampin, dihydroergotamine, ergonovine, ergotamine, methylergonovine, cisapride, St. John’s

Wort (hypericum perforatum), lovastatin, simvastatin, drosperinone, Revatio® (sildenafil) or Adcirca®

(tadalafil) (when used for the treatment of pulmonary arterial hypertension), pimozide, triazolam, and orally

administered midazolam.

- 4 -

Anemia and/or Neutropenia – The addition of VICTRELIS™ (boceprevir) to PR is associated with an

additional decrease in hemoglobin concentrations compared with PR alone and/or may result in worsening

of neutropenia associated with PR therapy alone. Dose reduction or discontinuation of peginterferon alfa

and/or ribavirin may be required. Dose reduction of VICTRELIS is not recommended. VICTRELIS must not

be administered in the absence of PR.

Complete blood count (with white blood cell differential counts) must be conducted in all patients prior to

initiating combination therapy with VICTRELIS. Complete blood counts should be obtained at Treatment

Weeks 4, 8, and 12, and should be monitored closely at other time points, as clinically appropriate.

The most commonly reported adverse reactions (>35%) in clinical trials in adult patients receiving the

combination of VICTRELIS with PR were: fatigue, anemia, nausea, headache, and dysgeusia. Of these

commonly reported adverse reactions, fatigue, anemia, nausea, and dysgeusia occurred at rates ≥5%

above the rates for PR alone in either clinical study. The incidence of these adverse reactions in previously

untreated subjects that were treated with combination therapy with VICTRELIS compared with PR alone

were: fatigue (58% vs 59%), anemia (50% vs 30%), nausea (46% vs 42%), and dysgeusia (35% vs 16%),

respectively. The incidence of these adverse reactions in previous treatment failure patients that were

treated with combination therapy with VICTRELIS compared with PR alone were: fatigue (55% vs 50%),

anemia (45% vs 20%), nausea (43% vs 38%), and dysgeusia (44% vs 11%), respectively.

VICTRELIS is a strong inhibitor of CYP3A4/5 and is partly metabolized by CYP3A4/5. The potential for

drug-drug interactions must be considered prior to and during therapy.

Merck reports increased Victrelis sales in Q4 2011...

Posted on 2/2/12 on Zacks.com - Merck reveals Q4 financials, beating EPS speculations. For us HCV drug development wonks, we find Victrelis on an upward trajectory, with sales increasing to $87 million, up from $31 million and $21 million reported in the 3rd and 2ndquarters of 2011. They boast of a huge formulary win, that of the Veterans Health Administration, the nation's largest provider of Hepatitis C care.

Merck Beats on EPS, Guides In-Line
By: Zacks Equity Research
February 02, 2012 |Comments: 0

Merck & Co. (MRK) reported fourth quarter 2011 earnings per share (excluding special items) of 97 cents, a couple of cents above the Zacks Consensus Estimate and 10.2% above the year-ago earnings.

Revenues for the quarter increased 1.7% to $12.3 billion, just shy of the Zacks Consensus Estimate of $12.5 billion. Including one-time items, Merck swung to a profit of 49 cents per share from the year-ago loss of 17 cents.

The company reported full-year earnings of $3.77 per share, a penny above Zacks Consensus Estimate and 10.2% above the year-ago earnings. Earnings exceeded the top end of the company’s guidance range of $3.72 - $3.76 per share. Full-year revenues increased 4.5% to $48 billion, slightly below the Zacks Consensus Estimate of $48.2 billion. Including one-time items, Merck earned $2.02 per share, well above the year-ago earnings of 28 cents.

The Quarter in Details

Merck’s Pharmaceutical segment posted sales of $10.8 billion, up 3%. Products like Januvia, Janumet, Singulair, Isentress and Gardasil contributed to sales. However, the strong performance of these products was partially offset by lower sales of Vytorin. Remicade sales also declined during the quarter.

Singulair, indicated for the chronic treatment of asthma and relief of symptoms of allergic rhinitis, recorded $1.5 billion in sales, up 8% from the year-ago period. However, Singulair sales will experience a severe decline following its US patent expiry in August 2012.

Meanwhile, with Merck transferring exclusive marketing rights for Remicade and Simponi to Johnson & Johnson (JNJ), Remicade and Simponi combined sales fell 24%. We expect Merck to focus on improving penetration rates and drive growth in Europe, Russia and Turkey.

Isentress, the company’s product for HIV infection, recorded an increase of 24% to $387 million during the reported quarter.

The diabetes franchise, consisting of Januvia and Janumet, continued to perform well, and witnessed growth across all regions. Combined sales increased 40% to $1.3 billion. While Januvia sales increased 42% to $960 million, Janumet sales increased 34% to $386 million. Merck is working on increasing sales of its diabetes franchise by gaining approval for additional indications. The diabetes franchise should benefit from the recent approval of Juvisync, which is a combination of Januvia and Zocor.

Gardasil, Merck’s cervical cancer vaccine, recorded sales of $274 million, up 24% year over year. Sales were driven by increased vaccination of males aged 9-26 years. Zostavax sales came in at $78 million with performance being driven by an improvement in the supply situation. Merck reported that it has filled all backorders and the supply situation has returned to normal in the US.

Meanwhile, Merck’s ProQuad, MMR II and Varivax vaccines recorded combined sales of $276 million, down 3%. Vytorin sales fell 16% to $475 million during the quarter.

Merck provided an update on its recently approved hepatitis C treatment, Victrelis (boceprevir). Sales increased to $87 million, up from $31 million and $21 million reported in the third and second quarters of 2011, respectively. We were encouraged to see the sequential improvement in Victrelis sales.

According to the company, Victrelis was added to the VA formulary, which is the largest single provider of services to hepatitis C patients in the US. This represents a significant commercial opportunity for Victrelis.

Merck has an agreement with Roche (RHHBY) for the global marketing of Victrelis as part of a triple combination therapy. Victrelis is available in the US and 19 other countries.

Emerging markets accounted for 17% of pharmaceutical sales in the fourth quarter of 2011 with China continuing to put in a strong performance.

Merck’s animal health segment posted sales of $868 million, up 6%. Increased sales of companion animal, swine and poultry products helped drive growth.

Consumer Care sales fell 5% to $361 million in the fourth quarter of 2011, mainly due to lower sales of Claritin and Coppertone.

Total costs declined 1.4% to $8.6 billion. Marketing and administrative expenses increased 5.9% to $3.6 billion in the fourth quarter of 2011 due to the impact of product launches, US health care reform fees and corporate charges. R&D spend declined 4.8% to $2.1 billion in the fourth quarter of 2011, mainly due to efficiency savings.

In-Line Guidance for 2012

With the release of fourth quarter results, Merck provided its outlook for 2012. The company expects adjusted earnings in the range of $3.75 - $3.85 per share. Guidance was in line with expectations -- the Zacks Consensus Estimate currently stands towards the higher end of the guidance range at $3.83 per share.

Revenues are expected to remain flat or close to 2011 levels. The company said that revenues would be negatively impacted by 2-3% at current exchange rates.

Merck expects R&D spend to remain at similar levels as in 2011. The company spent $7.7 billion on R&D in 2011. The company’s late-stage pipeline is advancing with five regulatory filings expected in 2012 and 2013. These include Bridion (a neuromuscular reversal agent), V503 (an investigational vaccine to help protect against certain HPV associated cancers), odanacatib (once-weekly oral treatment of osteoporosis), Tredaptive (atherosclerosis) and suvorexant (insomnia).

Neutral on Merck

We currently have a Neutral recommendation on Merck, which carries a Zacks #3 Rank (short-term Hold rating). Merck is entering a challenging period with its biggest product, Singulair, slated to lose US exclusivity in August. Singulair sales came in at $5.5 billion in 2011, accounting for 13.3% of Pharmaceutical sales.

We believe Merck will continue resorting to cost-cutting initiatives to drive the bottom-line. Meanwhile, some of the company’s recent launches should start contributing significantly to the top line in the forthcoming quarters.

Merck & Roche team up for HCV product trials..

The unlikely pairing of these former arch-enemies and Hepatitis C juggernauts Merck and Roche continue to raise eyebrows. This time, the duo had agreed to a series of planned clinical trials to investigate combinations of currently marketed and investigational compounds to treat HCV, with a focus on the genotype 1 population. The first appears to be a phase II study called DYNAMO 1, which will look at Boceprevir in combination with with Roche's mericitabine (RO5024048), their oral HCV NS5B nucleoside polymerase inhibitor in combination with pegylated interferon (Pegasys, for those keeping a scorecard) and ribavirin in genotype 1 patients with a prior null response to P/R. The fact that there doesn't appear to be an interferon-free arm leads me to believe that these two interferon giants do not believe that prior null responders can be cured without interferon, which, to their credit, may indeed be the case.

Merck Announces Initiation of Clinical Development Collaboration with Roche To Evaluate Investigational Combination Regimens for the Treatment of Chronic Hepatitis C Genotype 1 Infection

New Clinical Trial Will Evaluate an Investigational Therapeutic Regimen with VICTRELIS™ (boceprevir)

WHITEHOUSE STATION, N.J., Dec. 15, 2011 - Merck (NYSE: MRK), known as MSD outside the United States and Canada, announced today that Merck, in collaboration with Roche (SIX: RO, ROG; OTCQX: RHHBY), has initiated the first of a series of planned clinical trials to examine novel combinations of marketed and investigational medicines to expedite the availability of potential new treatment regimens for patients with chronic hepatitis C virus (HCV) genotype 1 infection. Clinical development collaboration is part of the overarching strategic agreement between Merck and Roche to improve treatment, diagnosis and awareness of chronic HCV in developed and emerging markets.

"VICTRELIS is the first in a new class of medicines for the treatment of chronic HCV genotype 1 infection, and when used in combination with peginterferon alfa, can significantly increase a patient's chance of achieving undetectable levels of the virus," said Eliav Barr, M.D., vice president, Infectious Diseases Project Leadership and Management, Merck Research Laboratories. "The start of this new study is an important milestone in our collaboration with Roche as we work to build on the innovative platform VICTRELIS provides by evaluating it in combination therapy with new investigational medicines for the treatment of chronic HCV genotype 1 infection, and also emphasizes our ongoing commitment to seeking novel treatment options for patients with chronic HCV."

The first trial is designed to provide clinical data on the use of VICTRELIS™ (boceprevir), an oral HCV NS3/4A protease inhibitor, in combination with mericitabine (RO5024048), Roche's investigational oral HCV NS5B nucleoside polymerase inhibitor, Pegasys® (pegylated interferon alfa-2a) and Copegus® (ribavirin), in adult patients with chronic HCV genotype 1 infection who had a null response to prior peginterferon alfa and ribavirin therapy (less than a 2 log HCV-RNA decline at treatment week 12). The Phase II study, called DYNAMO 1, plans to recruit patients at 25 sites globally. For further details of the clinical trial please visit www.clinicaltrials.gov, or contact (888) 662-6728 (U.S. only) or Genentechclinicaltrials@drug info.com.

Indications and usage for VICTRELIS
VICTRELIS was approved by the U.S. Food and Drug Administration (FDA) on May 13, 2011 for the treatment of chronic hepatitis C virus (HCV) genotype 1 (G1) infection, in combination with peginterferon alfa and ribavirin (P/R), in adult patients (18 years and older) with compensated liver disease, including cirrhosis, who are previously untreated or who have failed previous interferon and ribavirin therapy.

The following points should be considered when initiating VICTRELIS for treatment of chronic HCV infection:

•VICTRELIS must not be used as monotherapy and should only be used in combination with peginterferon alfa and ribavirin.



•VICTRELIS efficacy has not been studied in patients who have previously failed therapy with a treatment regimen that includes VICTRELIS or other HCV NS3/4A protease inhibitors.



•VICTRELIS in combination with peginterferon alfa and ribavirin has not been studied in patients documented to be historical null responders (less than a 2 log HCV-RNA decline by treatment week 12) during prior therapy with peginterferon alfa and ribavirin. The clinical studies included patients who were poorly interferon responsive. Patients with less than 0.5 log HCV-RNA decline in viral load at treatment week 4 with peginterferon alfa plus ribavirin alone are predicted to have a null response (less than a 2 log viral load decline by treatment week 12) to peginterferon alfa and ribavirin therapy.



•Poorly interferon responsive patients who were treated with VICTRELIS in combination with peginterferon alfa and ribavirin have a lower likelihood of achieving a sustained virologic response (SVR), and a higher rate of detection of resistance-associated substitutions upon treatment failure, compared to patients with a greater response to peginterferon alfa and ribavirin.



Important safety information about VICTRELIS
All contraindications to peginterferon alfa and ribavirin also apply since VICTRELIS must be administered with peginterferon alfa and ribavirin. Because ribavirin may cause birth defects and fetal death, VICTRELIS in combination with peginterferon alfa and ribavirin is contraindicated in pregnant women and in men whose female partners are pregnant. Avoid pregnancy in female patients and female partners of male patients. Patients must have a negative pregnancy test prior to therapy; have monthly pregnancy tests; and use two or more forms of effective contraception, including intrauterine devices and barrier methods, during treatment and for at least 6 months after treatment has concluded. Systemic hormonal contraceptives may not be as effective in women while taking VICTRELIS and concomitant ribavirin.

VICTRELIS is contraindicated in coadministration with drugs that are highly dependent on CYP3A4/5 for clearance, and for which elevated plasma concentrations are associated with serious and/or life-threatening events. VICTRELIS also is contraindicated in coadministration with potent CYP3A4/5 inducers where significantly reduced VICTRELIS plasma concentrations may be associated with reduced efficacy. Drugs that are contraindicated with VICTRELIS include: alfuzosin, carbamazepine, phenobarbital, phenytoin, rifampin, dihydroergotamine, ergonovine, ergotamine, methylergonovine, cisapride, St. John's Wort (hypericum perforatum), lovastatin, simvastatin, drosperinone, Revatio® (sildenafil) or Adcirca® (tadalafil) (when used for the treatment of pulmonary arterial hypertension), pimozide, triazolam, and orally administered midazolam.

Anemia and neutropenia have been reported with peginterferon alfa and ribavirin therapy. The addition of VICTRELIS to peginterferon alfa and ribavirin is associated with an additional decrease in hemoglobin concentrations compared to peginterferon alfa and ribavirin alone and/or may result in worsening of neutropenia associated with peginterferon alfa and ribavirin therapy alone. Dose reduction or discontinuation of peginterferon alfa and/or ribavirin may be required. Dose reduction of VICTRELIS is not recommended. VICTRELIS must not be administered in the absence of peginterferon alfa and ribavirin.

Complete blood counts (with white blood cell differential counts) must be conducted in all patients prior to initiating combination therapy with VICTRELIS. Complete blood counts should be obtained at treatment weeks 4, 8 and 12, and should be monitored closely at other time points, as clinically appropriate.

The most commonly reported adverse reactions (greater than 35 percent) in clinical trials in adult patients receiving the combination of VICTRELIS with peginterferon alfa and ribavirin were fatigue, anemia, nausea, headache and dysgeusia. Of these commonly reported adverse reactions, fatigue, anemia, nausea, and dysgeusia occurred at rates greater than or equal to 5 percent above the rates for peginterferon alfa and ribavirin alone in either clinical study. The incidence of these adverse reactions in previously untreated patients who were treated with combination therapy with VICTRELIS compared with peginterferon and ribavirin alone were: fatigue (58 vs. 59 percent), anemia (50 vs. 30 percent), nausea (46 vs. 42 percent) and dysgeusia (35 vs. 16 percent), respectively. The incidence of these adverse reactions in previous treatment-failure patients who were treated with combination therapy with VICTRELIS compared with peginterferon and ribavirin alone were: fatigue (55 vs. 50 percent), anemia (45 vs. 20 percent), nausea (43 vs. 38 percent) and dysgeusia (44 vs. 11 percent), respectively.

VICTRELIS is a strong inhibitor of CYP3A4/5 and is partly metabolized by CYP3A4/5. The potential for drug-drug interactions must be considered prior to and during therapy.

Please see U.S. prescribing information at: http://www.merck.com/product/usa/pi_circulars/v/victrelis/victrelis_pi.pdf.

Merck's global commitment to advancing hepatitis therapy
Merck is committed to building on its strong legacy in the field of viral hepatitis by continuing to discover, develop and deliver vaccines and medicines to help prevent and treat viral hepatitis. In hepatitis C, company researchers developed the first approved therapy for chronic HCV in 1991 and the first combination therapy in 1998. In addition to ongoing studies with VICTRELIS, extensive research efforts are underway to develop additional innovative oral therapies for viral hepatitis care.

About Merck
Today's Merck is a global healthcare leader working to help the world be well. Merck is known as MSD outside the United States and Canada. Through our prescription medicines, vaccines, biologic therapies, and consumer care and animal health products, we work with customers and operate in more than 140 countries to deliver innovative health solutions. We also demonstrate our commitment to increasing access to healthcare through far-reaching policies, programs and partnerships. For more information, visit www.merck.com and connect with us on Twitter, Facebook and YouTube.

Forward-Looking Statement
This news release includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, statements about the benefits of the merger between Merck and Schering-Plough, including future financial and operating results, the combined company's plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Merck's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the possibility that the expected synergies from the merger of Merck and Schering-Plough will not be realized, or will not be realized within the expected time period; the impact of pharmaceutical industry regulation and health care legislation; the risk that the businesses will not be integrated successfully; disruption from the merger making it more difficult to maintain business and operational relationships; Merck's ability to accurately predict future market conditions; dependence on the effectiveness of Merck's patents and other protections for innovative products; the risk of new and changing regulation and health policies in the United States and internationally and the exposure to litigation and/or regulatory actions.

Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in Merck's 2010 Annual Report on Form 10-K and the company's other filings with the Securities and Exchange Commission (SEC) available at the SEC's Internet site (www.sec.gov).

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

Dendreon Corporation sells it's royalty stream for Victrelis...

Dendreon Selling Royalty Interest Of Hepatitis C Treatment To Boost Cash Position
Tuesday, December 06, 2011 1:07 PM

Dendreon Corp. (NASDAQ:DNDN),a biotechnology company, has agreed to sell its royalty interest associated with VICTRELIS, a treatment for chronic hepatitis C, for $125 million to boost its cash position.

The intellectual property related to VICTRELIS was co-developed by Corvas International, Inc. and Merck's unit Schering and, was acquired by Dendreon in July 2003.

The royalty interest was acquired by CPPIB Credit Investments Inc., a subsidiary of Toronto-based CPP Investment Board (CPPIB).

The transaction is expected to close this month.

VICTRELIS was approved by the U.S. Food and Drug Administration (FDA) on May 13, 2011. Dendreon’s first product, PROVENGE was approved by the FDA in April 2010.

Seattle, Washington-based Dendreon is trading unchanged at $8.80 at 12.35 pm EST. The stock has been trading in the 52-week range between $6.46 and $43.96.

Seeking Alpha.com's Chris Katje on Gilead potential for antiviral dominance...

A bullish outlook for Gilead from Seeking Alpha author Chris Katje. His view is that Gilead will have market dominance in both HIV and HCV. He sees that Gilead will have full control of the Pharmasset HCV portfolio through the buyout, thus negating any worry about royalty payments. I'd also add the potential for co-formulation between Pharmasset's portfolio and Gilead's current HCV portfolio, which has always been Gilead's hallmark. An interesting read and it seems the rest of the market seems to agree with Katje, as Gilead stock has received several outlook upgrades from analysts. It just took some time for the initial sticker shock to wear off.

Acquisition of Pharmasset

Gilead Sciences (GILD) announced its intent to acquire Pharmasset (VRUS) for a whopping $11 billion on Monday morning. The deal has led many analysts and investors to question if Gilead overpaid for the deal. I think the deal is a great long-term play for the company and actually could present a buying opportunity of shares, which were down sharply after the announcement. Shares were up around five percent the following day after the announcement. Gilead will now be a large player in the HIV and Hepatitis markets.

Pharmasset has no drugs on the market, which is the biggest reason why people question the valuation. Drug candidate PSI-7977 appears to show enough promise that other companies were nibbling at acquiring the company. Gilead is confident in its acquisition and is funding the deal through cash and $6 billion in debt it is taking on. Hepatitis C is being targeted by this drug and it could actually save many Americans from the life threatening liver damage that is usually caused by the disease and leads to many liver transplants. The drug is expected to be filed with the Food and Drug Administration in 2014. Pharmasset owned the worldwide rights to the drug so Gilead will take full control and will not have to worry about licensing or royalty payments. Gilead now will be the leader in the race to find an all oral drug for the treatment of Hepatitis C.

Why the Acquisition and Hefty Premium

Gilead presented a slide show on its website shortly after the announcement to acquire Pharmasset. Gilead reconfirmed its goal of creating the best Hepatitis C drug, which would be determined by some of the following:

Taken Once Daily
Manageable Side Effects
Higher Cure Rates Than Current Drugs on the Market
Increased Treatments With a New Drug

Gilead has recognized that a combination of two or more drugs may be needed to create this super Hepatitis C drug. This is where I believe that Gilead’s acquisition will ultimately pay off. Gilead has combined several of its own drugs with products of other companies to create better acting and more effective drugs for patients.

Competition in Hepatitis C Market

Several other Hepatitis C drugs have popped up on the market recently. Victrelis is a drug owned by Merck (MRK), acquired through its acquisition of Schering Plough. The drug has so far been a disappointment as it only brought in $31 million of revenue in the third quarter reported on October 31, for Merck. Incivek, a drug owned by Vertex Pharmaceuticals (VRTX), on the other hand posted sales of $419 million in the past quarter. Analysts have already been lowering price targets of VRTX because of the likely competition from PS-7977 pending approval. Vertex will enjoy a couple of years of dominating market share before the competing drug enters the market. Annual sales could hit $2 to $3 billion for Vertex. Merck on the other hand is playing second fiddle and is likely to never see blockbuster status with its Hepatitis C drug.

Gilead’s Biggest Acquisitions

Gilead has a long history of acquiring other drug companies as many large drug companies do. Highlights include:

1999 Nexstar Pharmaceuticals - Gained two drugs through the acquisition. One, Ambisome, is still a marketed drug by Gilead. Deal seemed to be made more for the company’s intent on expanding in Europe.

2003 Triangle Pharmaceuticals - Emtriva, now a part of two Gilead drugs, was gained through this $464 million acquisition. Atripla and Truvada both use the component emtricitabine, a former Triangle product.

2006 Corrus Pharma - Has a current drug in Gilead’s pipeline aimed at treating Cystic Fibrosis.

2006 Myogen - Myogen was the most expensive acquisition previous to Pharmasset coming in at $2.5 billion. This has also been one of the most important and successful acquisitions made by Gilead as it brought three drugs, two marketed, and one currently sold by Gilead to the company.

2009 CV Therapeutics - Billion dollar purchase helped strengthen and diversify Gilead’s pool of drugs as it gained two drugs aimed at cardiovascular diseases.

Several other million dollar deals were made by Gilead over the last eight years. Gilead has made many of its acquisitions to strengthen its own technology and combine existing drugs with new ones.

Gilead’s Products

Gilead remains the market leader in drugs that treat the HIV virus. Its marketed products in the HIV market are:

Atripla is marketed with Bristol Myers Squibb (BMY) after its approval in 2006. The drug treats HIV and will lose patent expiration in 2021.

Complera is one of Gilead’s newest drugs on the market. It was approved by the FDA in August of 2011, and is co-marketed with Johnson and Johnson (JNJ).

Emtriva was approved in 2003 and will expire in 2021.

Truvada treats HIV and is one of Gilead’s top selling drugs. It was approved in 2004 and will lose its patent protection in 2021.

Viread treats Hepatitis B and HIV viruses. The drug was the first successfully launched HIV drug in 2001 by Gilead. The drug, which is a huge seller for Gilead, will lose patent protection in 2017.

Gilead has drugs in several other fields that compete with numerous other large drug companies. The other drugs currently on the market are:

Ambisome treats infections like fungal, meningitis, and Cryptococcus. The drug was approved in 1997 and will lose patent protection in 2016. The marketing partner on the drug is Astellas Pharma.

Cayston is Gilead’s cystic fibrosis drug that was approved in 2010. The drug has exclusive patent protection until 2021. Gilead markets the drug on its own and maintains all revenue from the drug.

Hepsera treats Hepatitis B and is owned and marketed by Gilead. The drug was approved in 2002 and its patent expires in 2014.

Letairis has since 2007 treated Pulmonary Hypertension. The drug is co-marketed with GlasxoSmithKline (GSK) and loses patent protection in 2015.

Lexiscan is a cardiovascular drug marketed with Astellas Pharma and it will lose patent protection in 2019.

Macugen is an age-related macular degeneration drug first approved in 2004, which is shared with Pfizer (PFE) and will lose patent protection in 2017.

Ranexa treats chest pain and will lose patent protection in 2019. The drug is co-marketed with Swiss drug company Roche.

Tamiflu treats the influenza virus as an oral capsule. The drug, which loses its patent protection in 2016, is licensed to Roche.

Vistide treats Cytomegalovirus and also certain eye problems involving the retina. The drug was founded in 1996 and has since lost its patent protection.

Gilead’s Pipeline

Gilead has twenty drugs listed on its site in current phases of trial. The drugs target HIV, Hepatitis C, numerous Cardiovascular diseases, Diabetes, Leukemia, Non-Hodgkin’s Lymphoma, and other diseases. Like many other large drug companies, Gilead has kept a strong pipeline targeting some of the biggest diseases affecting the world today. Three drugs targeting HIV are in Phase III trials currently. The Pharmasset acquisition will improve the company’s pipeline as it focuses on becoming a large player in the Hepatitis C market. Gilead will likely test several of its own Hepatitis drugs with Pharmasset products to create dual drugs much like it has with its HIV drugs.

The most important drug for Gilead in my opinion is known as the Quad. The drug combines Gilead’s own products and will help cut part of its revenue share with other marketing partners. The drug has held up well in trials. The drug will be brought in front of the FDA in 2012 and could be a substantial revenue earner for Gilead. The Quad drug is cutting down on symptoms from Gilead’s Atripla including dizziness, insomnia and depression. There are two trials testing Gilead drugs together in the Quad trials. Atripla had sales of $2.9 billion over the last year. However a portion of that revenue is given to Bristol Myers Squibb for its contribution to the drug. The approval of the quad pill could provide a nice bump to the share price in 2012.

Gilead’s Current Sales

Gilead is the leader in the HIV drug market and has shown its dominance. From the slide show presentation after the Pharmasset announcement it listed trailing twelve month revenue at $7.4 billion. The total market for HIV drugs is currently $13 billion so Gilead controls 50% of this blockbuster medical category. In the last fiscal year Gilead had earnings per share of $3.32 based on earnings of $2.9 billion.

Analysts call for earnings of $4.37 for the next fiscal year. With a closing share price of $39.28 on Friday, the price-to-earnings ratio is less than nine. According to Yahoo Finance, over 91% of the shares are currently held by institutions and mutual funds. More than 900 funds hold shares of Gilead as it represents one of the best plays on the healthcare and drugs industry.

Analyst Upgrades

Several days after the acquisition of Pharmasset was announced, analysts have upgraded shares. Citigroup and Bank of America both upgraded the shares after revaluating. Bank of America said that the company’s Hepatitis C program could some day be worth $15 to $30 billion. Gilead currently has a market capitalization of just under $30 billion so this deal could clearly define the company for the future.

My Share Valuation

I think the buyout of Pharmasset is a great purchase for Gilead. Gilead has made great use of drugs acquired through pipelines of companies it has bought out. Gilead absolutely owns the HIV drug market and the deal should help insure it gets a large portion of the Hepatitis C drug market in the future as well. For the coming year shares should trade closer to 12 times earnings, which would represent a share price of $52.44. The approval of the Quad drug as well as earnings announcements could power shares past $60. I think long term the company could double its market capitalization to $60 billion with its marketed HIV drugs and several Hepatitis C drugs on the market. I think shares would be a great purchase for an IRA as a bet on the company for the future.

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in GILD over the next 72 hours.

DAA market whispers...

My affinity for robust data is only usurped somewhat by my affinity for market trends. Although my sample size is incredibly small and my methods are unscientific and most likely engulfed in torrents of biases, there are a few things that seem to be happening in the DAA market that I'd like to present to you all for input. Depending on the response, I'll propose more.

1. Interferon may be going the way of the dinosaur for treatment of HCV, but ribavirin is here to stay. At least for the foreseeable future.

2. New Rx's for the DAAs have leveled off and may continue grow slower than anticipated. Victrelis may gain share against Incivek, also conversely to 'expert' forecast.

Feel free to share your thoughts.

Merck releases 24 week Boceprevir interim Phase IIb data in HIV/HCV co-infected patients...

Twenty-four week interim Phase IIb results looking a Boceprevir + PR in HIV/HCV co-infected patients. Results at week 24 show 70.5% (n=43/61) of patients receiving bocepreivr + PR were undetectable compared to 34.4%(n=11/32) of patients receiving just PR alone. This represented a treatment difference of 36.1%, according to the press release. Not much is said about the HIV regimen patients were on, other than it didn't include AZT or any of the 'D' drugs. Because boceprevir is a strong inhibitor of CYP3A4/5 and is partly metabolized by CYP3A4/5, drug-drug interactions with HIV antivirals are a real possibility. Merck also announced a trial in co-infected subjects who had failed previous therapy in conjunction with the French National Agency for Research on AIDS and Viral Hepatitis (ANRS) as well as a Phase III coinfection study in collaboration tithe the AIDS Clinical Trials Group (ACTG).

Interim Phase IIb Data for Merck's VICTRELIS(TM) (boceprevir) in Patients Coinfected with Chronic Hepatitis C and HIV-1 Presented at the Infectious Diseases Society of America (IDSA) 2011 Annual Meeting

BOSTON, Oct 20, 2011 (BUSINESS WIRE) -- Merck, known as MSD outside of the United States and Canada, today announced results from a 24-week interim analysis of an ongoing 48-week Phase IIb clinical study evaluating the investigational use of VICTRELIS(TM) (boceprevir), the company's first-in-class, oral hepatitis C virus (HCV) NS3/4A protease inhibitor, in combination with peginterferon alfa and ribavirin for the treatment of chronic HCV genotype 1 infection in adult patients coinfected with HIV-1. All patients in the study were new to treatment for chronic HCV, on an optimized antiretroviral regimen and had stable HIV-1 disease. The interim analysis showed that at week 24 of treatment, 70.5 percent (n=43/61) of patients receiving VICTRELIS in combination with peginterferon alfa-2b and ribavirin had undetectable hepatitis C virus (HCV-RNA) compared to 34.4 percent (n=11/32) of patients receiving peginterferon alfa-2b and ribavirin alone, a treatment difference of 36.1 percent. These interim results are being presented for the first time in a late-breaker oral presentation at the Infectious Diseases Society of America (IDSA) 2011 annual meeting in Boston. Final results from the study are expected in 2012.

"We are encouraged by these interim results with VICTRELIS in combination therapy in this difficult-to-treat patient population," said Roger J. Pomerantz, M.D., F.A.C.P., senior vice president, Infectious Diseases, Merck Research Laboratories. "Helping patients who are dealing with both chronic hepatitis C and HIV-1 is a critical issue in infectious diseases today, and Merck is committed to evaluating VICTRELIS in these patients. In addition to this ongoing Phase IIb study in patients new to HCV treatment, we are collaborating with the French National Agency for Research on AIDS and Viral Hepatitis (ANRS) on an ongoing Phase II study in patients who failed previous HCV treatment. We also plan to begin a Phase III coinfection study for VICTRELIS in combination therapy later this year in collaboration with the AIDS Clinical Trials Group (ACTG), which is funded by the U.S. National Institute of Allergy and Infectious Diseases."

Indications and usage for VICTRELIS

VICTRELIS was approved by the U.S. Food and Drug Administration (FDA) on May 13 for the treatment of chronic hepatitis C genotype 1 infection, in combination with peginterferon alfa and ribavirin, in adult patients (18 years of age and older) with compensated liver disease, including cirrhosis, who are previously untreated or who have failed previous interferon and ribavirin therapy.

The following points should be considered when initiating VICTRELIS for treatment of chronic hepatitis C infection:

-- VICTRELIS must not be used as monotherapy and should only be used in combination with peginterferon alfa and ribavirin.

-- VICTRELIS efficacy has not been studied in patients who have previously failed therapy with a treatment regimen that includes VICTRELIS or other HCV NS3/4A protease inhibitors. VICTRELIS in combination with peginterferon alfa and ribavirin has not been studied in patients documented to be historical null responders (less than a 2 log HCV-RNA decline by treatment week 12) during prior therapy with peginterferon alfa and ribavirin. The clinical studies included patients who were poorly interferon responsive. Patients with less than 0.5 log HCV-RNA decline in viral load at treatment week 4 with peginterferon alfa plus ribavirin alone are predicted to have a null response (less than a 2 log HCV-RNA decline by treatment week 12) to peginterferon alfa and ribavirin therapy.

-- Poorly interferon responsive patients who were treated with VICTRELIS in combination with peginterferon alfa and ribavirin have a lower likelihood of achieving a sustained virologic response (SVR), and a higher rate of detection of resistance-associated substitutions upon treatment failure, compared to patients with a greater response to peginterferon alfa and ribavirin.

Key interim results

One hundred (100) adult patients with previously untreated HCV genotype 1 infection and stable HIV-1 disease (HIV-RNA less than 50 copies/mL; CD4 cell counts equal to or greater than 200 cells/mm(3)) were randomized into the study. Two patients randomized to the treatment arm receiving VICTRELIS in combination with peginterferon alfa-2b (P) and ribavirin (R) did not receive VICTRELIS. Thus, the interim analysis was based on 98 patients who received at least one dose of study drug: 64 patients in the arm receiving VICTRELIS plus P/R, and 34 patients in the control arm receiving P/R alone. All patients treated in the study received a 4-week lead-in with P/R alone followed by VICTRELIS plus P/R or placebo plus P/R for 44 weeks, for a total treatment duration of 48 weeks.

Preliminary safety data for VICTRELIS in combination therapy in HCV/HIV coinfected patients demonstrated a profile similar to that previously observed in patients with HCV mono-infection. There were no unexpected trends in HIV-RNA levels or CD4 cell counts.

The most common clinical adverse events with a difference of equal to or greater than 10 percent for the treatment arm receiving VICTRELIS plus P/R compared to the P/R control arm, respectively, were: neutropenia (13 vs. 3 percent), dysgeusia (bad taste) (25 vs. 15 percent), vomiting (25 vs. 15 percent), pyrexia (34 vs. 21 percent), headache (28 vs. 12 percent) and decreased appetite (30 vs. 18 percent) [median days on study, 211 vs. 166, respectively]. Serious clinical adverse events occurred in 8 percent and 21 percent of patients in the two treatment arms, respectively. Dose modification for any study drug due to a clinical adverse event occurred in 19 percent and 21 percent of patients, respectively, and study discontinuation due to a clinical adverse event occurred in 14 percent and 9 percent of patients, respectively.

About the Phase IIb coinfection study

The primary objective of this ongoing randomized, multicenter, double-blinded for VICTRELIS, Phase IIb study is to compare the efficacy of VICTRELIS 800 mg three times daily in combination with peginterferon alfa-2b (P) 1.5 mcg/kg weekly plus ribavirin (R) 600 to 1,400 mg daily to therapy with P/R alone in adult patients coinfected with chronic HCV genotype 1 and HIV-1. Patients were randomized in a 2:1 ratio to the treatment arm with VICTRELIS plus P/R or the P/R control arm, respectively. Patients were stratified by cirrhosis (yes/no) and baseline HCV-RNA (less than 800,000 IU/mL vs. equal to or greater than 800,000 IU/mL). The majority of patients were non-cirrhotic (95 percent), white (82 percent) and male (69 percent), with a median age of about 43 years. Most patients had high HCV-RNA (88 percent) at baseline and HCV genotype 1a infection (65 percent).

Antiretroviral regimens for HIV-1 that included non-nucleoside reverse transcriptase inhibitors (NNRTIs), zidovudine, stavudine or didanosine were not permitted. Patients with detectable HCV-RNA and less than a 2 log HCV-RNA decline at treatment week 12 or detectable HCV-RNA at treatment week 24 were considered treatment failures and discontinued all treatment.

Important safety information about VICTRELIS

All contraindications to peginterferon alfa and ribavirin also apply since VICTRELIS must be administered with peginterferon alfa and ribavirin. Because ribavirin may cause birth defects and fetal death, VICTRELIS in combination with peginterferon alfa and ribavirin is contraindicated in pregnant women and in men whose female partners are pregnant. Avoid pregnancy in female patients and female partners of male patients. Patients must have a negative pregnancy test prior to therapy; have monthly pregnancy tests; and use two or more forms of effective contraception, including intrauterine devices and barrier methods, during treatment and for at least 6 months after treatment has concluded. Systemic hormonal contraceptives may not be as effective in women while taking VICTRELIS.

VICTRELIS is contraindicated in coadministration with drugs that are highly dependent on CYP3A4/5 for clearance, and for which elevated plasma concentrations are associated with serious and/or life-threatening events. VICTRELIS also is contraindicated in coadministration with potent CYP3A4/5 inducers where significantly reduced boceprevir plasma concentrations may be associated with reduced efficacy. Drugs that are contraindicated with VICTRELIS include: alfuzosin, carbamazepine, phenobarbital, phenytoin, rifampin, dihydroergotamine, ergonovine, ergotamine, methylergonovine, cisapride, St. John's Wort (hypericum perforatum), lovastatin, simvastatin, drosperinone, Revatio(R) (sildenafil) or Adcirca(R) (tadalafil) (when used for the treatment of pulmonary arterial hypertension), pimozide, triazolam, and midazolam (orally administered).

Anemia has been reported with peginterferon alfa and ribavirin therapy. The addition of VICTRELIS to peginterferon alfa and ribavirin is associated with an additional decrease in hemoglobin concentrations. The addition of VICTRELIS may result in a worsening of neutropenia associated with peginterferon alfa and ribavirin alone. Complete blood count (with white blood cell differential counts) must be conducted in all patients prior to initiating VICTRELIS combination therapy. Complete blood counts should be obtained pretreatment, and at treatment weeks 4, 8 and 12, and should be monitored closely at other time points, as clinically appropriate. If a patient has a serious adverse reaction potentially related to peginterferon alfa and ribavirin therapy, the peginterferon alfa and/or ribavirin dose should be reduced or discontinued. VICTRELIS must not be administered in the absence of peginterferon alfa and ribavirin. Dose reduction of VICTRELIS is not recommended.

The most commonly reported adverse reactions (greater than 35 percent) in clinical trials in adult patients receiving the combination of VICTRELIS with peginterferon alfa-2b and ribavirin were fatigue, anemia, nausea, headache and dysgeusia. Of these commonly reported adverse reactions, fatigue, anemia, nausea, and dysgeusia occurred at rates greater than or equal to 5 percent above the rates for peginterferon alfa and ribavirin alone in either clinical study. The incidence of these adverse reactions in previously untreated patients who received VICTRELIS combination therapy compared with peginterferon and ribavirin alone were: fatigue (58 vs. 59 percent), anemia (50 vs. 30 percent), nausea (46 vs. 42 percent), dysgeusia (35 vs. 16 percent), respectively. The incidence of these adverse reactions in previously treated patients who received VICTRELIS combination therapy compared with peginterferon and ribavirin alone were: fatigue (55 vs. 50 percent), anemia (45 vs. 20 percent), nausea (43 vs. 38 percent), dysgeusia (44 vs. 11 percent), respectively.

VICTRELIS is a strong inhibitor of CYP3A4/5 and is partly metabolized by CYP3A4/5. The potential for drug-drug interactions must be considered prior to and during therapy.

Please see U.S. prescribing information at: http://www.merck.com/product/usa/pi_circulars/v/victrelis/victrelis_pi.pdf .

Merck's global commitment to advancing hepatitis therapy

Merck is committed to building on its strong legacy in the field of viral hepatitis by continuing to discover, develop and deliver vaccines and medicines to help prevent and treat viral hepatitis. In hepatitis C, company researchers developed the first approved therapy for chronic HCV in 1991 and the first combination therapy in 1998. In addition to ongoing studies with VICTRELIS, extensive research efforts are underway to develop additional innovative oral therapies for viral hepatitis treatment.

About Merck

Today's Merck is a global healthcare leader working to help the world be well. Merck is known as MSD outside the United States and Canada. Through our prescription medicines, vaccines, biologic therapies, and consumer care and animal health products, we work with customers and operate in more than 140 countries to deliver innovative health solutions. We also demonstrate our commitment to increasing access to healthcare through far-reaching policies, programs and partnerships. For more information, visit www.merck.com and connect with us on Twitter, Facebook and YouTube.

Forward-Looking Statement

This news release includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, statements about the benefits of the merger between Merck and Schering-Plough, including future financial and operating results, the combined company's plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Merck's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the possibility that the expected synergies from the merger of Merck and Schering-Plough will not be realized, or will not be realized within the expected time period; the impact of pharmaceutical industry regulation and health care legislation; the risk that the businesses will not be integrated successfully; disruption from the merger making it more difficult to maintain business and operational relationships; Merck's ability to accurately predict future market conditions; dependence on the effectiveness of Merck's patents and other protections for innovative products; the risk of new and changing regulation and health policies in the U.S. and internationally and the exposure to litigation and/or regulatory actions.

Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in Merck's 2010 Annual Report on Form 10-K and the company's other filings with the Securities and Exchange Commission (SEC) available at the SEC's Internet site ( www.sec.gov ).

Please see Prescribing Information for VICTRELIS at http://www.merck.com/product/usa/pi_circulars/v/victrelis/victrelis_pi.pdf and Medication Guide for VICTRELIS at http://www.merck.com/product/usa/pi_circulars/v/victrelis/victrelis_mg.pdf .

SOURCE: Merck


Merck
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Forbes article - "The Hepatitis C Wars: What Docs Say About The Newest Meds"

(Forbes article by Ed Silverman on the 'DAA Wars' and how HCV providers view Invicek vs Victrelis. Interesting insight, but the most compelling aspect to this is whether the reconfigured Rx data from IMS for the last two weeks of September will confirm a stall in the growth of both products)

The Hepatitis C Wars: What Docs Say About The Newest Meds

By Ed Silverman

Over the past several days, there has been a great deal of confusion about the extent to which physicians are embracing the new Incivek hepatitis C drug that is sold by Vertex Pharmaceuticals. The reason is that IMS Health, the market research firm that tracks prescriptions, has to restate mail-order activity for the drug for the last two weeks of September.

The uncertainty sent Vertex stock gyrating because the initial data suggested prescriptions had stopped growing. Investors are now waiting for IMS to release an update. Meanwhile, we thought it might be interesting to provide a different sort of look at how Incivek is faring along with its equally new rival, Victrelis, which is sold by Merck and Roche.

A survey conducted in August of 80 physicians – 29 gastroenterologists, 25 hepatologists, and 26 infectious disease specialists – finds that Incivek is edging out Victrelis in various ways, according to Decision Resources, which queried the doctors. The latest survey, by the way, was run three months after the meds launched and updates an earlier effort that was conducted one month after launch.

The survey found that a widening gap in physician satisfaction between the two treatments. One month after launch, 36 percent of the docs were satisfied with Victrelis and this rose to 48 percent after three months. Among those physicians prescribing Incivek, 40 percent were satisfied one month after product launch and this jumped to 55 percent after the three-month mark.

Interestingly, the average number of patients being treated was slightly lower three months after launch, although the percent of docs using both meds increased significantly. Both drugs have high recognition – 36 percent of the docs were able to cite either the brand or generic name for Victrelis; the figure was 34 percent for Incivek. And two-thirds reported receiving patient requests for the drugs.

Meanwhile, more than two thirds of the docs have begun using either med, compared with more than one half of physicians at one month after the launches. However, Decision Resources notes that most docs have prescribed both brands, suggesting they are still experimenting. So far, 29 percent say it it too soon to know whether they are satisfied with Incivek; the number was 27 percent for Victrelis.

Another nugget: most Americans with hepatitis C have genotype 1, which is the hardest to treat. The survey found that infectious disease specialists have more genotype 1 patients undergoing active treatment compared to two months earlier; Victrelis share among hepatologists is higher compared to gastroenterologists; and gastroenterologists view shorter duration of treatment and managed care access as significantly more important when choosing a drug compared to the other specialties.

Overall, the main benefit of this new class of hepatitis C treatments is the improvement in sustained viral load or SVR, according to the docs surveyed. While Incivek beat Victrelis on higher SVR, shorter duration and simpler protocol, the perception of superior efficacy was countered by concerns with rash, according to Decision Resources. “While it’s too soon to tell, Victrelis may fill a niche for patients who prefer it’s side effect profile,” the firm reports.

BioTrends Research Group report on provider perceptions and use of Incivek and Victrelis...

New research from BioTrends Research Group on HCV provider perceptions and use of both Incivek and Victrelis. Consistent with my perceptions in the field, there is a wide gap between use of Incivek vs Victrelis, with Incivek taking a large lead. Not mentioned in this report is an emerging trend of some providers starting a second wave of 'warehousing' for the second generation of HCV Direct Acting Antivirals (DAAs), mostly for patients that are F0-F1 and are null responders to previous Peg + P/R therapy or genotype 2/3 nonresponders.

PRESS RELEASE
Oct. 6, 2011, 3:12 p.m. EDT
Hepatitis C Landscape is Changing as the New Protease Inhibitors are Adopted into Clinical Practice

Vertex's Incivek is outperforming Merck/Roche's Victrelis on many of the most important attributes and differences between physician specialties are beginning to emerge according to a new report by BioTrends Research Group


EXTON, Pa., Oct 06, 2011 (BUSINESS WIRE) -- Three months after the launch of Vertex's Incivek (telaprevir) and Merck/Roche's Victrelis (boceprevir), results from the second wave of research conducted by BioTrends Research Group indicate strong interest and high demand for triple therapy with the new protease inhibitors.

In LaunchTrends(R): Incivek and Victrelis, Wave 2 BioTrends surveyed a total of 80 physicians (gastroenterologists, hepatologists, and infectious disease specialists) and conducted in-depth qualitative interviews with a subset of the respondents about their current perceptions, early experience and anticipated future use of these products. In addition, feedback around patient type, product satisfaction, patient influence, obstacles to use, and promotional activities is captured.

With expectations running high in the months leading up to the launch of the protease inhibitors, the level of awareness and familiarity with these products remains strong. Now more than two thirds of surveyed physicians have initiated trial with Incivek or Victrelis compared to more than one half of physicians at one month post-launch. Most physicians report that they have prescribed both brands suggesting that physicians continue to be in trial mode. Trial rates do vary by physician specialty and in addition, after three months of experience, specialty differences in preference and usage are now emerging.

The majority of surveyed physicians report seeing either a Victrelis or Incivek representative. Representatives for both products were given strong performance ratings on their overall disease state and product knowledge. There were slight variations in messages being delivered with counter-detailing largely centered on the side effect profile of the competitor drug.

Physicians report a high number of eligible patients yet to be started on the new protease inhibitors. Both newly diagnosed patients as well as patients who had either failed prior treatment or who were untreated and awaiting the approval of Incivek and Victrelis are fueling patient starts. Although the protease inhibitors are only indicated for genotype 1 patients, approximately one-third of the respondents report that they would consider these agents for genotype 2/3 patients as well. While both products have increased market share by about 50 percent at three months compared to one month post launch, the gap between the products has widened with Incivek continuing to take the lead. Market share projections in the next six months suggest that Incivek will retain a significant share advantage although the surveyed physicians indicate that the projected gap will narrow.

With the recent European approval of telaprevir under the brand name INCIVO(R), preceded by the approval of boceprevir (VICTRELIS(TM)) in July, the protease inhibitors are poised to address a significant unmet global need for better treatments for genotype 1 chronic-HCV. The impact of the products in the EU countries will be closely monitored and reported on in a Treatment Trends HCV (EU) to be published in 2012.

About LaunchTrends

LaunchTrends(R): Incivek and Victrelis is a series of three post-launch syndicated reports designed to track the uptake of Merck's Victrelis and Vertex's Incivek at one month, three months and six months following launch. LaunchTrends(R) assesses trial and use of new products, barriers to use, reasons to use, typical patient types, line of therapy, product perceptions, promotional efforts/messages and product satisfaction.

About BioTrends Research Group, LLC

BioTrends Research Group, LLC provides syndicated and custom market research to pharmaceutical manufacturers competing in clinically evolving, specialty pharmaceutical markets. For information on BioTrends publications and research capabilities, please contact us at (610) 363-3872 or www.bio-trends.com .

About Decision Resources Group

Decision Resources Group is a cohesive portfolio of companies that offers best-in-class, high-value information and insights on important sectors of the healthcare industry. Clients rely on this analysis and data to make informed decisions. Please visit Decision Resources Group at www.DecisionResourcesGroup.com .

All company, brand, or product names contained in this document may be trademarks of their respective holders.

SOURCE: BioTrends Research Group, LLC

Merck announces presentations and posters for upcoming AASLD meeting....

Merck Announces New Data Analyses For VICTRELIS™ (Boceprevir) Will Be Presented At The American Association For The Study Of Liver Diseases 2011 Annual Meeting

Written by TradersHuddle Staff

Friday, 30 September 2011 10:58

WHITEHOUSE STATION, N.J.-( Business Wire )-
Merck (NYSE: MRK), known as MSD outside of the United States and Canada, announced today that several new analyses from Phase III studies of VICTRELIS™ (boceprevir), the company’s first-in-class, oral hepatitis C virus (HCV) NS3/4A protease inhibitor will be presented at the 62nd Annual Meeting of the American Association for the Study of Liver Diseases (AASLD). The meeting will be held Nov. 4-8 in San Francisco. Presentations will include results from the Phase III PROVIDE study, which evaluated the efficacy of VICTRELIS in combination with peginterferon alfa and ribavirin in adult patients with chronic HCV genotype 1 infection who had prior null response to treatment with peginterferon alfa and ribavirin alone.

More than 30 abstracts highlighting Merck medicines and investigational therapies for chronic HCV will be presented at AASLD, including four oral presentations and 14 posters for VICTRELIS. One poster has been selected as a Presidential Poster of Distinction.

New data also will be presented on the efficacy and safety of Merck's MK-5172, an investigational once-daily, second-generation oral HCV NS3/4A protease inhibitor, in patients chronically infected with HCV genotypes 1 and 3.

"Merck looks forward to sharing data with the scientific community at this year's AASLD to inform the continuing fight against chronic hepatitis C," said Roger J. Pomerantz, M.D., F.A.C.P., senior vice president, Infectious Diseases, Merck Research Laboratories.

The abstracts were published today and can be accessed on the AASLD website. For program information, please visit https://www.aasld.org.

Key presentations for VICTRELIS

Efficacy of Boceprevir in Patients with Null Responses to Peginterferon/Ribavirin:

The PROVIDE study. Vierling, J. et al. Poster 931. Sunday, Nov. 6, 8:00 a.m. – 5:30 p.m. Moscone West Convention Center Poster Hall

Treatment-Naive Black Patients Treated with Boceprevir Combined with Peginterferon Alfa-2b + Ribavirin: Results from HCV SPRINT-2. McCone, J. et al. Poster 981. Sunday, Nov. 6, 8:00 a.m. – 5:30 p.m.

Analysis of Resistance-Associated Amino Acid Variants (RAVs) in non-SVR Patients Enrolled in a Retrospective Long-Term Follow-Up Analysis of Boceprevir Phase III Clinical Studies. Barnard, R.J.O. et al. Abstract #164. Oral Presentation: Monday, Nov. 7, 3:15 - 3:30p.m., Moscone West Convention Center, Rooms 2001-2003 and 2014-2016

Genotypic and Phenotypic Correlates of Resistance in HCV Genotype 1a and 1b Infected Patients Treated with Boceprevir Plus Peginterferon Alpha and Ribavirin. Ogert, R.A. et al. Poster 927. Sunday, Nov. 6, 8:00 a.m. – 5:30 p.m. Moscone West Convention Center Poster Hall. Selected as a Presidential Poster of Distinction

Other key Merck presentations

IL28B genotype predicted for >/=1 log10 IU/mL reduction in serum HCV RNA after 4 weeks of peginterferon and ribavirin therapy: implications for the use of the lead-in strategy for DAA-based treatment regimens. Thompson, A.J. et al. Abstract #157. Oral Presentation: Monday, Nov. 7, 3:00 -3:15 p.m., Moscone West Convention Center, Rooms 2006-2008

Safety and Antiviral Activity of MK-5172, a Next Generation HCV NS3/4A Protease Inhibitor with a Broad HCV Genotypic Activity Spectrum and Potent Activity Against Known Resistance Mutants, in Genotype 1 and 3 HCV-Infected Patients. Petry, A. et al. Poster 346. Saturday, Nov. 5, 2:00 p.m. – 7:30 p.m. Moscone West Convention Center Poster Hall

MK-5172, a Second-Generation HCV NS3/4A Protease Inhibitor, is Active against Common Resistance Associated Variants (RAVs) and Exhibits Cross-Genotype Activity. Graham, D. et al. Poster 370. Saturday, Nov. 5, 2:00 p.m. – 7:30 p.m. Moscone West Convention Center Poster Hall

Indications and usage for VICTRELIS

VICTRELIS was approved by the U.S. Food and Drug Administration (FDA) on May 13 for the treatment of chronic hepatitis C genotype 1 infection, in combination with peginterferon alfa and ribavirin, in adult patients (18 years of age and older) with compensated liver disease, including cirrhosis, who are previously untreated or who have failed previous interferon and ribavirin therapy.

The following points should be considered when initiating VICTRELIS for treatment of chronic hepatitis C infection:

VICTRELIS must not be used as monotherapy and should only be used in combination with peginterferon alfa and ribavirin.
VICTRELIS efficacy has not been studied in patients who have previously failed therapy with a treatment regimen that includes VICTRELIS or other HCV NS3/4A protease inhibitors. VICTRELIS in combination with peginterferon alfa and ribavirin has not been studied in patients documented to be historical null responders (less than a 2 log HCV-RNA decline by treatment week 12) during prior therapy with peginterferon alfa and ribavirin. The clinical studies included patients who were poorly interferon responsive. Patients with less than 0.5 log HCV-RNA decline in viral load at treatment week 4 with peginterferon alfa plus ribavirin alone are predicted to have a null response (less than a 2 log HCV-RNA decline by treatment week 12) to peginterferon alfa and ribavirin therapy.
Poorly interferon responsive patients who were treated with VICTRELIS in combination with peginterferon alfa and ribavirin have a lower likelihood of achieving a sustained virologic response (SVR), and a higher rate of detection of resistance-associated substitutions upon treatment failure, compared to patients with a greater response to peginterferon alfa and ribavirin.
Important safety information about VICTRELIS

All contraindications to peginterferon alfa and ribavirin also apply since VICTRELIS must be administered with peginterferon alfa and ribavirin. Because ribavirin may cause birth defects and fetal death, VICTRELIS in combination with peginterferon alfa and ribavirin is contraindicated in pregnant women and in men whose female partners are pregnant. Avoid pregnancy in female patients and female partners of male patients. Patients must have a negative pregnancy test prior to therapy; have monthly pregnancy tests; and use two or more forms of effective contraception, including intrauterine devices and barrier methods, during treatment and for at least 6 months after treatment has concluded. Systemic hormonal contraceptives may not be as effective in women while taking VICTRELIS.

VICTRELIS is contraindicated in coadministration with drugs that are highly dependent on CYP3A4/5 for clearance, and for which elevated plasma concentrations are associated with serious and/or life-threatening events. VICTRELIS also is contraindicated in coadministration with potent CYP3A4/5 inducers where significantly reduced boceprevir plasma concentrations may be associated with reduced efficacy. Drugs that are contraindicated with VICTRELIS include: alfuzosin, carbamazepine, phenobarbital, phenytoin, rifampin, dihydroergotamine, ergonovine, ergotamine, methylergonovine, cisapride, St. John's Wort (hypericum perforatum), lovastatin, simvastatin, drosperinone, Revatio® (sildenafil) or Adcirca® (tadalafil) (when used for the treatment of pulmonary arterial hypertension), pimozide, triazolam, and midazolam (orally administered).

Anemia has been reported with peginterferon alfa and ribavirin therapy. The addition of VICTRELIS to peginterferon alfa and ribavirin is associated with an additional decrease in hemoglobin concentrations. The addition of VICTRELIS may result in a worsening of neutropenia associated with peginterferon alfa and ribavirin alone. Complete blood counts should be obtained pretreatment, and at treatment weeks 4, 8 and 12, and should be monitored closely at other time points, as clinically appropriate. If a patient has a serious adverse reaction potentially related to peginterferon alfa and ribavirin therapy, the peginterferon alfa and/or ribavirin dose should be reduced or discontinued. VICTRELIS must not be administered in the absence of peginterferon alfa and ribavirin. Dose reduction of VICTRELIS is not recommended.

The most commonly reported adverse reactions (greater than 35 percent) in clinical trials in adult patients receiving the combination of VICTRELIS with peginterferon alfa-2b and ribavirin were fatigue, anemia, nausea, headache and dysgeusia. Of these commonly reported adverse reactions, fatigue, anemia, nausea, and dysgeusia occurred at rates greater than or equal to 5 percent above the rates for peginterferon alfa and ribavirin alone in either clinical study. The incidence of these adverse reactions in previously untreated patients who received VICTRELIS combination therapy compared with peginterferon and ribavirin alone were: fatigue (58 vs. 59 percent), anemia (50 vs. 30 percent), nausea (46 vs. 42 percent), dysgeusia (35 vs. 16 percent), respectively. The incidence of these adverse reactions in previously treated patients who received VICTRELIS combination therapy compared with peginterferon and ribavirin alone were: fatigue (55 vs. 50 percent), anemia (45 vs. 20 percent), nausea (43 vs. 38 percent), dysgeusia (44 vs. 11 percent), respectively.

VICTRELIS is a strong inhibitor of CYP3A4/5 and is partly metabolized by CYP3A4/5. The potential for drug-drug interactions must be considered prior to and during therapy.

Please see U.S. prescribing information at: http://www.merck.com/product/usa/pi_circulars/v/victrelis/victrelis_pi.pdf.

Merck's global commitment to advancing hepatitis therapy

Merck is committed to building on its strong legacy in the field of viral hepatitis by continuing to discover, develop and deliver vaccines and medicines to help prevent and treat viral hepatitis. In hepatitis C, company researchers developed the first approved therapy for chronic HCV in 1991 and the first combination therapy in 1998. In addition to ongoing studies with VICTRELIS, extensive research efforts are underway to develop additional innovative oral therapies for viral hepatitis treatment.

About Merck

Today's Merck is a global healthcare leader working to help the world be well. Merck is known as MSD outside the United States and Canada. Through our prescription medicines, vaccines, biologic therapies, and consumer care and animal health products, we work with customers and operate in more than 140 countries to deliver innovative health solutions. We also demonstrate our commitment to increasing access to healthcare through far-reaching policies, programs and partnerships. For more information, visit www.merck.com and connect with us on Twitter, Facebook and YouTube.

Forward-Looking Statement

This news release includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, statements about the benefits of the merger between Merck and Schering-Plough, including future financial and operating results, the combined company’s plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Merck’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the possibility that the expected synergies from the merger of Merck and Schering-Plough will not be realized, or will not be realized within the expected time period; the impact of pharmaceutical industry regulation and health care legislation; the risk that the businesses will not be integrated successfully; disruption from the merger making it more difficult to maintain business and operational relationships; Merck’s ability to accurately predict future market conditions; dependence on the effectiveness of Merck’s patents and other protections for innovative products; the risk of new and changing regulation and health policies in the U.S. and internationally and the exposure to litigation and/or regulatory actions.

Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in Merck’s 2010 Annual Report on Form 10-K and the company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site (www.sec.gov).

Please see Prescribing Information for VICTRELIS at http://www.merck.com/product/usa/pi_circulars/v/victrelis/victrelis_pi.pdf and Medication Guide for VICTRELIS at http://www.merck.com/product/usa/pi_circulars/v/victrelis/victrelis_mg.pdf.



Merck & Co., Inc.Media:Pamela Eisele, 908-423-5042orLainie Keller, 908-423-4187orInvestor:Carol Ferguson, 908-423-4465