Novartis restructures HCV licensing deal with Idenix...

Posted on 8/1/2012 on PharmaTimes.com. It seems like subtle change is afoot in the HCV drug development field. Gilead announced that it would co-formulate GS-5855 and GS-7977 into one pill with an expected launch date of 2014 and Vertex posted earnings well below expectations of Wall Street on lower-than-anticipated sales of Incivek. Now, Novartis announces it is restructuring it's licensing deal with Idenix, giving the latter company back it's development rights for it's HCV pipeline. We can only speculate on why the rights were handed back to Idenix, but I'm sure Gilead's bold announcement and the post-EASL dampening of the current marketplace and it's chilling effect on the life cycles of the first generation of anti-HCV drugs didn't offer any remedy for cold feet.


Idenix gets rights back to pipeline from Novartis
WORLD NEWS | AUGUST 01, 2012

KEVIN GROGAN

Idenix Pharmaceuticals has regained the rights to hepatitis C compounds that were partnered with Novartis and announced plans to raise $150 million.

The US firm and the Swiss major first teamed up in May 2003 when the latter purchased a 54% stake in Idenix and licensed the hepatitis B treatment Tyzeka/Sebivo (telbivudine). Under the original agreement, Novartis had the option to license any of Idenix' candidates after proof-of-concept, so long as it maintained at least a 30% stake.

Novartis currently has a 31% holding but the pact has now been restructured. The option to license Idenix's development-stage drug candidates in any therapeutic area has been terminated and Novartis will be entitled to royalties on future hepatitis C virus drugs.

Novartis will have a non-exclusive option to conduct trials evaluating a combination of any of its and Idenix' HCV drug candidates, and the latter firm will no longer receive royalty or milestone payments from Tyzeka/Sebivo sales. The Basel-headquartered group will retain the right to designate one member to Idenix's board, reduced from two, as long as it continues to own at least a 15% stake.

Ron Renaud, Idenix chief executive, said the new agreement gives the firm "increased flexibility to optimise the value of our pipeline". By regaining the worldwide rights to all its drug candidates, "we believe Idenix will be well-positioned to develop pan-genotypic all-oral direct-acting antiviral combination treatments with potential collaborators," he added.

As the restructured deal was being announced, Idenix noted that it has commenced an underwritten registered public offering of $150 million of its common stock.

The proceeds will be used to develop combination Phase IIb trials of its HCV drugs IDX184 and IDX719, and Phase IIa studies with IDX19368 in combination with ribavirin. The funds may also be used to "potential acquisitions of new businesses, technologies or products that Idenix believes complements or expands its business".

Achillion Pharmaceuticals names ex-Vertex CCO to it's board of directors...

Posted on 6-11-12 on MarketWatch.com. True HCV Drug Development nerds will recognize Kurt Grave's name from his tenure as Executive Vice President, Head of Corporate and Strategic Development and Chief Commercial Officer at Vertex Pharmaceuticals from 2007 to 2009 - no easy task to take a small, primarily R&D company and ready it for commercialization. His tenure abruptly ended at Vertex as he and then-CEO Matthew Emmens butted heads. Some of you might argue with me, but it seems like Vertex could use Grave's leadership skills given the company's current level of dysfunction and dissatisfaction with it's current leadership.  Mr. Graves replacing Nicholas Simon on the Achillion board could also be interpreted in multiple ways, following the leadership shakeup when CMO Elizabeth Olek resigned last week.

PRESS RELEASE
June 11, 2012, 4:03 p.m. EDT
Achillion Appoints Kurt Graves to Its Board of Directors

NEW HAVEN, Conn., Jun 11, 2012 (GlobeNewswire via COMTEX) -- Achillion Pharmaceuticals, Inc. ACHN +0.65% today announced the appointment of Kurt Graves to its board of directors as an independent director. Mr. Graves brings more than two decades of experience in building, leading and advising top-performing pharmaceutical and biotechnology companies. Mr. Graves was appointed as a Class I director, with a term expiring in 2013, and will replace Nicholas Simon of Clarus Ventures LLC.

"We are very pleased to have Kurt join the Board of Directors, as his extensive strategic knowledge of hepatitis C and successful career in transforming pharmaceutical companies complements the expertise of the entire Achillion Board," commented David I. Scheer, Chairman of the Board of Achillion. "From his tenures at Merck, Novartis and Vertex Pharmaceuticals, Kurt brings a depth of industry expertise and a global business view that will serve us well as we move toward achieving a number of aggressive milestones including the initiation of all-oral, interferon-free clinical trials evaluating regimens containing our pan-genotypic protease inhibitor, ACH-1625, and NS5A inhibitor, ACH-3102, for the treatment of HCV."

Michael Kishbauch, President and Chief Executive Officer of Achillion further commented, "On behalf of the Board of Directors, I would also like to thank Nick Simon for his insight and guidance over the past three and a half years as Achillion matured into a clinical-stage pharmaceutical company, with a portfolio of proprietary hepatitis C compounds discovered by Achillion and advanced into clinical development."

Mr. Graves currently serves as Chairman, President and Chief Executive Officer of Intarcia Therapeutics. He is also Chairman of the Board of Radius, since April 2011, and a Director of Pulmatrix and Springleaf Therapeutics, since May 2010. In addition to his global experience in large pharmaceutical companies, Mr. Graves has played key leadership roles in building two highly successful early stage companies; at Astra Merck Pharmaceuticals and Vertex Pharmaceuticals. Mr. Graves was EVP, Head of Corporate and Strategic Development and Chief Commercial Officer at Vertex Pharmaceuticals from 2007 through 2009. Prior to his tenure at Vertex, he spent nearly ten years at Novartis Pharmaceuticals in senior leadership positions of increasing responsibility, and was most recently Global Head of the General Medicines Business Unit & Chief Marketing Officer for the Pharmaceuticals division. Prior to Novartis, Mr. Graves held commercial and general management positions of increasing responsibility at Merck and Astra Merck Pharmaceuticals where he led the GI Business Unit, with responsibility for Prilosec and Nexium.

Mr. Graves earned his B.S. in Biology from Hillsdale College and has attended executive leadership programs at Harvard, Wharton School of Management and University of Michigan.

About HCV

The hepatitis C virus is the most common cause of viral hepatitis, which is an inflammation of the liver. It is currently estimated that more than 170 million people are infected with HCV worldwide including more than 5 million people in the United States, more than twice as widespread as HIV. Three-fourths of the HCV patient population is undiagnosed; it is a silent epidemic and a major global health threat. Chronic hepatitis, if left untreated, can lead to permanent liver damage that can result in the development of liver cancer, liver failure or death. Few therapeutic options currently exist for the treatment of HCV infection. The current standard of care is limited by its specificity for certain types of HCV, significant side-effect profile, and injectable route of administration.

About Achillion Pharmaceuticals

Achillion is an innovative pharmaceutical company dedicated to bringing important new treatments to patients with infectious disease. Achillion's proven discovery and development teams have advanced multiple product candidates with novel mechanisms of action. Achillion is focused on solutions for the most challenging problems in infectious disease including HCV and resistant bacterial infections. For more information on Achillion Pharmaceuticals, please visit www.achillion.com or call 1-203-624-7000.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks, uncertainties and other important factors that could cause actual results to differ materially from those indicated by such forward-looking statements, including statements with respect to the expected contributions of Mr. Graves to the Achillion Board of Directors and Achillion's expectations with respect to milestone achievement, and, in particular, its plans to initiate all-oral, interferon-free clinical trials evaluating regimens containing ACH-1625 and ACH-3102 for the treatment of HCV. Among the factors that could cause actual results to differ materially from those indicated by such forward-looking statements are risks relating to, among other things Achillion's ability to: replicate in later clinical trials positive results found in earlier stage nonclinical studies and clinical trials of ACH-2684, ACH-1625 and ACH-3102; advance the development of its drug candidates under the timelines it anticipates in current and future clinical trials; obtain necessary regulatory approvals; obtain patent protection for its drug candidates and the freedom to operate under third party intellectual property; establish commercial manufacturing arrangements; identify, enter into and maintain collaboration agreements with appropriate third-parties; compete successfully with other companies that are seeking to develop improved therapies for the treatment of HCV; manage expenses; and raise the substantial additional capital needed to achieve its business objectives. These and other risks are described in the reports filed by Achillion with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2011 and its subsequent SEC filings.

In addition, any forward-looking statement in this press release represents Achillion's views only as of the date of this press release and should not be relied upon as representing its views as of any subsequent date. Achillion disclaims any obligation to update any forward-looking statement, except as required by applicable law.

This news release was distributed by GlobeNewswire, www.globenewswire.com

SOURCE: Achillion Pharmaceuticals, Inc.



        CONTACT: Company Contact:
        Glenn Schulman
        Achillion Pharmaceuticals, Inc.
        Tel. (203) 624-7000
        gschulman@achillion.com
        Investors:
        Mary Kay Fenton
        Achillion Pharmaceuticals, Inc.
        Tel. (203) 624-7000
        mfenton@achillion.com
        Media:
        Christin Culotta Miller
        Ogilvy PR
        Tel. (212) 880-5264
        Christin.Miller@Ogilvy.com

Senator asks for SEC investigation into Vertex Pharmaceuticals executive stock sales...

Posted on 6/7/12 on Bloomberg.com. Could be one of the many reasons Vertex is leaking executives lately, including less-than-forecast Telaprevir sales through week 8 of Q2.

Grassley Questions Timing Of Vertex Stock Sales In Letter

By Drew Armstrong - Jun 7, 2012 2:00 PM PT

Senator Charles Grassley asked U.S. regulators to probe whether Vertex Pharmaceuticals Inc. executives profited unfairly from stock sales before corrected drug data sent shares down.

Calling the sales “a potentially troubling issue for investors in the pharmaceutical industry and for the federal government,” Grassley wrote Securities and Exchange Commission Chairwoman Mary Schapiro to ask her to look into share sales by five company executives and two board members.

Vertex gained 55 percent on May 7 after the company said a study of its experimental cystic fibrosis drug VX-809 combined with Kalydeco helped patients’ breathing. On May 29, the shares fell the most in three years after the Cambridge, Massachusetts- based company revised those results, saying the therapy wasn’t as effective as claimed.

“It could appear that these Vertex (VRTX) executives potentially took advantage of the spike in the stock knowing the news of the clinical data being overstated would be made public eventually, which in turn would negatively affect the stock value,” Grassley said in his letter, dated today.

The executives and two board members got rid of their shares from May 7 to May 29, as part of timed sales, according to Grassley’s letter. He has asked for an answer from the SEC by June 28.

Vertex spokesman Zach Barber said that the share sales had been scheduled ahead of time according to a pre-planned shares process, and that Vertex disclosed the correction to the data quickly.

“All shares sold by our executives and directors were either part of pre-existing 10B5-1 plans or followed Vertex’s internal stock trading policy,” Barber said in an e-mail.

Shares Decline
Vertex shares fell 1.1 percent to $56.77 at the close in New York. The company has gained 4.8 percent in the past 12 months.

Grassley could open his own investigation of the stock sales. The Iowa senator has used his position as the top Republican on the Senate Judiciary Committee and a member of the Senate Finance Committee to investigate potential wrongdoing by health-care companies in the past.

Vertex said on May 29 that a misinterpretation between Vertex and an outside data-analysis firm led to the correction. It doesn’t affect Vertex’s plans to start final-stage trials for U.S. marketing approval, Chief Executive Officer Jeffrey Leiden said on a conference call that day.

John Nester, an SEC spokesman, said the agency had received the letter but declined to comment on its substance.

To contact the reporter on this story: Drew Armstrong in New York at darmstrong17@bloomberg.net;

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net

Vertex receives FDA warning letter on 'misleading branded story'...

Article posted 5/31/12 on Regulatory Focus.com.  Vertex brushes with the FDA over what the FDA considered to be a 'misleading branded story'.  The timing isn't great as Vertex supposedly is getting ready to amend it's labeling, possibly to include BID dosing. 

‘Misleading’ Patient Perspective Smacked Down by FDA in Untitled Letter
Latest News | Posted: 31 May 2012

By Alexander Gaffney

One pharmaceutical company is learning this week that reproducing a patient’s story to “mentor” other potential patients may not sit well with US regulatory authorities, regardless of whether it represents the patient’s perspective accurately.

Cambridge, Massachusetts-based manufacturer Vertex Pharmaceuticals was sent an Untitled Letter by the US Food and Drug Administration (FDA) warning it about its promotion of Incivek (teleprevir), a Hepatitis C (HCV) drug which FDA said was being marketed using a “misleading” branded story.

The branded story is told through the eyes of a patient, “JP”, who tells the audience of his struggle with HIV and subsequent—but difficult—success using Vertex’s Incivek, which he claims “cleared the virus” from his body.

FDA explained in its 25 May letter that Vertex has “overstated” the efficacy of Incivek because it suggests the drug is more effective than “substantial evidence or substantial clinical experience” has shown.

“While these claims may be an accurate reflection of James’ own experience with hepatitis C and treatment with Incivek, this branded story misleadingly implies that most or all cirrhotic prior null responders infected with hepatitis C will successfully achieve Sustained Virologic Response (SVR) on Incivek combination therapy,” wrote FDA in the Untitled Letter. “FDA is not aware of substantial evidence or substantial clinical experience to support this implication.”

Put succinctly, “one patient’s treatment response does not constitute substantial evidence,” said FDA. Further, FDA said the testimonial “misleadingly implies removal of HCV from the body, when this is not the case.” Instead, the virus may well have simply become undetectable while continuing to replicate, noted FDA.

The testimonial also minimized important risk information by downplaying the side effects of the drug, explained FDA. The testimonial recounts “JP” receiving the treatment, which caused him to lose significant amounts of hair and develop a rash. “But that was nothing,” said “JP,” referring to the side effects relative to the benefits of the treatment for him. FDA maintains this “minimizes the risk” of both side effects, and particularly the risks of the rash, which the agency called “serious.”

FDA called on Vertex to stop using the branded story and respond to FDA’s Untitled Letter within 15 days.

A Vertex spokeswoman, Nikki Levy, told The Boston Globe the company has never distributed the story and was now working to revise its content in light of FDA’s informal warning.

Untitled letters are different from official FDA Warning Letters in that they do not include a list of potential agency enforcement actions and are generally less serious than are formal Warning Letters.

J&J open to partnering with Vertex in HCV drug development...

Posted on 4/20/12 on Bloomberg.com. The growing body of evidence in HCV drug development suggests that alliances are important (unless you happen to be Gilead) especially with partners that are owned by deep-pocketed, well diversified organizations like Johnson and Johnson.  Hopefully J&J can put back some luster on Vertex's non-nuc VX-222. Actually, despite it's inherent relative lower barrier of resistance, it's a good drug - QD dosing, pretty powerful, clean and low potential for drug interactions. Just needs the right partners in a regimen. TMC435 may be one of 'em - QD dosing, powerful, no need for ritonavir and thus no ritonavir baggage - sounds good on paper, anyway. 


J&J Open to Expanding Hepatitis C Cooperation With Vertex
By Makiko Kitamura - Apr 20, 2012 8:09 AM PT

Johnson & Johnson (JNJ)’s Janssen unit said it may explore widening cooperation on hepatitis C with Vertex Pharmaceuticals Inc. (VRTX) that may develop in tandem with a separate partnership with Medivir AB (MVIRB) on the disease.

“We remain open to see if we can expand our collaboration,” Gaston Picchio, vice president of Janssen’s global clinical virology and hepatitic disease area, said in an interview today in Barcelona, where he’s attending the European Association for the Study of the Liver annual meeting. “Vertex has announced plans for developing interferon-free therapies. We are partners, so that puts us in a better position to be a part of that,” should studies prove to be promising.

Vertex said on April 18 that it will start enrolling patients in a mid-stage study combining three medicines, excluding interferon, a core component of the current standard of care. Vertex and competitors including Gilead Sciences Inc. (GILD), Bristol-Myers Squibb Co. (BMY) and Abbott Laboratories (ABT) are racing to develop next-generation treatments for hepatitis C that exclude interferon because of flu-like side effects.

Vertex and J&J collaborated to develop telaprevir, marketed as Incivek by Vertex in North America and as Incivo by Janssen in other regions including Europe. The drug was approved by regulators last year as a treatment for hepatitis C in combination with interferon and ribavirin.
Medivir Project

J&J, which has its headquarters in New Brunswick, New Jersey, is also developing the protease inhibitor TMC435 with Huddinge, Sweden-based Medivir, which has said mid-stage trials of the drug in interferon-free combinations with Gilead’s 7977 and with Bristol-Myers’s daclatasvir experimental drugs are starting in the second quarter.

While J&J and Medivir are also developing the TMC647 polymerase inhibitor, Vertex’s VX-222 compound in the same class of drugs is further along in development. VX-222 is one of the three drugs included in Cambridge, Massachusetts-based Vertex’s mid-stage interferon-free treatment study.

Meanwhile, J&J is also “committed” to improving the labeling of Incivo by conducting further trials that examine less frequent dosage as well as efficacy in patients also infected by the HIV virus and those who have had liver transplants, Picchio said.

To contact the reporter on this story: Makiko Kitamura in Barcelona via mkitamura1@bloomberg.net
To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

'The Street' grades the HCV players post-EASL...

The Street's Nathan Sadeghi-Nejad grades the stocks of the big players in HCV post-EASL.  It's a good read, much better than those of his peers, although my opinion on certain topics differs from his in some respects. It's helpful to know that Mr. Sadeghi-Nejad's perspective is from one entrenched in the investment community, a community notorious for knee-jerk reactions to data deemed good or bad simply based on numbers in interim data.  The result is often either 'irrational exuberance' or 'irrational discouragement' causing wild fluctuations in stock price.  Greater scrutiny must often be utilized to get the 'real story' behind the numbers - patient demographics, fibrosis scores, BMI, trial structure, population size, P values, etc.  This is not to devalue the investment community but a call for a more discriminating eye when it comes to data analysis.  Mr. Sadeghi-Nejad's analysis shows a surprising amount of discrimination. My opinion does differ from his in respect to a couple of things (he's awfully hard on Achillion, doesn't mention BI or Merck and... well, see below).


I'll go on record to challenge Mr. Sadeghi-Nejad's claim that interferon is 'dead'. That's a pretty dimissive statement. While interferon-free therapies may be an option for many patients, especially those that are treatment naive, genotype 1b, 2, 3 and 4, with moderate fibrosis, with IL28B CC/TC status. However interferon will most likely play a large role in the 'difficult to treat' population - patients presenting with advanced fibrosis/compensated cirrhosis, genotype 1a, steatosis and IL28B TT status and/or a majority of null-responders.  


In fact, the data from BMS/s EMERGE trail - a head-to-head trial looking at PEG-Lambda + ribavirin vs PEG-interferon-alfa + ribavirin - was horribly under-appreciated. Not only was PEG-Lamda a good deal more effective at achieving SVR than PEG-alfa, there were also significantly less side effects.  We need to see how PEG-Lambda performs with the 2nd and 3rd generation DAAs in these difficult to treat patient populations. There is definitely a need as these patients are most at risk for developing decompensated liver disease and HCC. 


OK, off my soapbox now. 


BARCELONA (TheStreet) -- Wow, it's been a busy few days at the European Association for the Study of the Liver (EASL) annual meeting in this beautiful Catalan capital. Investors obsessed with emerging hepatitis C therapies had plenty of new data to analyze.

Let me make one general observation about the future of hepatitis C treatment before I recap and grade each of the companies with a significant presence at the EASL meeting. Interferon -- the injectable immune system booster saddled with troublesome side effects -- is dead. The future of hepatitis C therapy belongs to interferon-free regimens. Physicians at the conference talked about interferon as if it were invented in medieval times. It's clear that any company seeking a role in hepatitis C going forward must develop or acquire an effective interferon-free regimen or face irrelevance.


Let's move to the winners and losers of EASL 2012.

Gilead Sciences(GILD_):

Grade: A-

Gilead was the big story of the conference. The company emphatically reclaimed the driver's seat in HCV, at least for now, with a combination of solid scientific results and ruthless, strategic maneuvering.

In a crowded Thursday session, anxious Wall Streeters awaited new data for Gilead's GS-7977, a once-daily nucleotide polymerase inhibitor, or "nuc." Despite impressive early data -- which prompted the undeniably expensive $11 billion Pharmasset acquisition -- subsequent results from a GS-7977 trial called ELECTRON showed the drug to have little effect in "null" responders and generated lots of investor anxiety. I was no exception. Despite my favorable disposition towards GS-7977, I wanted confirmation of the early data; most investors I spoke with shared my view.

We got what we were looking for.

An impressive 88% of treatment-naive patients in ELECTRON achieved sustained virologic response four weeks after stopping treatment (an early indication of "cure" known as SVR4) with 12 weeks of GS-7977 and ribavirin (RBV), a companion drug used in hepatitis C. Expectations leading into EASL were for an SVR4 of 70%.

At the same time, Gilead issued a press release containing preliminary data from QUANTUM, an ongoing study in treatment-naive patients also using the GS-7977 plus ribavirin combination therapy. The SVR4 rate in this study was 59%, lower than ELECTRON due to enrollment of more difficult-to-treat patients. [84% of QUANTUM patients had unfavorable "non-CC" genetics, versus 56% in ELECTRON.]

Results from the ELECTRON AND QUANTUM studies of GS-7977 were important but not the star of EASL. What got everyone really excited were data from the mid-stage study combining GS-7977 with Bristol-Myer Squibb's(BMY_) NS5A replication complex inhibitor daclatasvir. Among the patients with genotype 1 hepatitis C, GS-7977 plus daclatasvir resulted in an SVR4 rate of 100%. Yes, the combination therapy cured all treated patients. These data literally elicited high fives from several of the generally reserved hedge fund analysts in attendance. It's hard to argue with an SVR4 of 100%, but longer-term follow-up data are needed to confirm these results. Physicians traditionally use SVR12 (12 weeks) or SVR24 (24 weeks) as a final indication of cure, although recent data show a strong correlation between SVR4 and later follow up assessments.

As if that weren't enough excitement, Gilead also generated some drama at the meeting -- and elicited a "patients-not-profits" rebuke from my colleague Adam Feuerstein -- when word got out that the company had refused an offer from Bristol-Myers to collaborate on further development of GS-7977 and daclatasvir. Although Gilead insists it hasn't made a final decision, I'm guessing management will try to combine GS-7977 with GS-5885, an early-stage drug candidate in the same NS5A class as daclatasvir. Obviously, Gilead wants to keep all the profits from a highly potent, all-oral hepatitis C therapy for itself.

In GS-7977, Gilead appears to control a strong, future "backbone" for any next-generation hepatitis C regimen. I have mixed feelings about Gilead's apparent desire to deny Bristol-Myers access to the drug and therefore prevent a daclatasvir-GS-7977 regimen from reaching the market. Patients and their advocates will probably be justifiably upset that such this apparently highly effective regimen won't be developed further. I understand that. Interestingly, physicians I spoke with at the meeting didn't care either way. That surprised me; I would have expected more complaints.

As an investor, I don't fault Gilead for angling to maximize profits -- I've never subscribed to the biotechnology industry's cloying "patients first" rhetoric. However, the move does increase the company's clinical risk in hepatitis C. Even though initial GS-5885 data look clean, a problem could still emerge and daclatasvir is far more established. Essentially, management is betting that the promise (and eventually, the reality) of an "all Gilead" HCV regimen outweighs additional R&D expenses and near-term clinical risks.

That seems like a reasonable bet, and I think the stock will continue to work -- Gilead is still only trading at around 13 times estimates 2012 earnings.

Bristol-Myers Squibb:

Grade: C

Bristol-Myers had quite the Dickensian conference. The company's daclatasvir plus Gilead's GS-7977 wowed investors and physicians alike. The best of times!

Unfortunately, Gilead doesn't want to partner GS-7977; the non-nucleoside polymerase inhibitor BMS-791325 seems only modestly effective and may have toxicity issues; the protease inhibitor asunaprevir has a messy side effect profile; and adverse event rumors are haunting BMS-986094 (formerly known as INX-189), the "nuc" obtained via the $2.5 billion purchase of Inhibitex. Oh, and brivanib fails in liver cancer. The worst of times!

Gilead's refusal to collaborate raises an important observation. Consider this: Bristol-Myers hasn't made public much data about BMS-986094 since closing the Inhibitex acquisition and non-specific toxicity rumors dogged the drug at EASL. Does this explain why Bristol-Myers is trying to pressure Gilead into moving the daclatasvir-GS-7977 regimen into phase III trials? Put another way, if Bristol-Myers was confident that BMS-986094 (INX-189) could easily replace GS-7977 in a combination regimen with daclatasvir, why not play the same ruthless, "winner take all" game as Gilead?

If I was a Bristol-Myers bull, I would be worrying about the future of BMS-986094 (INX-189.)

Management better hope it can either woo or shame Gilead into collaboration (unlikely, unless something goes wrong with GS-5885) or that the Inhibitex drug plays nice with daclatasvir and the toxicity rumors are false. Otherwise, Bristol-Myers will have to open up the M&A wallet again to remain relevant in the race for next-generation hepatitis C therapies.

Abbott(ABT_):

Grade: B

Despite Wall Street skepticism, I think Abbott remains firmly in the hepatitis C game. The company presented data from two major studies, PILOT and CO-PILOT, in late-breaker sessions on Saturday afternoon.

PILOT enrolled treatment-naive patients to receive 12 weeks of ABT-450 -- a protease inhibitor that requires blood-level "boosting" with ritonavir -- in combination with the non-nucleoside NS5B polymerase inhibitor ABT-072 and ribavirin. It must be noted that all patients had favorable "C/C" genetics, making it an easy group to treat. Nonetheless, Abbott reported an impressive 91% SVR24.

One patient in PILOT suffered a late relapse after 36 weeks of follow up which dropped the SVR36 "cure" rate to 82%. These are some of the longest follow-up results yet with next-generation, all-oral regimens so the relapse was noteworthy. I'm not sure if the relapse is an isolated event, and no one I spoke with had a definitive answer. Keep the question of whether interferon-free regimens might leave patients more susceptible to late relapse in mind -- it needs to be watched closely going forward.

In Abbott's second CO-PILOT study, patients received 12 weeks of ritonavir-boosted ABT-450 and the "non-nuc" ABT-333. Patients in the two treatment-naive arms achieved SVR12 rates of 93% and 95% (These patients were a mix of easy- and hard-to-treat patients more comparable to competitors' studies). I was impressed with these data, as were most physicians at EASL. A third arm in the CO-PILOT study enrolled "non-responders" but generated only a 47% SVR12; these patients need a more robust regimen.

The downside to the CO-PILOT regimen is complexity: ABT-450 is administered once daily, as is ribavirin and ritonavir, whereas ABT-333 is dosed twice daily. Further, ritonavir has numerous drug-drug interactions. Physicians I spoke with at EASL were mixed about whether or not patients could be sufficiently compliant in the real-world setting. I doubt it. Abbott plans to co-formulate future combinations, which will include other drugs (the company also has a NS5A inhibitor.)

I plan on taking a closer look at Abbott in a future column. The company is highly dependent on sales of the rheumatoid arthritis drug Humira, which I don't like, but investors aren't assigning much value to its hepatitis C assets. Based on what I saw at EASL, that could be a mistake.

Idenix Pharmaceuticals(IDIX_):

Grade: B-

Despite having no data at EASL this year, Idenix will likely benefit from the rising tide created by Gilead and Bristol-Myers. After successfully negotiating side effect questions and a partial clinical hold, Idenix has emerged as the only smallish biotech company with both a "nuc" (IDX-184) and an NS5A inhibitor (IDX-719.) By year-end, we will see SVR4 data for IDX-184 combined with interferon and ribavirin; and early data on IDX-719.

If these results look promising, Idenix is going to be hugely attractive to large pharma companies with lackluster hepatitis C programs and an urge to catch up. Novartis(NVS_) already has a first right to license IDX-719 by year-end, but other companies might be interested regardless of the Swiss pharma giant's decision. I would be a buyer of Idenix, but keep any position on the small side.

Achillion Pharmaceuticals(ACHN_):

Grade: C-

Meh. Achillion has two NS5A inhibitors, ACH-3102 and ACH-2928, which look okay in early studies, but I'm not sure what makes these drug candidates stand out. I feel similarly unexcited about ACH-1625, a protease inhibitor, which looked decent in a confusing study that combined it with interferon and ribavirin. I'm just not convinced these are valuable assets, so I'm going to wait on the sidelines.

Vertex Pharmaceuticals(VRTX_):

Grade: D-

Out of sight, out of mind. The big loser of the EASL conference was Vertex Pharmaceuticals. The company's first-in-class protease inhibitor Incivek pioneered treatment with direct-acting antivirals in hepatitis C, but the drug now feels woefully outdated less than one year after approval. The problem is that Incivek therapy still requires patients to receive weekly injections of interferon. Remember what I noted at the top of this column -- interferon is dead -- so any drug attached to interferon is at risk of the same fate.

Vertex does have ongoing interferon-free studies that combine Incivek with ribavirin and VX-222 -- an earlier-stage "non-nuc" drug candidate -- but the combination seems like a long shot. Earlier this year, the company reported that 82% of patients in the Phase II ZENITH trial achieved an SVR4. Vertex also added to its hepatitis C portfolio recently, acquiring two "nucs" through a partnership with Alios BioPharma. Unfortunately, those compounds do not yet have any clinical data and are substantially behind the market leaders.

More from Nathan Sadeghi-Nejad
Calling Shenanigans on Amylin PharmaGilead And The Future of HIV TherapyRegeneron, Amgen And The 'Hope Creation Cycle"
Market Activity
Vertex Pharmaceuticals| VRTX
Gilead Sciences Inc| GILD
Achillion Pharmaceuticals Inc.| ACHN
Meanwhile, I expect already flat Incivek sales will decline rapidly as physicians urge patients to defer treatment until next-generation drugs reach the market. Street estimates now reflect a sequential decline in Incivek sales. If Vertex isn't able to expand use of the cystic fibrosis drug Kalydeco to a broader group of patients at premium pricing, Vertex might be a short. (I haven't done enough work to have a final opinion yet.) Either way, this wasn't a good EASL meeting for the Boston-based biotech.

Onyx Pharmaceuticals(ONXX_):

Grade: B+

EASL is not only about hepatitis C. This is a meeting that covers all liver disease, which includes liver cancer. In this regard, Onyx emerged from EASL a solid winner even though the company presented no new data.

Some investors expected positive results from a 395-patient trial of Bristol-Myers' brivanib in late-stage liver cancer. Positive brivanib data would have been bad news for Onyx, whose key asset, Nexavar, dominates the liver cancer treatment market and faces no major competitors. Fortunately, brivanib proved both a dud and a point.

In a crowded Saturday session, the same investigator who led Onyx's Phase III study presented findings from Bristol-Myers' BRISK-PS, which randomized patients who had progressed on, or were intolerant of, Nexavar to receive either brivanib or placebo. Despite positive response rate (12% versus 2%) and time to progression (4.2 months versus 2.7 months) data, brivanib showed only a slight survival benefit (9.4 months versus 8.2 months). For comparison, Nexavar improved survival by 2.8 months in the Phase III SHARP trial that led to the drug's approval.

Before I get a slew of comments on the value of any benefit in this difficult-to-treat disease, I would note that the data were not even close to statistical significance and brivanib caused meaningful toxicity, including six patient deaths attributed to the drug by study investigators.

The key takeaway here -- other than that Nexavar's leading position in liver cancer remains safe -- is that surrogate endpoints like response rate and progression-free survival do not always correlate with a survival benefit. This is particularly true in studies of solid tumors. Despite what feels like the constant media coverage of emotional demands for quick approvals based on limited data, the BRISK-PS data once again highlight the need for companies to conduct randomized studies using real endpoints.

Whew. That does it for EASL 2012, but my travels continue. This afternoon I'm off to Boston to surprise Mom for her birthday. (Let's see if she reads all the way to the end of my columns.)

Happy birthday Mom!

Disclosure: Sadeghi has no positions in any of the stocks mentioned in this article.

Seeking Alpha - Achillion Pharmaceuticals: Hope, Hype, And Hep C

An article appearing 3/27/12 by Stephen Simpson on Seeking Alpha.com - one of the more level-headed articles appearing on that particular site in recent months, IMO (admittedly, coming from me, that might not mean much!). It's very hard to be prescient in regards to Achillion's future in HCV, but with a wholly-owned, advancing pipeline diversified among viral targets, it has to be considered at least somewhat of a target of companies like Merck, J&J and Vertex that need to fill holes in their pipeline or need compounds with synergistic activity. Mr. Simpson also gives a quick rundown of what's happening in the HCV drug development marketplace as well as some apocryphal statistics on HCV infection within South America that could feasibly boost the value of the HCV market considerably by 2016 over current thinking, in his estimation.   


Achillion Pharmaceuticals: Hope, Hype, And Hep C

By Stephen Simpson - Seeking Alpha

I've followed biotech for a long time now, and I have a hard time thinking of an example of another addressable market like hepatitis C (HCV) where investor interest has just exploded in the space of about a year. Like antisense, monoclonal antibodies, RNAi, genomics, stem cells and every other hot property in biotech, there has been no end of hope, hype, and hucksterism. Although HCV is likely to grow into a very financially significant drug target in the coming years, it's worth wondering just how much of the frenzy today can be justified in long-term valuations.

In particular, I'm curious about Achillion Pharmaceuticals (ACHN) these days. I've watched this stock for a while now and came close to buying on multiple times in the pre-2010 pre-$2 level. I underestimated just how fast this market would heat up, though, and had to re-learn a painful lesson - sometimes, you snooze and you lose.

Achillion jumps out as the only serious HCV play I'm aware of with a market cap below $1 billion (while Idenix (IDIX) is hardly a giant at $1.1 billion). Not only is it relatively small, but it also may be one of the relatively few players with its own home-grown effective combination therapy.

Of course everything Achillion is working on in HCV is still in the clinic and as Gilead (GILD) showed so clearly recently, "surprising" clinical results are not always positive surprises. The end result, then, is that this may be the next Pharmasset or just another biotech destined to flame out.

The Good - Interesting Compounds All Their Own

Achillion has at least two HCV antivirals well worth watching - ACH-1625 and ACH-3102.

ACH-1625 is a potentially pangenotypical NS3 protease inhibitor (PI) that has shown both solid efficacy and encouraging safety in early studies. Showing both strong efficacy and safety thus far, it could perhaps be the backbone for future combination therapies. That said, pangenotypical efficacy is not yet established and the compound still has not gone through a pivotal Phase 3 study.

The good news with antivirals is that, unlikely oncology and anti-inflammatory drugs, efficacy signals in early pilot studies often hold up through pivotal studies. What's more, these studies are relatively easy to enroll and can be completed expeditiously. What that all means for investors is that ACH-1625 could have a relatively quick path to market.

Achillion is also developing ACH-3102, a NS5a inhibitor, and expects to put it in human studies soon. This drug looks like it should be less subject to resistance and the company (as well as bulls) seem more excited about this drug than the more advanced ACH-2928 (also a NS5a inhibitor). Coupled with ACH-1625, this could be a very interesting combo therapy, but it's worth mentioning that almost every drug is interesting to bulls going into Phase 2 studies.

These aren't the only drugs in Achillion's HCV pipeline, and the company does have identified experimental compounds targeting bacterial infections and HIV. It should be noted too that Achillion's HCV pipeline is wholly-owned.

The Bad - Competition, And Expectations, Left Right And Center

Achillion is very definitely not going to be the first company to market with new HCV drugs, and there is apt to be extensive competition in the market. That is not only going to place a premium on the SVR efficacy data and safety profile, but also potentially on the marketing muscle of the company in question.

Since its acquisition of Pharmasset, Gilead was put in the pole position in the race to develop blockbuster HCV drugs. That is, until the company reported Phase 2 data on the superstar-to-be '7977 that showed it is not 100% perfect. Specifically, this Phase 2 study indicated that '7977 may not be effective in null responders (patients who have failed to respond to earlier treatments), and may give new hope to alternate approaches that include a NS5a inhibitor or NS3 protease inhibitor.

That said, a little perspective is in order. Maybe '7977 isn't flawless, but SVR-12 rates of 91% in genotype 1 and 100% in genotypes 2 and 3 in a thus far safe drug is still pretty impressive. Moreover, Gilead is looking at a variety of combination possibilities and while the company would certainly love to have "the one antiviral to rule them all", being a part of a blockbuster combination therapy is not a bad consolation prize.

Along Gilead and Achillion is a host of companies developing therapies and a sea of drugs known more by number than by name.

Bristol-Myers Squibb (BMY) has its NS5a inhibitor daclatasvir well along in studies, a PI ('032), and the NS5b inhibitor it acquired with the Inhibitex deal, as well as other earlier stage compounds. The NS5a inhibitor has shown solid efficacy, and its PI/NS5 combo showed 100% SVR without PEG-interferon or ribavarin.

Of course there are many more. Abbott (ABT) has its own all-oral combination (NS5a and PI), as does Roche (RHHBY.PK), although the efficacy in the Roche compounds has not been as encouraging. Johnson & Johnson (JNJ) has its TMC435 PI that it in-licensed from Medivir, and Boeringher Ingelheim has its PI as well. Indenix has a nucleotide inhibitor and NS5a inhibitor in trials and a non-nuc in preclinical development.

Last and not least are Vertex (VRTX) and Merck (MRK). These companies have brought the two newest HCV drugs to market (Incivek and Victrelis, respectively). Vertex has a PI in trials and two nucleotide inhibitors licensed in from Alios, while Merck's PI has seen a significant setback tied to safety issues.

A Quick Rundown On The Market, Prospects, And Deals

The oft-repeated statistic on HCV says that there are between 130 million and 170 million infected persons around the world. Approximately 4 million of those are in the U.S., with another 5 million the EU. By way of comparison, Brazil is thought to have at least 7 million HCV patients, India at least 10 million, and China 43 million.

Untreated HCV offer leads to severe chronic liver disease (including cirrhosis), but the long-used PEG-interferon and ribavirin therapy (dominated by Roche and Merck) has had success rates of below 50% in long-term usage.

That efficacy underlies a lot of the market expectation on HCV drugs. While the pre-Incivek/Victrelis HCV market was estimated to be about $3 billion (with $2.5 billion of that going to PEG-inteferon), analysts believe better efficacy could drive that figure close to $10 billion in 2016.

Admittedly, that's a large number. It may not be completely out of line, though, if these 90%+ SVR rates hold up in pivotal studies. Offer people with a serious lifelong illness a safer, more effective drug that is also easier to take and you can almost always charge a premium for it. Also, think about it this way - the U.S. and European insurance/payer systems are willing to pay several tens of thousands of dollars for cancer therapies that offer a few extra months of median survival benefit, so there's clearly a willingness to pay for better clinical outcomes.

What's this all mean for Achillion?

I could see ACH-1625 garnering perhaps up to a billion in sales if the early results hold all the way through studies. Moreover, there's the potential to be had from the combo therapy; whether that's in combination with another Achillion drug or a rival compound (like, say, Gilead's '7977). If Achillion could garner $1 billion in sales, that would translate into a fair value of $13 to $18 per share today based upon your forward multiple estimate (6x or 8x).

I'm sure $1 billion in sales will sound too small to Achillion bulls. Fair enough; if the early results hold up, maybe it's an even bigger blockbuster, but it looks like there are going to be a lot of competing therapies on the market and good marketing is going to deliver sales even in inferior compounds.

It may well be the case, though, that Achillion never makes it to the point where its sales matter. I would be quite surprised to see Achillion partner its drugs, but I think a buyout could well happen. Certainly there have been plenty of chatter on that subject, what with Gilead and Bristol-Myers paying up for HCV compounds (and Roche also making some deals of its own).

So how does the M&A scene break out? I don't think Bristol-Myers would need Achillion, and I don't think Gilead would go that route either unless a '7977/ACH-1625 really showed something special. Johnson & Johnson may think it needs non-PI partner compounds and may not want to pay for the overlap between their PI programs.

That said, I think there are a lot of names left that could be interested. Merck arguably needs a better protease inhibitor, and likewise Roche, Abbott, and Vertex may find that they need better compounds than they presently have. Companies like Sanofi (SNY) and GlaxoSmithKline (GSK) aren't doing much here today, but could find Achillion to be a ready-made HCV platform. Odds are, though, that Achillion holds out a bit for a desperate buyer - not because there's anything wrong with its pipeline, but because a desperate Merck or Roche may pony up a better deal if they feel pressure.

The Bottom Line

Taking a midpoint of that earlier $13-$18 range, I'd say Achillion may be worth about $15.50 a share today. Annoyingly, that's almost spot on with the current consensus number. I do believe there could be more upside as its pipeline matures and rivals run into problems, but I usually want more than 50% undervaluation before buying into a new biotech story.

Disclosure: I am long RHHBY.PK

The Street.com: EASL Gives Wall Street's Privileged Investors Sneaky Preview to Key Hep C Data

Article posted on The Street.com on 3/20/12. Spring is in the air, and that means that one of the most important meetings in HCV drug development - EASL - is right around the corner.  The Street author Adam Feuerstein is none too pleased on EASL's rather elitist approach to disseminating important data ahead of time to only a chosen, privileged few. He's right - and he's also right that EASL's attempt at keeping this data embargoed until the actual start of the conference is pert near impossible.  The time has come for reform and revolution. I'd be right there on the front lines, but there's too much good stuff on TV. 

EASL Gives Wall Street's Privileged Investors Sneaky Preview to Key Hep C Data

By Adam Feuerstein    03/20/12 - 10:45 AM

Update: After this column was published, EASL announced a delay in the release of research abstracts for the International Liver Congress to Tues. March 27.

BARCELONA (TheStreet) -- Investing in hepatitis C drug stocks is a suckers bet this week because the European Association for the Study of the Liver, better known as EASL, has rigged the game so that Wall Street's privileged investors get a sneak peek at new clinical data ahead of an important and closely followed conference next month.

EASL's International Liver Congress, taking place April 18-22 in Barcelona, is the must-follow medical meeting of the spring. Gilead Sciences, Bristol-Myers Squibb, Abbott, Idenix Pharmaceuticals, Vertex Pharmaceuticals and Merck are among the companies rolling out new clinical data on experimental hepatitis C therapies.

But if you want an advance look at potentially market-moving hepatitis C drug data, you'll have to be an EASL member or a registered attendee of the EASL meeting -- a group which includes hedge fund and mutual fund portfolio managers and sell-side analysts, all of whom can pay for early access.

EASL plans to selectively distribute hepatitis C drug research abstracts to these folks on Thursday. The same documents will not be made available to the public. That means a select group of investors will have access to potentially stock-moving clinical data while a majority of investors will be kept in the dark.

Journalists registered to cover the EASL meeting will also be granted early access to hepatitis C research abstracts but they are barred by EASL's restrictive embargo rules from writing about any new data until the start of the April meeting.

EASL's abstract distribution policy is misguided, unfair and quite frankly unworkable. Smarter medical and scientific groups like the American Society of Clinical Oncology (ASCO) realized years ago that trying to compartmentalize research abstracts was futile. Information cannot be selectivity disclosed and expected not to leak, especially information that will weigh on the market valuations of biotech and drug firms involved in new hepatitis C drug research.

That's why most medical and scientific groups made research abstracts freely available to everyone in advance of major conferences.

Jacqui Sisto, an EASL spokesperson, explained via email that selective disclosure of research abstracts "ensures the integrity of the International Liver Congress." Really? EASL appears to be corrupting its most important meeting, not making it more honest.

Encouraging Phase II Telaprevir HIV/HCV coinfection treatment data presented at CROI...

Posted on March 6 on Vertex Pharmaceuticals.com: Data presented at CROI from the Phase II Telaprevir trial looking at the safety and effectiveness of Telaprevir + P/R in the HIV/HCV co-infected patient (all on Atripla and Reyataz as their antiretroviral regimen).  While this is SVR12 data and not the 'true' SVR of 24 weeks past End of Treatment (EOT), this data looks encouraging with 74% (28/38) patients undetectable at SVR12.  Given the huge potential of drug-drug-interactions with Telaprevir and antiretroviral regimens, it looks as if the Atripla + Reyataz regimen in combination with TVR + P/R is the one to go with - VERY encouraging in that there have been no HIV breakthroughs while on TVR + P/R + Reyataz + Atripla. The coinfected patient is a critical patients - coinfected individuals have have markedly increased disease progression far and above that of the monoinfected patient.  Considering that Boceprevir cannot be used in the HIV/HCV coinfected patient, Vertex has this niche all to itself until the 2nd gen compounds prove themselves.  I'm sure these interim results come to the relief of many providers who treat this patient population. 

Data from Phase 2 Study of an INCIVEK® Combination Regimen Showed 74% of People Co-Infected with Hepatitis C and HIV Had Undetectable Hepatitis C Virus 12 Weeks After Treatment Ended (SVR12)

- INCIVEK was well tolerated with commonly used Atripla- and Reyataz-based HIV treatment regimens, and no patients experienced HIV breakthrough -

- Enrollment is ongoing in Phase 3 study evaluating 24- and 48-week treatment durations in people who are co-infected -

SEATTLE--(BUSINESS WIRE)-- Vertex Pharmaceuticals Incorporated (Nasdaq: VRTX) today announced interim results from an ongoing Phase 2 study designed to evaluate the safety and tolerability of INCIVEK® (telaprevir) tablets in combination with pegylated-interferon and ribavirin in people who are co-infected with genotype 1 hepatitis C virus and human immunodeficiency virus (HIV). Data showed 74 percent (28/38) of patients who were treated with INCIVEK (in-SEE-veck) combination therapy had undetectable hepatitis C virus (HCV RNA) 12 weeks after the end of all study treatment (SVR12) compared to 45 percent (10/22) who were treated with pegylated-interferon and ribavirin alone. INCIVEK was well tolerated with commonly used Atripla®- and Reyataz®-based HIV treatment regimens. Changes in CD4 counts were similar between the treatment groups and no HIV viral load breakthroughs were observed in either treatment group during the study. The most common adverse events in the INCIVEK arms of the study were fatigue, pruritis (itching), headache, nausea and rash. No cases of severe rash were reported and there were no discontinuations due to rash. Interim results from this study are being presented at the Conference on Retroviruses and Opportunistic Infections (CROI), March 5 to 8, 2012 in Seattle.

"Hepatitis C generally progresses faster, leads to more long-term liver complications and has been harder to cure among people who also have HIV," said Robert Kauffman, M.D., Ph.D., Senior Vice President and Chief Medical Officer at Vertex. "These new INCIVEK data are important as we work toward our goal of helping cure more people with hepatitis C. We're actively enrolling co-infected patients in a Phase 3 study and expect that data from this study will be included in a submission for a supplemental approval of INCIVEK."

The Phase 2 study includes two parts: Part A is evaluating people who are not currently being treated with antiretroviral therapy (ART) for HIV infection and Part B is evaluating those who are taking an Atripla- or Reyataz-based regimen for HIV. This study enrolled patients who were new to hepatitis C treatment (treatment naïve). Patients who were randomized to receive INCIVEK were treated with 12 weeks of INCIVEK, pegylated-interferon and ribavirin, followed by 36 weeks of pegylated-interferon and ribavirin alone. Interim data also showed that 68 percent (26/38) of patients treated with INCIVEK combination therapy in this study had a rapid viral response (RVR, undetectable hepatitis C virus at week 4 of treatment) compared to none (0/22) of the patients who received pegylated-interferon and ribavirin alone.

"There is a great need for treatments that are well tolerated and offer co-infected patients a better chance at a cure for hepatitis C while maintaining suppression of their HIV," said Douglas Dieterich, M.D., Professor of Medicine in the Division of Liver Diseases, Mount Sinai School of Medicine, New York City. "It's very encouraging that nearly three out of four people had undetectable hepatitis C virus 12 weeks after stopping INCIVEK combination therapy and that their HIV medicines continued to work during treatment."

Interim Study Results

Sixty-two people 18 and older were enrolled in this Phase 2 study and 60 received at least one dose of study drug. This analysis was conducted 12 weeks after patients completed all treatment. The ART regimens evaluated in this study were selected based on current HIV treatment guidelines from the U.S. Department of Health and Human Services, International AIDS Society and drug-drug interaction studies of INCIVEK with commonly used ART medicines.

Interim Intent To Treat Analysis of Study #110

Part A (No ART)

Part B Atripla®-based regimen

Part B Reyataz®-based regimen

Total

INCIVEK- based Arm+

Control Arm++

INCIVEK- based Arm+

Control Arm++

INCIVEK- based Arm+

Control Arm++

INCIVEK- based Arm+

Control Arm++

RVR*

71% (5/7)

0% (0/6)

75% (12/16)

0% (0/8)

60% (9/15)

0% (0/8)

68% (26/38)

0% (0/22)

eRVR**

57% (4/7)

0% (0/6)

75% (12/16)

0% (0/8)

47% (7/15)

0% (0/8)

61% (23/38)

0% (0/22)

SVR12

71% (5/7)

33% (2/6)

69% (11/16)

50% (4/8)

80% (12/15)

50% (4/8)

74% (28/38)

45% (10/22)

Atripla-based regimen (efavirenz, tenofovir disoproxil fumarate and emtricitabine): INCIVEK was dosed at 1,125 mg, every 8 hours (q8h).

Reyataz-based regimen (ritonavir-boosted atazanavir, tenofovir disoproxil fumarate and emtricitabine or lamivudine): INCIVEK was dosed at 750 mg, every 8 hours (q8h).

*RVR: Rapid Viral Response; undetectable HCV RNA at week 4.

**eRVR: extended Rapid Viral Response; undetectable HCV RNA at weeks 4 and 12.

+12 weeks of INCIVEK, Pegasys® (PEG, pegylated-interferon alfa-2a) and Copegus® (RBV, ribavirin) followed by 36 weeks of only PEG and RBV.

++48 weeks of PEG and RBV only for hepatitis C treatment.

             
Atripla-based regimen (efavirenz, tenofovir disoproxil fumarate and emtricitabine): INCIVEK was dosed at 1,125 mg, every 8 hours (q8h).

Reyataz-based regimen (ritonavir-boosted atazanavir, tenofovir disoproxil fumarate and emtricitabine or lamivudine): INCIVEK was dosed at 750 mg, every 8 hours (q8h).

*RVR: Rapid Viral Response; undetectable HCV RNA at week 4.
**eRVR: extended Rapid Viral Response; undetectable HCV RNA at weeks 4 and 12.

+12 weeks of INCIVEK, Pegasys® (PEG, pegylated-interferon alfa-2a) and Copegus® (RBV, ribavirin) followed by 36 weeks of only PEG and RBV.
++48 weeks of PEG and RBV only for hepatitis C treatment.

The majority of adverse events in this study were mild or moderate. Adverse events that occurred more frequently in the INCIVEK arms compared to placebo (≥10 percent difference) were pruritis (itching), headache, nausea, rash, fever, and depression. Three patients, all in Arm B, discontinued all study treatment due to adverse events (one each due to gall stones, hemolytic anemia and nausea/vomiting).

About this Phase 2 Study

Vertex and its collaborator Janssen conducted extensive drug-drug interaction studies with INCIVEK and commonly used HIV medicines prior to initiating a development program in people co-infected with hepatitis C (HCV) and HIV. This Phase 2 study is a two-part (A and B), randomized, double-blind, placebo-controlled, parallel group, multi-center study in people chronically infected with both HCV and HIV who were new to HCV treatment. The primary endpoint of the study is to evaluate the safety and tolerability of INCIVEK combination therapy in people co-infected with HCV and HIV. A secondary endpoint is to evaluate rates of sustained viral response (SVR) 12 and 24 weeks after the end of treatment. The study is being conducted by Vertex in collaboration with Janssen.

Phase 3 Study Actively Enrolling

Enrollment is ongoing in a Phase 3 study evaluating 24- and 48-week response-guided regimens of INCIVEK combination therapy in people co-infected with HCV and HIV. Patients who are either new to treatment for HCV, or who had relapsed after at least one prior course of therapy with pegylated-interferon and ribavirin alone, will receive 24 or 48 weeks of INCIVEK combination treatment, based on their antiviral response. Patients who had not responded to a prior course of treatment (partial responders and nulls) will receive 48 weeks of INCIVEK combination treatment. A similar study is also being initiated by Janssen in its territories.

Data from In Vitro Evaluation of INCIVEK and HIV Protease Inhibitors

Also being presented at CROI this week are data from an in vitro evaluation of the anti-HIV activity of four HIV protease inhibitors (amprenavir, darunavir, lopinavir and atazanavir) in combination with INCIVEK. In the study, no antagonistic effects on the antiviral activity were observed when INCIVEK was used in combination with amprenavir, darunavir, and lopinavir, and slight antagonistic effects were observed on the antiviral activity of atazanavir.

About INCIVEK

INCIVEK ® (telaprevir) tablets is an oral medicine that acts directly on the hepatitis C virus protease, an enzyme essential for viral replication. INCIVEK is the most prescribed direct-acting antiviral for the treatment of adults with genotype 1 chronic hepatitis C and has been used to treat more than 30,000 people in the United States.

INCIVEK was approved by the U.S. Food and Drug Administration (FDA) in May 2011 and by Health Canada in August 2011 for use in combination with pegylated-interferon and ribavirin for people with genotype 1 chronic hepatitis C with compensated liver disease (some level of damage to the liver but the liver still functions), including cirrhosis (scarring of the liver). INCIVEK is approved for people who are new to treatment, and for people who were treated previously with interferon-based treatment but who did not achieve a sustained viral response, or viral cure (relapsers, partial responders and null responders).

Vertex developed telaprevir in collaboration with Janssen and Mitsubishi Tanabe Pharma. Vertex has rights to commercialize telaprevir in North America where it is being marketed under the brand name INCIVEK (in-SEE-veck). Janssen has rights to commercialize telaprevir in Europe, South America, Australia, the Middle East and certain other countries. In September 2011, telaprevir was approved in the European Union and Switzerland. Telaprevir is known as INCIVO® in Europe. Mitsubishi Tanabe Pharma has rights to commercialize telaprevir in Japan and certain Far East countries. In September 2011, telaprevir was approved in Japan and is known as Telavic®.

INCIVEK® is a registered trademark of Vertex Pharmaceuticals Incorporated.

PEGASYS® and COPEGUS® are registered trademarks of Hoffmann-La Roche.

Reyataz® is a registered trademark of Bristol-Myers Squibb.

Atripla® is a registered trademark of Bristol-Myers Squibb and Gilead Sciences, LLC.

About Hepatitis C

Hepatitis C is a serious liver disease caused by the hepatitis C virus, which is spread through direct contact with the blood of infected people and ultimately affects the liver.1 Chronic hepatitis C can lead to serious and life-threatening liver problems, including liver damage, cirrhosis, liver failure or liver cancer.1 Though many people with hepatitis C may not experience symptoms, others may have symptoms such as fatigue, fever, jaundice and abdominal pain.1

Unlike HIV and hepatitis B virus, chronic hepatitis C can be cured.2 However, approximately 60 percent of people do not achieve SVR,3,4,5 or viral cure,6 after treatment with 48 weeks of pegylated-interferon and ribavirin alone. If treatment is not successful and a person does not achieve a viral cure, they remain at an increased risk for progressive liver disease.7,8

More than 170 million people worldwide are chronically infected with hepatitis C.6 In the United States, nearly 4 million people have chronic hepatitis C and 75 percent of them are unaware of their infection.9 Hepatitis C is four times more prevalent in the United States compared to HIV.9 The majority of people with hepatitis C in the United States were born between 1946 and 1964, accounting for two of every three people with chronic hepatitis C.10 Hepatitis C is the leading cause of liver transplantations in the United States and is reported to contribute to 4,600 to 12,000 deaths annually.11,12 By 2029, total annual medical costs in the United States for people with hepatitis C are expected to more than double, from $30 billion in 2009 to approximately $85 billion.9

About Hepatitis C and HIV Co-Infection

There are 1 million people living with HIV in the United States, and an estimated 300,000 people living with HIV/AIDS in the United States are also infected with hepatitis C. 13 There have been dramatic improvements in the treatment of HIV and the prognosis for people living with HIV. However, liver disease progresses more rapidly in people co-infected with hepatitis C and HIV, with an increased rate of progression to cirrhosis, decompensated liver disease, hepatocellular carcinoma and death. 14, 15, 16, 17 The hepatitis C cure rate with a 48-week treatment of pegylated-interferon and ribavirin, the current standard of care for people with co-infection, is approximately 29 percent.18

About Vertex

Vertex creates new possibilities in medicine. Our team discovers, develops and commercializes innovative therapies so people with serious diseases can lead better lives.

Vertex scientists and our collaborators are working on new medicines to cure or significantly advance the treatment of hepatitis C, cystic fibrosis, rheumatoid arthritis, epilepsy and other life-threatening diseases.

Founded more than 20 years ago in Cambridge, MA, we now have ongoing worldwide research programs and sites in the U.S., U.K. and Canada. Today, Vertex has more than 2,000 employees around the world, and Science magazine named Vertex number one on its 2011 list of Top Employers in the life sciences.

Vertex's press releases are available at www.vrtx.com.

Special Note Regarding Forward-Looking Statements

This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including Dr. Kauffman's statements in the second paragraph of this press release and statements regarding ongoing and planned Phase 3 studies of INCIVEK combination therapy in people co-infected with HCV and HIV. While the company believes the forward-looking statements contained in this press release are accurate, there are a number of factors that could cause actual events or results to differ materially from those indicated by such forward-looking statements. Those risks and uncertainties include, among other things, that the outcomes from future clinical trials of INCIVEK combination therapy in co-infected patients may not be favorable and the other risks listed under Risk Factors in Vertex's annual report and quarterly reports filed with the Securities and Exchange Commission and available through Vertex's website at www.vrtx.com. Vertex disclaims any obligation to update the information contained in this press release as new information becomes available.

IMPORTANT SAFETY INFORMATION

Indication

INCIVEK® (telaprevir) is a prescription medicine used with the medicines peginterferon alfa and ribavirin to treat chronic (lasting a long time) hepatitis C genotype 1 infection in adults with stable liver problems, who have not been treated before or who have failed previous treatment. It is not known if INCIVEK is safe and effective in children under 18 years of age.

Important Safety Information

INCIVEK should always be taken in combination with peginterferon alfa and ribavirin. Ribavirin may cause birth defects or death of an unborn baby. Therefore, a patient should not take INCIVEK combination treatment if she is pregnant or may become pregnant, or if he is a man with a sexual partner who is pregnant. Patients must use two forms of effective birth control during treatment and for the 6 months after treatment with these medicines. Hormonal forms of birth control, including birth control pills, vaginal rings, implants or injections, may not work during treatment with INCIVEK.

INCIVEK and other medicines can affect each other and can also cause side effects that can be serious or life threatening. There are certain medicines patients cannot take with INCIVEK combination treatment. Patients should tell their healthcare providers about all the medicines they take, including prescription and non-prescription medicines, vitamins and herbal supplements.

INCIVEK can cause serious side effects including skin reactions, rash and anemia that can be severe. The most common side effects of INCIVEK include itching, nausea, diarrhea, vomiting, anal or rectal problems, taste changes and tiredness. There are other possible side effects of INCIVEK, and side effects associated with peginterferon alfa and ribavirin also apply to INCIVEK combination treatment. Patients should tell their healthcare providers about any side effect that bothers them or doesn't go away.

Please see full Prescribing Information for INCIVEK including the Medication Guide, available at www.INCIVEK.com.

(VRTX-GEN)

References:

1 Centers for Disease Control and Prevention. Hepatitis C Fact Sheet: CDC Viral Hepatitis. Available at: http://www.cdc.gov/hepatitis/HCV/PDFs/HepCGeneralFactSheet.pdf. Accessed February 22, 2012.

2 Pearlman BL and Traub N. Sustained Virologic Response to Antiviral Therapy for Chronic Hepatitis C Virus Infection: A Cure and So Much More. Clin Infect Dis. 2011 Apr;52(7):889-900.

3 Manns MP, McHutchison JG, Gordon SC, et al. Peginterferon alfa-2b plus ribavirin compared with interferon alfa-2b plus ribavirin for initial treatment of chronic hepatitis C: a randomised trial. Lancet. 2001;358:958-965.

4 Fried MW, Shiffman ML, Reddy KR, et al. Peginterferon alfa-2a plus ribavirin for chronic hepatitis C virus infection. N Engl J Med. 2002;347:975-982.

5 McHutchison JG, Lawitz EJ, Shiffman ML, et al; IDEAL Study Team. Peginterferon alfa-2b or alfa-2a with ribavirin for treatment of hepatitis C infection. N Engl J Med. 2009;361:580-593.

6 Ghany MG, Strader DB, Thomas DL, Seeff, LB. Diagnosis, management and treatment of hepatitis C; An update. Hepatology. 2009;49 (4):1-40.

7 Morgan TR, Ghany MG, Kim HY, Snow KK, Lindsay K, Lok AS. Outcome of sustained virological responders and non-responders in the Hepatitis C Antiviral Long-Term Treatment Against Cirrhosis (HALT-C) trial. Hepatology. 2008;50(Suppl 4):357A (Abstract 115).

8 Veldt BJ, Heathcote J, Wedmeyer H. Sustained virologic response and clinical outcomes in patients with chronic hepatitis C and advanced fibrosis. Annals of Internal Medicine. 2007; 147: 677-684.

9 Institute of Medicine of the National Academies. Hepatitis and liver cancer: a national strategy for prevention and control of hepatitis B and C. Colvin HM and Mitchell AE, ed. Available at: http://www.iom.edu/Reports/2010/Hepatitis-and-Liver-Cancer-A-National-Strategy-for-Prevention-and-Control-of-Hepatitis-B-and-C.aspx. Updated January 11, 2010. Accessed February 22, 2012.

10 Pyenson B, Fitch K, Iwasaki K. Consequences of hepatitis C virus (HCV): Costs of a baby boomer epidemic of liver disease. Available at: http://www.natap.org/2009/HCV/051809_01.htm. Updated May 2009. Accessed February 22, 2012. This report was commissioned by Vertex Pharmaceuticals, Inc.

11 Volk MI, Tocco R, Saini S, Lok, ASF. Public health impact of antiviral therapy for hepatitis C in the United States. Hepatology. 2009;50(6):1750-1755.

12 Davis GL, Alter MJ, El-Serag H, Poynard T, Jennings LW. Aging of hepatitis C virus (HCV)-infected persons in the United States: A multiple cohort model of HCV prevalence and disease progression. Gastroenterology. 2010;138:513-521.

13 HIV Advocate. HIV/HCV Coinfection. Available at: http://www.hcvadvocate.org/hepatitis/factsheets_pdf/HIV_HCV20coinfecton_10.pdf. Accessed February 28, 2012.

14 Martin-Carbonero L, Benhamou Y, Puoti M, Berenguer J, Mallolas J, Quereda C, et al. Incidence and predictors of severe liver fibrosis in human immunodeficiency virus-infected patients with chronic hepatitis C: a European collaborative study. CID 2004;38:128-33.

15 Martinez-Sierra C, Arizcorreta A, Diaz F, Roldan R, Martin-Herrera M, Perez- Guzman E, et al. Progression of chronic hepatitis C to liver fibrosis and cirrhosis in patients coinfected with hepatitis C virus and human immunodeficiency virus. CID 2003;36:491-8.

16 Matthews GV, Dore GJ. HIV and hepatitis C coinfection. JGH. 2008; 23: 1000-1008.

17 Bruno R, Sacchi P, Puoti M, Soriano V, Filice G. HCV chronic hepatitis in patients with HIV: clinical management issues Am J Gastroenterol 2001; 97:1598—1606.

18 Levin, J. Pegasys/RBV in APRICOT Study- Adherence Improves SVR 300% in genotype 1. Available at: http://www.natap.org/2005/ICAAC/icaac_31.htm Accessed February 28, 2012.



Vertex Pharmaceuticals Incorporated

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Maketwatch asks "Can Vertex Pharma shares stage a comeback?"

(Posted on Marketwatch 2/10/12). Quick speculative answer to the question, probably not in the near term. The remainder of Vertex's HCV portfolio either is in the latter stages of development and doesn't look like a contender for the 'interferon-free' Holy Grail, or in the case of their nucs, pretty far back in development and to say anything about them at this point would be grossly premature. Incivek sales have slowed more than forecasted for the current months in Q1 2012, although we've a month and a half to see another spike. The best bet for real value is their "ultra-orphan' CF drugs, which are impressive. I can't think of a disease state more deserving of better drugs. The population here is limited however, with the size of the disease state only being a fraction of what it is for HCV. Vertex may have taken this into consideration however, with a whopping price of $300,000 for a course of treatment.)



Can Vertex Pharma shares stage a comeback?




By Val Brickates Kennedy, MarketWatch
BOSTON (MarketWatch) — Can Vertex Pharmaceuticals Inc. shares stage a comeback?


That’s a nagging question for investors, who have watched Vertex’s once-bright star fade as the shares of rival hepatitis C-drug developers turn supernova. But Vertex shares could get a good stoking by mid-year, when the results of three key drug studies are due out.


Vertex’s stock had a banner 2011, its shares propelled to new heights by enthusiasm for its drug Incivek, a treatment for the hepatitis C virus, or HCV, a potentially deadly disease that attacks the liver. The drug belongs to a class of medications known as protease inhibitors that also includes Merck & Co. new HCV drug Victrelis.


In recent months, however, investor faith in Incivek’s long-term marketability has been deeply shaken by positive news about rival HCV drugs in development, particularly those in a class of drugs known as nucleotides, or “nukes.”


As a result, shares of Vertex swung from a 52-week peak of $58.87 in mid-May 2011, to a low of $26.50 by late November, when Gilead Sciences Inc. GILD +0.28%   announced it was buying nuke-drug developer Pharmasset Inc. for $11 billion, a move that further underscored the perceived value of nuke drugs. Read more on M&A among HCV drug makers.


Over the past couple of months, the stock has managed to climb back into the upper $30s, due largely to anticipation ahead of the expected approval of the company’s drug Kalydeco. A novel treatment for the genetic disease cystic fibrosis, or CF, Kalydeco won approval earlier this month.


What’s still haunting the stock, say analysts, is concern about how well Incivek sales will hold up when the first nuke drugs hit the market and how well Vertex will be able to build-out its HCV and CF franchises.


With key clinical data for both drug programs looming on the horizon, many analysts have taken a wait-and-see approach to the stock. According to FactSet, the average analyst rating currently for Vertex is overweight, with a price target of just over $46 a share.


Two upcoming events, however, could give the shares a needed jolt.


The first is the expected release of early clinical data for two HCV nuke drugs that Vertex is co-developing with Alios BioPharma. The data is expected in the second quarter.


“Vertex’s HCV franchise is quickly becoming obsolete; to stay in the race, Vertex has to develop all oral, pan-genotypic combinations as quickly as possible, and the Alios nukes are the key to such hope,” wrote William Blair analyst Katherine Xu in a recent note about the significance of the data.


Xu recently lowered her price target for Vertex to $44 from $45, citing slower than expected sales of Incivek, but maintained her buy rating on the stock.


The second set of data, which involves the company’s CF drugs, could be the real market mover, however.


“Positive results in CF could get the stock moving again,” said Needham & Co. analyst Alan Carr, who also has a hold rating on the stock.


The CF data will be from a Phase II trial that is testing Kalydeco, which is only approved for use in CF patients with a rare gene mutation called G551D, or about 4% of CF patients, with another experimental CF drug dubbed VX-809.


Vertex is banking that the Kalydeco/VX-809 combo can successfully treat patients with the F508del gene mutation, which is carried by up to 90% of all CF patients. The data is expected mid-year.


Kalydeco, by the way, isn’t cheap. At nearly $300,000 a year, it ranks as one of the most expensive drugs on the market. It’s high price is due in part to its regulatory status as an “ultra-orphan” drug. The regulatory designation is designed to encourage the development of drugs for life-threatening and extremely rare conditions by offering certain financial incentives, such as market exclusivity.


Carr said that even with its current narrow prescribing indication, Kalydeco could reach peak sales of $1 billion a year. Even if Vertex were forced to lower the price of the product, which would like happen if it were approved for a much larger patient population, sales could still be in the billions.


“According to our probability-adjusted net present value model, for every 10% increase in the probability of success for the combo, Vertex’s stock will have $4-$5 per share in upside, representing a powerful lever,” wrote Xu, of the CF drugs.


“We believe there is a good chance for the Phase II combo data to be successful, which may compensate for the decline of the HCV franchise and lead to the next leg of growth for Vertex,” Xu added.


That said, the Kalydeco data may also prove to be a bust. Data from an earlier segment of the Phase II trial showed the combination to be only modestly effective. Vertex is hoping that data from a second segment of the trial, which is administering VX-809 in higher doses over a longer period of time, yields more impressive results.


“People are getting pretty excited, but I’m just not there yet,” said JMP Securities analyst Liisa Bayko in a recent interview. Bayko currently has a hold rating on the stock. 


Val Brickates Kennedy is a reporter for MarketWatch in Boston.