January 14, 2014

Bristol-Myers Ties Hepatitis C Success to Gilead’s Pill

By Drew Armstrong Jan 14, 2014 8:25 AM ET

Bristol-Myers Squibb Co. will try to grab an early share of the multibillion-dollar market for new hepatitis C treatments by piggybacking its experimental drug with Gilead Sciences Inc.’s approved pill.

Bristol-Myers and Gilead are among several companies developing new hepatitis C therapies relying on combinations of two or more drugs. Those regimens are being approved by regulators one drug at a time for a hepatitis C market analysts estimate may reach $100 billion over a decade.

Bristol-Myers is seeking European approval of its drug, daclatasvir, and wants to pair it with Gilead’s Sovaldi before Gilead gains clearance for its second hepatitis C treatment. They will do the same in the U.S. if they can get a broad approval from regulators, said Charles Bancroft, the chief financial officer for Bristol-Myers, in an interview at the JPMorgan Chase & Co. health-care conference in San Francisco.

In “the potential approval of daclatasvir in Europe, the label should be expansive enough to use with sofosbuvir,” Bancroft said, referring to Solvadi by its scientific name. “Hopefully what we do in Europe, we can parlay some of that to here in the U.S.,”

Bristol-Myers, based in New York, is focusing its effort on antiviral treatments, cancer drugs and specialty medicines. It ended its work on diabetes treatments last month, selling a stake in a joint venture with London-based AstraZeneca Plc for as much as $4.3 billion.

Bristol-Myers shares fell 1.4 percent to $55.42 in New York trading yesterday. Gilead, based in Foster City, California, dropped 2.3 percent to $73.41.

4 Million Americans

The move on the hepatitis C pills is a part of a competition by drugmakers to reach the market with new treatments that are more convenient and produce fewer side effects than current therapies including injections. About 4 million Americans have the viral infection, which can cause liver cirrhosis, and U.S. health officials recommended every American born from 1945 to 1965 get tested for the disease.

Gilead’s Sovaldi became the first all-oral treatment for certain hepatitis C patients when it was approved in December by the U.S. Food and Drug Administration. Johnson & Johnson and Medivir AB won FDA approval in November for their pill, Olysio, to be used in combination with other medicines including current treatments.

Gilead is testing other drugs to produce a full combination treatment, which may not be available until the end of 2014 or the beginning of 2015. Bristol-Myers’s combination may not be ready until later.

The drugs from Gilead and Bristol-Myers have been studied together. In a trial of 41 patients released last year, every patient who took the drugs and was followed up with was free of the virus 12 weeks later. The companies haven’t been able to reach an agreement on further testing, though.

Sales Estimates

The combinations are projected to be blockbusters once approved. Gilead’s Sovaldi is priced at $84,000 per treatment, and is projected to sell $8.22 billion in 2016, according to an average of 11 analysts’ estimates compiled by Bloomberg. Abbvie Inc. and Merck & Co. are also developing treatments.

“My personal view is that Gilead is going to get the lion’s share, bni ushealth strut there is room for other players,” Bancroft said. Once combinations from Bristol-Myers and rivals are cleared for the market, competition will drive prices down, he said.

Gilead said it is moving ahead with its combination out of necessity.

“We believe that we have been able to advance the development of this fixed-dose combination much more quickly than would have been possible with any inter-company collaboration,” Norbert Bischofberger, Gilead’s head of research and development, said in an e-mail. “Gilead remains focused on delivering the simplest and safest all-oral treatment regimen to patients as quickly as possible.”

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


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