By Adam Feuerstein 04/13/12 - 05:30 AM EDT
BOSTON (TheStreet) -- Let's roll with this week's Biotech Stock Mailbag.
Jackson P. asks, "Is there any data that has not leaked from EASL which will be important to the hepatitis C stocks?"
The EASL meeting kicks off officially April 18 and runs through April 22. As Jackson notes, I've written a lot about selective disclosure of research abstracts and data leaks leading up to the EASL meeting, but let's now focus attention on investor expectations for new data to be presented at the meeting and what it may mean for hepatitis C drug stocks.
First, just a bit of background to help frame the issues: Today's standard of care for treatment-naive hepatitis C patients is 12 weeks of Vertex Pharmaceuticals'(VRTX_) Incivek (taken three times daily) plus six months of injectable interferon (once weekly) and a daily oral dose of ribavirin. Cure rates with the Incivek regimen range from 75% to 80%. For patients who achieve a rapid, early response to Incivek therapy, cure rates can get as high as 90%.
Incivek was, and still is, a breakthrough for hepatitis C therapy because cure rates with interferon and ribavirin alone were only in the 40%-50% range and treatment lasted twice as long -- 48 weeks versus 24 weeks.
Less than a year after Incivek's approval, the hepatitis C world has moved on to fixate on "all-oral" therapies -- combination of drugs that no longer require the bothersome weekly injections of interferon. That's what the EASL meeting is all about.
Investors are insanely focused on two studies of Gilead Sciences'(GILD_) newly acquired hepatitis C drug GS-7977. Both studies enroll treatment-naive hepatitis C patients and treat them with a combination of '7977 and ribavirin. [That's two pills, once per day.]
The first study, dubbed "Electron," enrolled 25 patients with genotype 1 form of the Hep C virus, the most difficult form of the virus to treat and also the most prevalent in North America. Patients were treated with '7977 plus ribavirin for 12 weeks, then followed to see if they were cured, meaning no detectable levels of the hepatitis C virus remained in their body.
At EASL, Gilead-sponsored researchers will present so-called "SVR4" results from the Electron trial. That's Hep C medical jargon for the percentage of patients who are virus-free four weeks after treatment ends. Patients aren't deemed "cured" of hepatitis C unless they remain virus-free for 12 weeks following treatment, i.e. SVR12 but SVR4 results will be an early and important marker of '7977's efficacy.
OK, what to expect? A 60% SVR4 rate, according to a poll of 204 Wall Street investors conducted by Mark Schoenebaum, the biotech and pharmaceuticals analyst at ISI Group.
The second Gilead study is dubbed Quantum and is also using a combination regimen of '7977 and ribavirin, although patients in this study have genotypes 1,2 or 3 (the latter two being a bit easier to treat). The other major difference between Quantum and Electron is that treatment duration in Quantum is 24 weeks.
Gilead is not presenting Quantum results at EASL but is expected to issue a press release with data from the study early this quarter, which could come any day.
Expectations? Again, from the same Schoenebaum investor survey: 62% SVR4 for the genotype 1 patients from Quantum.
Remember, Gilead spent $11 billion to acquire Pharmasset and gain control of GS-7977 in an audacious bid to wrest a front-runner spot in the race to develop the most effective all-oral Hep C therapy. Billions of dollars in future Hep C drug sales are riding on GS-7977. That's why investors are so heavily focused on next week's EASL meeting. Contributing to the collective Wall Street agita are poor results from GS-7977 in previously treated Hep C patients announced in February.
One more EASL study to watch very closely: A combination of Bristol-Myers Squibb's(BMY_) daclatasvir with Gilead's '7977 in patients with genotypes 1,2 and 3. Early results from this study leaked this week. Ninety-seven percent of genotype 1 hepatitis C patients treated with daclatasvir-'7977 had undetectable viral levels after 12 weeks of treatment. For genotype 2/3 patients, the 12-week response rate was 90%.
At EASL, researchers are expected to present SVR4 results -- but for how many patients and which Hep C genotype isn't entirely clear.
This study is important for several reasons. It's the first time we'll see "cure rate" data from a combination of these two types of drugs. [Daclatasvir is an NS5a inhibitor; '7977 is a nucleoside polymerase inhibitor.]
If the results are impressive, Bristol-Myers could conceivably move ahead quickly with the development of its own all-oral regimen -- combining daclatasvir witih INX-189, the nucleoside polymerase inhibitor acquired through the purchase of Inhibitex.
Likewise, Gilead could move forward with a combination of '7977 and its own internal NS5a inhibitor GS-5885.
As above, ISI Group's Schoenebaum asked his Wall Street investor clients to forecast the results from the daclatasvir-'7977 study. Expectations: An SVR4 rate of 77%.
EASL is a busy meeting so while I highlight these three studies as the most important for investors, I don't mean to short-change data expected from Abbott(ABT_), Johnson & Johnson(JNJ_), Idenix Pharmaceuticals(IDIX_) and Vertex Pharmaceuticals(VRTX_), among others. I'll be covering the conference as will health-care investor and TheStreet contributor Nathan Sadeghi-Nejad. In fact, he'll be in Barcelona attending the conference.