Incivek | What You Need To Know About Incivek

Hepatitis C virus (HCV) protease inhibitors are not cost-effective for first-time treatment takers with HCV genotype 1 and the IL-28B CC genotype, according to analysis conducted by Ziad Gellad, MD, MPH, of Duke University Medical Center in Durham, North Carolina, and his colleagues. They reported their findings on Monday, November 7, at the 62nd annual meeting of the American Association for the Study of Liver Diseases (AASLD) in San Francisco. According to the study authors, people with the IL-28B CC genotype are more likely to be cured with pegylated interferon and ribavirin alone than people with the IL-28B CT or TT genotypes, for whom the addition of either Incivek (telaprevir) or Victrelis (boceprevir) may be more cost effective.

A 24- to 48-week course of pegylated interferon and ribavirin ranges from $18,000 to $30,000. As Gellad noted, “adding Incivek (telaprevir) or Victrelis (boceprevir)”—both recently approved HCV protease inhibitors—“more than doubles the cost of therapy, to a range of $48,000 to $85,000.”

An advantage of Incivek and Victrelis is that they can improve the effectiveness of treatment when added to a combination of pegylated interferon and ribavirin. This is particularly true for people with the IL-28B CT or TT genotype, which is believed to reduce the effectiveness of pegylated interferon, which remains a backbone of hepatitis C treatment. Conversely, those with the IL-28B CC genotype are much more likely to respond effectively to pegylated interferon-ribavirin therapy. Thus, it remains unclear if adding either Incivek or Victrelis to pegylated interferon/ribavirin—provided that the patient has an IL-28B CC genotype and is starting therapy for the first time—translates into added effectiveness worth the additional cost of either drug.

The authors created a model that allowed them to analyze three HCV treatment strategies. The first strategy involved 48 weeks of treatment with pegylated interferon plus ribavirin. The second strategy involved 24 weeks of pegylated interferon and ribavirin according to response-guided therapy (RGT) rules, which take into consideration viral load measurements at weeks four and 12 of treatment. The third strategy involved 12 weeks of Incivek in combination with either 24 or 38 weeks of pegylated interferon plus ribavirin.

According to the analysis by Gellad’s team, the cure rates among first-time treatment takers with the CC genotype were similar, yet the costs of each regimen varied considerable. Among those who qualified for 24 weeks of RGT with pegylated interferon and ribavirin alone, the cure rate was expected to be roughly 71 percent at a cost of $46,785. The cost increased to $54,931 when interferon/ribavirin was used for a total of 48 weeks, with an expected cure rate of 66 percent. If retreatment was necessary in either circumstance, roughly 87 percent to 91 percent would be cured.

Starting hepatitis C treatment with an Incivek-inclusive regimen was expected to cure 89 percent of HCV-positive individuals with the CC IL-28B genotype—at a cost of $68,788. According to estimates of lifetime treatment costs and quality-adjusted life-years (QALYs) measurements, however, the gain did not differ significantly compared with the other two strategies.

Adding Incivek to pegylated interferon and ribavirin was cost-effective for first-time treatment takers in certain circumstances, Gellad and his colleagues noted, such as when it enhanced the early response to hepatitis C treatment (known as extended rapid virologic response, or eRVR). An eRVR—when hepatitis C viral load is undetectable at treatment week 4 and remains that way at week 12—is a strong predictor of being cured. Incivek was considered cost-effective when it boosted the eRVR rate to 89 percent. For people who did not have an eRVR, Incivek was cost effective if it could increase cure rates to over 80 percent. In addition, the authors considered Incivek to be cost-effective for retreating people who relapsed or did not respond to dual therapy.

In summary, for first-time treatment takers with the IL-28B CC genotype, adding Incivek “is unlikely to be cost-effective under current cost and efficacy conditions,” said Gellad, who concluded by recommending research to compare effectiveness of treatment with and without an HCV protease inhibitor in this group.

BOSTON (TheStreet) — Welcome to the post-Thanksgiving, intra-Black Friday Biotech Stock Mailbag 2011 review and report card.

I totally called Pharmasset’s(VRUS_) acquisition last January. Unfortunately, none of the other five bio-pharma takeout predictions I made at the same time — Amarin(AMRN_), Seattle Genetics(SGEN_), Onyx Pharmaceuticals(ONXX_), Human Genome Sciences(HGSI_) and Biomarin Pharmaceuticals(BMRN_) — came true. Maybe next year!

All joking aside, the Mailbag focused a lot on hepatitis C this year — the biotech investment story of 2011 by a wide margin. In April, I called Pharmasset’s remarkable stock run — up 50% at that time to $78 per share — justified and sustainable given the excitement around its oral Hep C drug candidates, most notably PSI-7977.

It’s hard to believe now, but in April, Pharmasset’s enterprise value was “only” $2.5 billion compared to Vertex Pharma’s(VRTX_) $9 billion. Vertex’s Hep C drug Incivek wasn’t even approved until May but already there were concerns being raised that Vertex’s reign as king of the Hep C mountain might be short lived.

In this Mailbag, published right after an important European liver disease research meeting, I tried to help readers parse the rapidly changing Hep C treatment landscape:

“It sounds incredibly weird to even conjure this thought, but from Wall Street’s what-have-you-done-for-me-lately perspective, Vertex’s telaprevir and Merck’s boceprevir look a bit old in the tooth even before the two drugs are approved!”

Regarding Vertex, I wrote:

“Vertex’s dilemma is that investors know this story well and have baked much of telaprevir’s potential into the company’s valuation already. What concerns investors today and perhaps even more post-EASL is that the slope of the expected telaprevir revenue tail may be steeper than previously appreciated. Investors are also raising questions about what Vertex is doing to sustain its Hep C franchise in 2015 and beyond when new drugs are expected to enter the market.”

The Mailbag’s crystal ball wasn’t always so prescient. I predicted Orexigen Therapeutics(OREX_) would receive a “good” complete response letter from FDA for its obesity drug Contrave last January. “Good” meant FDA would not require Orexigen to conduct any pre-approval Contrave clinical studies.

Wrong. Not only did FDA reject Contrave, but the agency told Orexigen that the weight-loss drug wouldn’t be approved until the company ran a 10,000 patient heart-safety study.

Advising reader Vince M. last February to be skeptical of micro-cap Radient Pharmaceuticals(RXPC) not only got the Hostile React-o-Meter spinning out of control, but was also the launching point for some of the most entertaining and hard-hitting reporting I published all year.

Biotechs tend to shoot up so much after successful binary events that it may seem like buying them on sales isn’t all that important. But if you can purchase the stock while the pessimism has reached a climax, you can increase your returns if things go well and add in a margin of safety if things don’t go as planned.

I ran a screen for drug companies trading at least 50% below their 52-week high. I eliminated the companies with market caps below $200 million, because most of the stuff on the clearance rack is junk. We’re looking for quality companies on sale.

Here are five I think are worth a closer look.

The failed launch
At least three companies from the screen are there because their drug launches didn’t live up to expectations.

The FDA approved Dendreon‘s (Nasdaq: DNDN  ) prostate-cancer treatment, Provenge, last year, but because the treatment is produced using the patient’s own cells, the company needed to build new manufacturing plants to sell Provenge in mass.

But when the plants were built and the original plant expanded, Dendreon couldn’t hit its goal of full-year revenue of $350 million to $400 million, with half of that coming in the fourth quarter. The company believes this isn’t an issue of demand so much as a payment problem, given the high cost that doctors have to pay and then be reimbursed by insurers and Medicare for.

Human Genome Sciences (Nasdaq: HGSI  ) and GlaxoSmithKline did something that no drugmaker has done in half a century: They got a drug approved specifically to treat lupus. But doctors have been slow to prescribe Benlysta, possibly because lupus isn’t a life-threatening disease. In fact, it’s one of those diseases that waxes and wanes, so only a subset of patients will be complaining about their symptoms at any point.

Avanir Pharmaceuticals‘ (Nasdaq: AVNR  ) Nuedexta is in the same situation as Benlysta. The drug treats pseudobulbar affect, uncontrollable outbursts of crying or laughing that’s a symptom of neurological diseases or injuries to the brain. Although certainly embarrassing and worthy of treatment options, there’s no real urgency to treat pseudobulbar affect. Doctors can prescribe it to a few patients, see how it works, and then increase their prescription rate if they’re satisfied with the drug.

Waiting
Other drug-less biotechs have been knocked down because waiting for their drug launches is apparently too much to ask of short-term-thinking investors.

Exelixis (Nasdaq: EXEL  ) got knocked down after the company said it couldn’t come to an agreement with the FDA over how to test its cancer drug, cabozantinib. The company is proceeding on its own, testing the drug as a treatment for pain in prostate cancer and it’s already posted positive data in medullary thyroid cancer. Yes, the stock is more risky than if the FDA had given Exelixis its blessing on the trial design, but Exelixis still has a solid drug that should be able to improve survival and get approved that way even if the pain indication fails.

MannKind (Nasdaq: MNKD  ) is taking longer to get its inhaled insulin product, Afezza, on the market because the FDA wants to see additional data showing that the devices used in the clinical trials are the same as those that will eventually be marketed. A delay, especially for a company that’s substantially in debt to its founder, isn’t ideal, but I think MannKind should be able to eventually get its device on the market.

Amarin‘s (Nasdaq: AMRN  ) investors have been waiting for a buyout after a pair of successful phase 3 trials for its triglyceride-reducing drug AMR101. Every day that the buyout doesn’t come, investors rightfully get a little more worried that no one is interested in the drug. If you think Amarin can market the drug on its own, the knocked-down price looks more reasonable.

Reality check
I’ve had a bearish CAPScall on Vertex Pharmaceuticals (Nasdaq: VRTX  ) for two years. Incivek clearly works, but it just seemed to me that investors had already priced in sales of the hepatitis C treatment. I wasn’t counting on a drop in the stock — it was more a bet that the company couldn’t keep pace with the overall market — but Vertex has dropped about 27% since I made the call and substantially more from its high set back in May.

The drop seems a little ridiculous considering how well the launch of Incivek is going. It’s true there’s plenty of competition in the hepatitis C space, and early data for drugs in the competitors’ pipelines suggests that Vertex won’t hold its front-runner status for more than a couple of years. But Vertex has other drugs — a cystic fibrosis drug that’s already under review by the FDA — and it’s not going down without a fight in the hepatitis C market.

I’m going to switch my CAPScall on Vertex. I’m not sure whether Vertex has bottomed — that’s a hard call to make — but it’s certainly looking more appetizing at these knocked-down prices

UBS maintains a ‘Neutral’ on Vertex (NASDAQ: VRTX) price target slashes from $47 to $35.

UBS analyst says, “Stock should work after [1] expectations are re-set, and [2] Rx trends drop: Following extensive due diligence at the recent AASLD Liver Meeting, we are retaining our Neutral rating but lowering our PT to $35. We stay Neutral for now, as we think an overhang will persist until Incivek Rx trends peak (1H12e). However, we expect a bull case to emerge at some point in 2012 from Street HCV numbers having come down, resetting expectations, as well as from improved visibility into shareholder-friendly strategies and ahead of data in cystic fibrosis (CF) mid-2012e.”

UBS raises FY11 EPS estimate from $0.50 to $0.54, but lowers FY12 from $4.70 to $4.60.

For an analyst ratings summary and ratings history on Vertex click here. For more ratings news on Vertex click here.

Shares of Vertex closed at $31.98 yesterday, with a 52 week range of $29.24-$58.87.

It’s sad when keeping revenue “about the same” as last year is seen as a healthy situation, but such is the life for the pharmaceutical industry.

Merck (NYSE: MRK ) will see generic competition for its top-selling allergy and asthma drug Singulair next August, so making up for that lost revenue and keeping 2012 revenue equal to this year should be seen as a solid win. Singulair is a $5 billion drug, after all.

Over the next two years, Merck plans to seek Food and Drug Administration approval for eight more medications on top of the five approvals it received this year. The drugs’ treatments run the gamut from chronic insomnia to hardening of the arteries to osteoporosis, and there’s even an improved version of its cervical-cancer vaccine Gardasil. There are also two allergy medicines to replace Singulair. Merck’s investors can thank the timely purchase of Schering-Plough for many of the drugs, including an anesthesia-reversal drug, Bridion, which has been years in the making.

There are no guarantees that the drugs will be approved — this is the FDA, after all — and there’s no guarantees that doctors will prescribe them even if they are approved. Witness Merck’s new hepatitis C drug Victrelis’ inability to compete with Vertex Pharmaceuticals‘ (Nasdaq: VRTX ) Incivek.

But Merck certainly doesn’t look like it’s worried about its ability to create cash flows. For the first time since it lost Vioxx in 2004, Merck raised its dividend. And it wasn’t a token raise, either; the 10.5% increase to $0.42 per quarter gives Merck a dividend yield of 4.7%. That’s juicier than Pfizer (NYSE: PFE ) , Johnson & Johnson (NYSE: JNJ ) , and Bristol-Myers Squibb (NYSE: BMY ) .

You can still get a larger income with Eli Lilly (NYSE: LLY ) , but you’re probably sacrificing growth potential to get it. And remember, this is the pharmaceutical industry, so a lack of growth is actually a decline.

The firm’s late-stage pipeline consists of 32 Phase II and Phase III candidates including new molecular entities and combination programmes for Alzheimer’s disease, diabetes and hepatitis C.

Merck highlighted six novel candidates in various stages of development being evaluated for the treatment of atherosclerosis (anacetrapib), type II diabetes (MK-3102), prevention of herpes zoster (V212), psoriasis (MK-3222), hepatitis C (MK-5172) and Alzheimer’s disease (MK-8931).

In Phase III is the promising new cholesterol treatment, Anacetrapib. The drug is a novel reversible and selective cholesteryl ester transfer protein (CETP) inhibitor, the same class as the ill-fated torcetrapib, which Pfizer had once seen as a potential blockbuster, but abandoned in 2006 after safety problems.

Late stage trials of Pfizer’s drug showed a raised number of ‘all cause mortality’ in trial patients taking the drug, which some signs that it caused raised blood pressure in some patients.  No such problems have been seen with Merck’s candidate, but results from the large Phase III outcomes study REVEAL for the treatment of atherosclerosis, will not be ready until 2015.

Other notable late-stage candidates include osteoporosis treatment odanacatib; insomnia drug suvorexant; and its V503 cervical cancer vaccine.

The firm also confirmed its commitment to the biosimilars units, which makes generic forms of biologic drugs.

The process of developing and gaining approval of biosimilars is far more complicated than producing small molecule generics, but Merck said it would push ahead with a biosimilar version of Amgen’s big selling arthritis drug Enbrel.

Slipping in the league tables

Analysts at EvaluatePharma predict Merck will slip down the pharma league table next year. The company is currently the fourth biggest drugmaker by revenue, but will fall to sixth place next year, with forecast annual growth of just 1 per cent.

This represents a major fall from its highest position of second in 2009, where it was just behind Pfizer for the top spot.

The company is dealing with last year’s patent losses of its two big selling drugs, the hypertension treatments Cozaar and Hyzaar, which together made the company $3.6 billion in 2009.

It will also have to deal with the impending patent loss of its biggest selling asthma drug Singulair that made the firm $5 billion in 2010, which will be exposed to generic erosion in the US next year.

It will be relying on its new potential blockbuster hep C drug Victrelis to help offset its patent losses, but it is in a major competition with J&J and Vertex’s Incivek.

Both drugs were launched this year, but Incivek looks to be pulling ahead already, earning $420 million in sales for its first quarter, whilst Victrelis only brought in $31 million.

EvaluatePharma say that Merck will “struggle to grow its drug business” in the coming years, and does not expect its $41 billion mega-merger with Schering Plough to help its shore up its portfolio in the short-term.

The company also received a knockback from the FDA earlier this week when the regulator asked for more information on its oral contraceptive MK-8175A, and the ophthalmic drug tafluprost.

Roughly 70 percent of people living with HIV and hepatitis C virus (HCV) coinfection have undetectable HCV viral loads after 24 weeks of treatment with either Incivek (telaprevir) or Victrelis (boceprevir) plus pegylated interferon and ribavirin, according to interim results from two studies reported at two recent medical conferences.

Though final proof of the drugs’ effectiveness won’t be known until hepatitis C treatment is stopped and all coinfected people in the trials are followed for an additional six months, rates of undetectable viral loads among those using triple-drug treatment are currently 16 percent to 36 percent above those using only pegylated interferon and ribavirin.

In May 2011, the U.S. Food and Drug Administration (FDA) approved both Vertex Pharmaceuticals’ Incivek and Merck’s Victrelis for HIV-uninfected people living with HCV genotype 1 to use in combination with pegylated interferon and ribavirin. According to studies that contributed to the drugs’ approvals, roughly 70 percent of HCV-positive individuals were sustained virologic responders (SVRs)—cured of their infection—six months after completing treatment.

Approval of the HCV protease inhibitors for people coinfected with HIV and hepatitis C requires successful completion of studies involving this distinct population of individuals, who historically have been significantly less likely to be cured of their hepatitis using longtime standard therapy of pegylated interferon plus ribavirin. Phase II study data are now beginning to trickle in.

Incivek for HIV/HCV Coinfection

Kenneth Sherman, MD, of the University of Cincinnati College of Medicine and his colleagues reported a study at the 62nd annual meeting of the American Association for the Study of Liver Diseases on Monday, November 7, in San Francisco. The study is a two-part Phase II randomized, placebo-controlled trial involving HIV-positive people coinfected with genotype 1 HCV starting hepatitis C treatment for the first time. The study enrolled 62 people, 60 of whom received at least one dose of the study drug and were included in the interim analysis.

People in the first and second part of the study—Part A and Part B—were allotted to receive either 12 weeks of telaprevir or placebo in combination with Pegasys (pegylated interferon) plus ribavirin followed by an additional 36 weeks of Pegasys/ribavirin alone.

Part A enrolled 13 people who were not receiving antiretroviral (ARV) therapy. Part B enrolled 47 people receiving ARV therapy—either Atripla (efavirenz/emtricitabine/tenofovir) or Norvir (ritonavir)–boosted Reyataz (atazanavir) plus Truvada (emtricitabine/tenofovir). It’s important to note that those using Atripla took a higher dose of telaprevir—1,125 milligrams (mg) three times daily instead of the standard 750 mg dose three times a day—because of a known drug interaction between efavirenz and telaprevir.

The interim analysis, reported by Sherman’s team, involved 44 participants who had reached week 24 of treatment. Sixteen people discontinued before week 24 of study treatment, six of whom stopped because of predefined stopping rules.

Eighty-five percent of the study subjects were male, 69 percent were white, and the average age was 45 years old. About 68 percent had HCV genotype 1a—the more difficult of the two HCV genotypes to treat—and most had HCV viral loads in excess of 800,000 copies. Ten percent of the participants had advanced liver fibrosis, as documented with liver biopsies.

The results, detailing treatment responses at 4, 12 and 24 weeks, are summarized in the table below. All time points are important. An undetectable viral load at four weeks, known as a rapid virologic response (RVR), is believed to be highly predictive of an SVR, provided that HCV viral load remains undetectable for the remaining 44 weeks. An undetectable viral load at 12 weeks, known as a complete early virologic response (cEVR), is also valuable; if HCV is still detectable (or hasn’t decreased by at least 2 log) by this time point, an SVR is unlikely. If HCV viral load remains detectable after 24 weeks of therapy, all treatment is discontinued.

CD4 cell counts tended to decrease in all of the study groups, which is a common issue during hepatitis C treatment. However, no HIV viral load rebounds have been documented.

A number of side effects were more common—occurring at least 10 percent more often—among those receiving telaprevir plus pegylated interferon/ribavirin, compared with those receiving pegylated interferon/ribavirin alone. These included itching, headache, nausea, skin rash, fever and depression. Weight loss was more likely to be seen in those using pegylated interferon/ribavirin alone.

Vertex’s planned Phase III study is expected to begin enrollment by the end of 2011. The study will evaluate 24- and 48-week response-guided therapy—using RVR and EVR rates to determine the length of treatment—using Incivek combination therapy in people coinfected with both viruses who are new to treatment for hepatitis C or relapsed after at least one earlier course of therapy with pegylated interferon and ribavirin alone. Participants who had not responded to an earlier course of treatment (partial responders and nulls) will receive 48 total weeks of Incivek-based treatment.

Victrelis for HIV/HCV Coinfection

Twenty-four week data from the Victrelis HIV/HCV coinfection study were reported by Mark Sulkowski, MD, of Johns Hopkins University School of Medicine and his colleagues on October 22 at the 49th annual meeting of the Infectious Disease Society of American (IDSA) in Boston. The study enrolled 100 people with HIV and genotype 1 HCV infection who hadn’t yet been treated for hepatitis C.

As per the approved Victrelis dosing schedule, all study volunteers began therapy with a four-week lead-in period in which pegylated interferon/ribavirin was used alone. From there, about two thirds of the study volunteers received 800 mg of Victrelis three times daily combined with once-weekly Peg-intron (pegylated interferon) injections and twice-daily ribavirin for the study’s remaining 44 weeks. However, participants with detectable HCV viral loads and less than a 2 log viral load decline at treatment week 12, or detectable HCV viral load at treatment week 24, were considered treatment failures, and they discontinued all treatment.

Sixty-nine percent of the study subjects were male, 82 percent were white, and the average age was 43 years old. About 65 percent had HCV genotype 1a, and most of them had HCV viral loads in excess of 800,000 copies. Five percent of the people enrolled had advanced liver fibrosis, as documented with liver biopsies.

All coinfected participants were taking antiretroviral therapy, which was limited to specific Norvir-boosted protease inhibitor-based regimens, because of known drug-drug interactions between Victrelis and various HIV medications.

The results, detailing treatment responses at 4, 8, 12 and 24 weeks, are summarized in the table below.

The most common side effects—with a difference of equal to or greater than 10 percent among those receiving Victrelis plus pegylated interferon/ribavirin, compared with pegylated interferon/ribavirin alone—were low neutrophil counts, bad taste (dysgeusia), vomiting, fevers, headache and decreased appetite. Of note, however, the rate of serious side effects was nearly three times more common among those receiving pegylated interferon/ribavirin alone compared with Victrelis plus pegylated interferon/ribavirin.

In addition to this ongoing Phase II study in coinfected participants new to HCV treatment, Merck is collaborating with the French National Agency for Research on AIDS and Viral Hepatitis (ANRS) on an ongoing Phase II study in people who failed previous HCV treatment. The company also plans to begin a Phase III coinfection study for Victrelis-based combination therapy later this year in collaboration with the federally funded AIDS Clinical Trials Group (ACTG).