Glaxo Vies for a Second Act in HIV
The drug industry’s response to the HIV epidemic is widely viewed as a story of sterling R&D success. With nearly 30 drugs in five different classes and lifelong three-drug treatment as the standard of care, innovation now centers on developing fixed-dose combinations to minimize dosing requirements and the risk of HIV mutations as well as drugs that are less toxic. Given this primacy of combinations, it’s apt that GlaxoSmithKline and Pfizer are doing a little combining of their own—by spinning off their separate HIV portfolios and pipelines into a single independent entity.
Called ViiV Healthcare, the subsidiary aims to catch entrepreneurial fire by operating like any other struggling biotech bankrolled entirely by its own portfolio. First year sales are projected to be $2.4 billion. The terms of the deal reflect the relative valuations of each firm’s HIV assets, with Glaxo at 85 percent equity and Pfizer at 15 percent. In fact, this so-called joint venture looks more like a Glaxo experiment in business development. ViiV CEO Dominique Limet is the former head of personalized medicine at the British firm, while eight of the nine members of the ViiV executive team are also Glaxo alums. Cynics have noted that Pfizer may have been only too happy to unload its lone HIV drug, Selzentry, on Glaxo, whose globe-trotting commercial HIV operation can handle the well-intentioned but star-crossed product.
In two press teleconferences held on Tuesday to announce the launch, Limet spoke in passionate if grandiose terms of ViiV's mission. Calling it “a radical approach” that is “100 percent committed to finding better HIV treatments,” Limet noted the disturbing trend among a growing number of patients who, after years and even decades on HIV treatment, get hit with what appear to be symptoms of accelerated aging, including cognitive impairment, bone loss, and renal problems. He said, “Much of our historic effort has been led by the science, but we must now understand the broader and deeper needs of people with HIV.”
Analysts and advocates alike have criticized Glaxo for failing at that very task. Once the top dog in HIV, the British firm was left in the dust over the past decade by more collaborative R&D shops—most notably San Francisco biotech Gilead Sciences, which seemingly came out of nowhere with a string of powerhouse drugs and now boasts 31 percent of the market compared to ViiV’s 19 percent. Gilead is known for its close ties to AIDS activists, and after considerable pressure, the biotech teamed up with competitor Bristol-Myers Squibb to create the ultimate patient-friendly product: the first triple-drug cocktail in a once-daily single pill. The one-a-day Atripla fast became the market leader.
Said Limet: "Our intent is to look at what we can do with the portfolio we get from Pfizer and Glaxo to build new combinations which will completely transform the way we treat HIV.”
Yet a quick read of the two portfolios doesn’t necessarily reveal a transformative result. The British drug giant brings nine products to the table, most of which are single agents whose patents run out in the next few years. Pfizer, for its part, has only Selzentry, a first-in-class CCR5 antagonist whose blockbuster dreams were dashed when researchers discovered that fewer than half of treatment-experienced patients even have CCR5-tropic viral strains. A diagnostic assay is required for confirmation before taking the drug.
"Selzentry will be a key driver and lever for our growth," Limet said. “It will allow us to maintain our competitiveness and stabilize, hopefully, over time our market share in front of Gilead.”
Relying on Selzentry to float the boat may prove tricky, since Pfizer reported a mere $46 million in 2008 sales—despite a rapid price hike making it the most expensive HIV drug on the market. Selzentry's fortunes should improve, however, thanks to an anticipated FDA nod for use in treatment-naïve patients, among whom CCR5-tropic virus is common.
Still, what's not to love about a new R&D machine devoted exclusively to HIV? Analysts have generally heaped praise on ViiV. The In Vivo Blog crowned it deal of the year when it was first announced in April. UBS’s Ubola Amusa went further, telling the Financial Times, “This could well go down as one of the most innovative and important deals in pharma in the past 10 years. This is an out-of-the-box way to handle industry’s biggest issue: excess capacity.”
Activists gave it their own tight-lipped approval. David Evans, co-chair of the AIDS Treatment Activists Coalition's Drug Development Committee, said, "We’re hopeful that the joining of the two companies’ HIV portfolios will result in innovative HIV drugs. There have been concerns that HIV had fallen off the priority list at the larger pharmaceutical companies, but this seems to be a creative solution that could pay off in the long run.”
Datamonitor’s Mansi Shah cast a colder eye on the deal. “Glaxo needed to bolster its pipeline after a series of late-stage failures, and its portfolio is very old. Pfizer has a few new young compounds in development,” she said. “Either way, any new drug they develop will be difficult to establish without being a co-formulation.”
ViiV Healthcare’s pipeline features five antiretrovirals in Phase II and one in Phase I, a spread of non-nukes, integrase inhibitors, and CCR5 antagonists. According to Shah, the most promising is Glaxo’s integrase blocker, which has shown “impressive” efficacy; if it pans out, it could give Merck’s first-in-class Isentress a run for its money. Limet also noted that one compound in the pipeline may have immune-stimulating effects.
In the absence of any truly transformative approach to HIV—not to mention a cure—drug combinations will remain the key to meeting patient needs. And the competition is only intensifying. Gilead expects to launch two triple-combo, one-a-day pills over the next few years, one in collaboration with fellow biotech Tibotec. ViiV’s best strategy may be to focus on developing a franchise of nucleoside-sparing fixed-dose options or something a little wild and crazy like bundling its protease inhibitor, Lexiva, with an integrase inhibitor.
Yet if Limet is to achieve his stated mission to revolutionize HIV treatment, he will undoubtedly have to start drilling in pipelines other than those at Glaxo and Pfizer. ViiV has right of first refusal of any HIV compound that reaches proof of concept at either parent company. But whether or not the parents will look favorably on ViiV's doing deals with cutting-edge biotechs, let alone the established competition, remains to be seen. Limet says he can. That would be the true test of ViiV's independence—and of Glaxo's decision to finally play well with others.
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