2014 Pipeline Report: The Sprint to Value - Pharmaceutical Executive


2014 Pipeline Report: The Sprint to Value

Pharmaceutical Executive

Hepatitis C: Banking on Sofosbuvir

Ben Weintraub, senior principal and director of research at inThought, a division of Symphony Health Solutions, calls his $3 to $4 billion sales estimate on Gilead's sofosbuvir—a nucleoside analog polymerase inhibitor targeting all six HCV genotypes—conservative. "The question is not whether sofosbuvir is going to be the biggest drug for hepatitis C ever, or the biggest drug launch ever...I think everyone agrees that it's going to be both of those things," says Weintraub. "The question is whether it's going to be the biggest drug ever."

Weintraub says he's seen estimates as high as $15 billion, but the reason for his conservatism is the misguided assumption that the population of hepatitis C patients receiving treatment will rise from a current level of 10 percent, to as much as 90 percent once interferon, and it's horrid side effects, are taken out of the picture. Weintraub thinks the percentage of HCV patients receiving treatment will only increase to around 20 percent. The price of therapy is one access-limiting element, but more importantly, says Weintraub, is the fact that a substantial portion of the HCV population won't all of sudden come in to the clinic for sofosbuvir, or any other HCV drug. "If you're an IV drug user, if you're homeless and you have HCV, getting treated for it is not your primary concern," says Weintraub. "Your depression, your alcoholism, your drug abuse, your 12 other diseases, those are the things that doctors might be more worried about taking care of first."

Several analysts including Weintraub say sofosbuvir will receive FDA approval by the end of this year. Sofosbuvir will be prescribed in combination, but Weintraub says it's likely to be priced per regimen, not per drug, at "whatever the market will bear, $70,000 for sofosbuvir, riboviron and a protease inhibitor, whatever that winds up being."

Raghuram Selvaraju, managing director and head of healthcare equity research at Aegis Capital Corp., says Enanta/AbbVie's ABT-450 combo is "every bit as good as sofosbuvir," but isn't getting as much press because the combination regimen will likely be three or four drugs, instead of potentially two with sofosbuvir. Selvaraju says both sofosbuvir and ABT-450 "are very, very good at treating genotype-1 treatment nave patients"—the largest HCV genotype globally, and the hardest to treat—"but they are much less good at treating null responders." After the initial fanfare surrounding sofosbuvir's "marquee drug launch," Selvaraju says the quad ABT-450 regimen "is going to show better activity against null responders with genotype 1 than the sofosbuvir two-drug regimen." Phase III data from two ABT-450 studies are scheduled to read out this quarter, but the product isn't expected to launch until 2015. However, FDA gave ABT-450 Breakthrough Therapy status in May, which doesn't automatically confer an expedited approval, but could possibly tip approval into 2014. On a recent AbbVie earnings call, CEO Rick Gonzalez told investors that ABT-450's interferon-free studies are "coming in April 2014." Scott Brun, AbbVie's head of drug development, dismissed an analyst questions about "pill burden" associated with the ABT-450 regimen, mentioned above by Selvaraju. "Sustained virologic response is king, and we're in the high 90 percent range," said Brun.

Hepatitis C is heating up as these drugs and others compounds get closer to market, but the key late-stage players haven't changed. Recently approved in Japan, J&J's simeprevir is expected to be approved in the United States by this year's end, and BMS's daclatasvir picked up FDA's Breakthrough Therapy designation in April. For more information on these products and others in HCV, see Pharm Exec's 2013 Pipeline Report. Weintraub describes J&J's simeprevir as an Incivek/Victrelis follow-on drug, and says with AbbVie and BMS both launching in late 2014 or 2015, "Gilead looks like it will have a least a year" without meaningful competition. But there's a caveat: the initial sofosbuvir approval includes interferon; the all-oral HCV combo everyone is waiting for won't get approved until 2014.


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