AASLD Preview of company presenters from GS (good summary of clinical status of candidates to treat hepatitis B and C):
The American Association for the Study of Liver Disease (AASLD) will hold its Annual Meeting in San
Francisco from November 11 – 15. Data to be presented include: (1) Phase II data for SCG 503034
(SGP) (2) Phase IB for VX-950 (VRTX) (3) Phase II data for Valopicitabine (NM283, IDIX) (4) Phase III
data on Telbivudine (IDIX, NOVN.VX) versus Lamivudine at weeks 52 & 76 (5) Phase II data for Albuferon (HGSI) (6) 5-year efficacy data for Hepsera (GILD). We maintain our ratings for GILD (OP/N),IDIX (OP/N), NOVN.NX (OP/A), ROG.VX (OP/A), HGSI (IL/N), VRTX (U/N) and SGP (U/N).
KEY PRESENTATIONS:
1) Anti-viral activity of SCH 503034, a HCV protease inhibitor, administered as monotherapy in
hepatitis C genotype-1 patients refractory to pegylated interferon Trial establishes Schering-Plough's first-in-class protease inhibitor for hepatitis C virus (HCV), as a
follow-on to PEG-Intron and Rebetol, and competition for Vertex's VX-950 and Idenix's valopcitabine.
Schering-Plough places high value on the product in its pipeline, as potentially over >$1 Billion in peak
sales. Though the monotherapy data is presented, the product will be positioned as an adjunctive therapy in HCV.
2) Final Results of a Phase 1B, multiple-dose study of VX-950, a hepatitis C virus proteaseminhibitormFinal results will provide greater detail into Vertex’s potential first-in-class product for HCV. Top-linemdata showing 2-4 log reductions in 34 patients at two weeks were announced in Q2 2005.m
3) Randomized trial of Valopicitabine (NM283), alone or with Peg-Interferon, vs. re-treatmentmwith Peg-Interferon plus Ribavirin (PegIFN/RBV) in hepatitis C patients with previous nonresponsemto PegIFN/RBV: first interim resultsmInterim data forms basis for potential Novartis opt-in. Week 12 data (new) at the meeting. HCV is biggerm($1.5B) opportunity.
4) Telbivudine (LdT) vs. Lamivudine for Chronic Hepatitis B: first-year results from theminternational Phase III GLOBE trialmPivotal 1-yr data upon which regulatory filing is based; longer-term, 18-month data available at meeting.
Hepatitis B virus (HBV) is smaller ($0.5B) opportunity.
I. HEPATITIS C – MULTIPLE PRODUCTS IN THE PIPELINE
1) VX-950 (VERTEX) – FULL RESULTS FROM PHASE IB EXPECTED
VX-950 inhibits hepatitis C protease, a potential first-in-class target for HCV. In 2Q05, Vertex nnounced positive top-line Phase 1B data for a study that involved 34 patients being treated for 14 days with one of three doses of VX-950. VX-950 showed strong antiviral activity in the studies (2 – 4.4 log reductions) and was well tolerated. The median reduction in HCV RNA was greater than 3 log10. Doses tested included 450 mg every 8 hours, 1250 mg every 12 hours or 750 mg every 8 hours. VX- 950 was administered as an oral suspension in this study. The biggest reduction in viral load was observed in the 750 mg every 8 hour arm, with a median reduction of 4.4 log10 at day 14. Full data from this study will be presented at AASLD. We believe this early data is encouraging from an efficacy perspective. However, this is a small, short study. Key items to address next would
include: (i) Longer-term efficacy and safety in a larger patient population (treatment-experienced and naïve) (ii) monotherapy and combination studies (iii) development of final formulation (assessment of pill burden) (iv) resistance data and (v) regulatory development pathway (treatment duration, follow-up, target dose with pill).
2) ALBUFERON (HUMAN GENOME SCIENCES) – IMPROVEMENT ON PEG-INTRON Albuferon, a long-acting, potentially less toxic form of alpha interferon, may have potential efficacy and/or dosing advantages relative to pegylated alpha interferon. Data generated to date suggest the potential for 2-4 week dosing, versus the once-weekly dosing more typical of
pegylated alpha interferon therapy; Albuferon has a half-life of 80 hours and PEG-Intron of 40 hours. Furthermore, early clinical data suggest that Albuferon may potentially have greater efficacy, with a lower side effect profile. Early phase II data must be borne out in larger studies. A Phase II study of Albuferon plus ribavirin in HCV Type I patients who have failed prior alpha interferon therapy is underway. This study includes up to 100 patients in the U.S. There will be 3-4 dose groups and Albuferon will be dosed subcutaneously every 14 or 28 days for 48 weeks, with a 24-week follow-up period. Safety data from this study is expected at AASLD.
3) VALOPICITABINE (NM283 – IDENIX): ENCOURAGING PRELIMINARY PHASE IIB DATA IN REFRACTORY HEPATITIS C At AASLD, we expect to see detailed 12-week data from the Phase IIb study of oral Valopicitabine (NM283) in 173 patients with refractory
hepatitis C virus (HCV) infection. Four-week data on 97 patients was released in 10/05 and Idenix management reviewed partial 12-week data at this time. Based on this information, we expect the 12-week results at AASLD to be encouraging. The trial evaluates HCV genotype 1 patients who have previously failed at least 3 months of Pegasys (pegylated interferon alfa-2a from Roche) plus ribavirin and have baseline
HCV RNA = 100,000 IU/mL and compensated liver disease. Patients were randomized to 5 treatment arms: (1) NM283 monotherapy (800mg/d); (2) NM283 400mg/d + Pegasys; (3) NM283 400à800mg/d ascending dose + Pegasys; (4) NM283 800mg/d + Pegasys; (5)Pegasys + Ribavirin re-treatment. Pegasys was given at 180µg subcutaneously weekly and the dose of ribavirin was 1000-1200 mg orally every day. At 4 weeks, the reduction of HCV RNA was significantly greater in the NM283 + Pegasys combination arms relative to Pegasys + Ribavirin (control group). There appeared to be a dose-response effect of NM283 in the three NM283 combination arms. The efficacy of
NM283 monotherapy was modest, suggesting that it should be used as part of a drug “cocktail,” perhaps including pegylated interferon and /or other agents, such as HCV protease inhibitors (e.g., Gilead’s GS 9132). Data at 24 weeks of therapy are expected in Q1/06. Idenix plans to schedule an end of Phase IIb meeting with the FDA in 11/05 and start a Phase III trial by Q1/06. Novartis has 90 days (Q1/06) after the FDA meeting to decide whether to opt into the program. If it does, total payment to Idenix could exceed $0.5B. Previous Phase IIa data on NM283 in treatment naïve patients (NM283 +/- IFN) have been preliminarily encouraging (See our 7/28/05 note for details). Based on positive findings in the Phase IIa study, Idenix initiated another Phase IIb study in more than 175 treatment-naïve
patients in Q2/05. The study has 5 treatment arms involving various dosing regimens of NM283 plus Pegasys. The goal is to define a combination with the best risk-benefit.
Additionally, Novartis has an exclusive right to in-license NMC283 from Idenix prior to phase III.
4) SCH 503034-SGP: HCV Protease inhibitors offer great promise in the treatment of Hepatitis C HCV Protease inhibitors specifically target the HCV virus, unlike pegylated interferons and ribavirins which operate through more general anti-viral and immunomodulating mechanisms. The possibility of drug resistance is a concern as the first class of drugs increases the likelihood that protease inhibitors will be used in combination with interferons.
At this year’s AASLD Liver Meeting, Schering-Plough will be presenting monotherapy data from a multi-dose, double-blind study. HCV-1 patients who failed peg-interferon alpha were split into groups 3:1 randomly to receive placebo, 100 mg, 200 mg, 400 mg, all twice daily, and 400 mg three times daily, for 14 days. Data showed rapid absorption (mean Tmax = 1-2 hrs), and dose-response within 24 hrs of the first
dose. Though the trial was not designed for efficacy, it does report a mean max viral load reduction in the 400 mg three times daily group of 2.06 log10 from baseline. Elevated liver enzymes were found also to be correlated with dose.
Schering-Plough has planned a Phase II study that will examine the safety and efficacy of their protease inhibitor in combination with Peg-
ntron, with and without ribavirin, in patients that have already failed initial combination therapy with Peg-Intron and ribavirin. The Phase II study is a blinded, placebo-controlled study of 300 HCV non-responder patients to PEG-interferon and ribavirin. The study should demonstrate dose response in combination therapy of the 100, 200 and 400 TID dosing, and should show the efficacy of the combination
therapy against placebo substituted for Rebetol, and will go for up to 48 weeks. Schering-Plough is planning additional studies in HCV 1 treatment naïve patients, and special populations including African-American, HCV/HIV co-infected, and Liver/renal transplant patients. chering-Plough expects launch in 2009/2010, with peak sales of >$1B. We expect launch in 2009+, and peak sales of $750mm.
MARKET OVERVIEW
Chronic Hepatitis C Virus (HCV) affects 170 million people worldwide, with 3-4 million new cases and over 1 million deaths each year. HCV is under-treated, due to the relatively poor safety and efficacy of standard-of-care therapies. There is currently no vaccine for HCV. Current treatment options include immunomodulators such as PEG-Intron and Pegasys. Nucleoside/nucleotide analogs such as Valopicitabine
(Idenix) and Viramidine (Valeant), and HCV protease inhibitors such as VX-950 (Vertex) and SCH 503034 are still in clinical trials. The market is expected to grow to about $4 billion in 2007.
II. HEPATITIS B – WE EXPECT GRADUAL MARKET EXPANSION WITH NEW ENTRANTS
1) TELBIVUDINE (IDENIX, NOVARTIS) – EXPECT SOLID TELBIVUDINE DATA AT 1 YEAR. FDA FILING ON TRACK FOR LATE 2005 Data at 52 weeks were released in 10/05 from the Phase III GLOBE study comparing Telbivudine (LdT) versus the standard of care,
Lamivudine (GlaxoSmithKline) in chronic hepatitis B (HBV). The results, which were discussed on a conference call by Idenix management,showed that Telbivudine was potent in reducing HBV and was relatively well tolerated. It was previously reported (7/05) that Telbivudine had
achieved the primary efficacy endpoint at 52 weeks of “Therapeutic Response”, defined as: (1) viral load < 100,000 copies/ml and (2) either normalization of ALT, a liver enzyme, or loss of hepatitis B e-antigen (HBeAg).
We anticipate that the full 52-week dataset, 72-week results, and histology findings will be presented at AASLD. The data should demonstrate that Telbivudine, relative to Lamivudine, had greater antiviral activity and lower rates of viral resistance and primary treatment failure. Two-year data is expected H2/06. Efficacy of Telbivudine at 2 years in treatment-naïve patients was demonstrated in a prior Phase II
study. On the 10/05 conference call, Idenix management also reviewed a separate analysis of the GLOBE trial that demonstrated a correlation between efficacy at one year and viral load at 6 months: high HBV DNA levels at 6 months corresponded to low efficacy at 1 year. Details of this analysis, including results by treatment (Telbivudine vs. Lamivudine), should be released at the AASLD meeting.
Idenix expects to file an FDA application on Telbivudine based on 1 year data by the end of 2005. Its partner, Novartis, plans to submit applications to major countries in Europe and Asia in Q1/06. Assuming FDA approval, we nticipate peak sales of Telbivudine to exceed $0.5B worldwide, with less than $100MM in the U.S. Idenix and Novartis will share profits in the U.S. and Europe (50/50 in the U.S. at launch,
and up to 50% to Idenix by year 3 of launch in the E.U.). For the rest of the world, Novartis will market the products and pay Idenix a transfer price.
2) HEPSERA (GILEAD) – LONG-TERM SAFETY & EFFICACY DATA
Hepsera (Adefovir dipivoxil) is currently the leading hepatitis B anti-viral agent, accounting for over 55% of prescriptions in the U.S. It is an oral nucleotide analog that blocks the enzyme HBV polymerase, which is necessary for viral replication. Hepsera is differentiated from
available treatments by a favorable resistance profile (estimated to approximate 3-4% at 144 weeks) and solid efficacy in lamivudine-resistant patients.
a) Five-year safety and efficacy data: Results from the ongoing study 438 evaluating long-term safety, efficacy and tolerability, are expected at AASLD. 185 patients were randomized in a 2:1 ratio to receive Hepsera or placebo once daily for 48 weeks. At week 48, patients receiving
Hepsera were randomized to receive either an additional 48 weeks of Hepsera (n=80) or placebo (n=60). Patients who initially received placebo were switched to Hepsera.
Safety and efficacy data at 144 weeks were released in June 2005. Among patients treated with Hepsera, 79% had undetectable levels of serum HBV DNA at week 144. The most common adverse events reported were headache, abdominal pain and pharyngitis.
b) Resistance studies: Data from studies evaluating the emergence of resistant mutations will be presented. Two mutations in the HBV polymerase enzyme have been associated with resistance to Hepsera. c) Hepsera in liver transplant patients: Results from a study evaluating virological response and resistance to Hepsera in liver transplant
patients will be presented. Given that interferon therapy, which is typically used as front-line therapy, is least useful in patients in whom Alanine Aminotransferase (ALT) levels are low and viral loads high, nucleoside/nucleotide analogs such as Hepsera could be used instead in
such patient populations.
3) TENOFOVIR (GILEAD) – COMBINATION STUDIES WITH HEPSERA
Gilead initiated Phase III studies comparing Tenofovir, its antiretroviral agent for the treatment of HIV infection (Viread), to Hepsera, in July 2005. Data on co-infected HIV/HBV patients treated with both agents will be presented. Tenofovir has shown strong antiviral activity in patients co-infected with HIV and HBV, enables higher dosing and may be more potent than Hepsera in this setting. Tenofovir would also be approximately $100 cheaper than Hepsera on a monthly basis, given current prices.
4) PEGASYS (ROCHE) – REPEAT TRIAL DATA EXPECTED
We expect multiple data presentations for Roche's Pegasys (peginterferon alpha-2a) in both Hepatitis B and Hepatitis C at AASLD. In particular, we would highlight presentation of the first data from an interim analysis of the REPEAT study in Hepatitis C. We believe one of the key issues in the Hepatitis C market is expansion. Patients are typically treated for short periods of time and there are few options for those who fail prior interferon therapy (estimated at around 50%). If positive, we believe the REPEAT trial could provide an important additional source of market growth.
REPEAT is designed to evaluate efficacy of Pegasys, in combination with Copegus, in patients who have failed to respond to previous therapy with another interferon (peginterferon-alpha 2b) in combination with Copegus. REPEAT is expected to recruit >1,000 patients and will also evaluate long-term safety and efficacy of the combination in this patient group over a 72-week period. We expect to see initial results at AASLD but do not expect full data to report until 2007. Roche's Pegasys/Copegus franchise is a key component of Roche prescription products (Roche Rx; Genentech has no rights). We estimate sales of SFr1,750mn in 2005E which represents 11% of 2005E Roche Rx sales and 7% of total pharma sales.
MARKET OVERVIEW
Chronic Hepatitis B Virus (HBV) affects 350 million people worldwide, with 2-3 million new cases diagnosed and 1.3 million deaths each year. Around 25-40% of patients will ultimately die of cirrhosis with or without hepatocellular carcinoma; the death rate is 50% for males and 15%
for females. The disease is under-diagnosed and under-treated, despite the availability of vaccines, due to low awareness and formerly limited, sub-optimal therapies. The launch of Hepsera (Gilead/GlaxoSmithKline) in 2002, of Baraclude (Bristol Myers Squibb) in April 2005 and potentially of new therapies currently in clinical trials, including Telbivudine (Idenix), should expand the market to over $1 billion by 2007. In patients affected by HBV, liver disease is typically caused by the fluctuating immune response to the virus1. As a result, standard-of-care
therapies include both:(i) immunomodulators such as PEG-Intron (Schering-Plough) and Pegasys (Roche) and (ii) nucleoside/nucleotide analogues, which have a
more direct antiviral effect and which include Lamivudine (GlaxoSmithKline), Hepsera (Gilead), Pradefovir (Valeant) and Baraclude (Bristol-Myers Squibb). The ultimate goal of treatment is to achieve sustained suppression of HBV replication to below 105 copies/mL for patients
positive for hepatitis B e antigen (HBeAg) and to even lower levels for HBeAg-negative patients.
Each of the analysts named below hereby certifies that,>>
quid |
