ICN's hepatitis C treatment gets OK // HEALTH CARE: 'Blockbuster' sales are expected for the anti-viral compound.
PENNI CRABTREE: The Orange County Register
12/10/98
The Orange County Register
A breakthrough treatment for hepatitis C that was co-developed by an Orange County firm has been approved for broad use by the U.S. Food and Drug Administration.
The new drug therapy appears to be the best hope for beating back a silent but deadly virus that infects an estimated 4 million Americans. The therapy combines two drugs _ oral doses of ribavirin, developed by Costa Mesa-based ICN Pharmaceuticals Inc., and injections of Intron-A, developed by New Jersey-based Schering Plough Corp.
The FDA approval comes at an opportune time for both drug makers. A new, government-backed effort to educate the public about the quiet killer promises to make hepatitis C the disease poster child of 1999.
And that means ICN and Schering have a blockbuster drug on their hands, according to some Wall Street analysts.
"This will be the mode of therapy, the gold standard," said Eugene Melnitchenko, an analyst with the Los Angeles office of Sutro & Co.
The virus, which wasn't definitively identified until 1989, can lurk undetected for decades. It displays few symptoms even while it hammers the liver, causing chronic liver disease, cirrhosis and liver cancer.
For years, hepatitis C took a back seat to other, more politically prominent and quickly lethal viruses such as HIV. But that is about to change.
In coming months, the U.S. Department of Health and Human Services will require blood banks and hospitals to notify an estimated 300,000 people who likely contracted hepatitis C through transfusions before 1994, when tests were developed to screen for the virus.
Yet transfusions account for only 7 percent of hepatitis C infections. The virus has been transmitted through sexual intercourse or the sharing of needles to millions of others.
Surgeon General David Satcher warned a congressional subcommittee this spring that the virus could reach epidemic levels. It has already infected four times as many people as HIV, the virus that causes AIDS.
Now, with Wednesday's FDA approval, the new drug therapy is almost certain to become the treatment for the majority of infected patients, industry watchers agree.
The treatment, which will be marketed as Rebetron combination therapy, could reach $2 billion in sales by 2002 _ and that's based on a conservative, 2 percent worldwide penetration rate.
ICN, which granted Schering licensing rights to ribavirin in exchange for a hefty royalty agreement, could expect its share to exceed $350 million by 2002, according to Warburg Dillon Read analyst Andrew Forman.
By 2005, ICN's share could hit $1 billion.
For a company whose worldwide revenues totaled $750 million in 1997, the potential hepatitis C windfall is staggering.
"For ICN, this is great news _ it couldn't be better," said Melnitchenko.
The FDA approval adds a happy ending to the convoluted story of ICN and ribavirin _ a tale of regulatory probes, shareholder lawsuits and disappointed hopes.
In the 1980s, the FDA rejected ribavirin for use in treating HIV and AIDS patients, and again in 1994 as a stand-alone treatment for hepatitis C.
ICN Chairman Milan Panic's persistently rosy projections for the drug, coupled with steady FDA rejections, gave ICN's stock a roller-coaster ride and sparked federal probes and shareholder lawsuits.
Terry Souers, a spokesman for ICN, concedes this FDA action is sweet.
"We always had faith in the drug, and we're happy that it is now going to be available to people that it can benefit," said Souers. "There are a lot of them, and it will make a meaningful difference in their lives."
Before the FDA action, the only drugs approved in the United States for widespread treatment of hepatitis C were compounds called alpha interferons, of which Schering-Plough's Intron-A is one.
In most cases, less than 15 percent of hepatitis C patients responded to stand-alone treatments. In 1995, Schering-Plough, intrigued by early clinical data, purchased the licensing rights to ribavirin and began to develop the combination therapy.
In studies of previously treated patients, Rebetron lowered the hepatitis C virus to undetectable levels in 48.6 percent of patients _ compared with only 4.7 percent who had undetectable viral levels after taking Intron-A alone.
In June, the FDA placed the combination therapy on a fast-track review and approved its limited use in treating relapsed hepatitis C patients.
Then another round of studies on previously untreated hepatitis C patients proved to be equally dramatic. Six months after patients completed the therapy, the virus could not be found in the blood of 38 percent getting the combination treatment, compared with 13 percent taking only Intron-A.
The clinical evidence, published recently in the New England Journal of Medicine, all but assured FDA approval, said Robert Consalvo, a spokesman for Schering-Plough.
In a separate FDA action, the agency also approved the first oral treatment for hepatitis B, another liver-destroying virus. Glaxo Wellcome Inc. won the approval. |
