Merck Seen As Late-Riser In HCV Combo Race, As Some Competitors Fade

Gilead is still viewed as clear leader to get first all-oral combo to the U.S. market for chronic hepatitis C. Heading into this year’s AASLD conference, AbbVie and Bristol, along with Merck, are also working to get combos to market to take at least a piece of the mega-blockbuster market for next-generation HCV therapies.

Heading into the American Association for the Study of Liver Diseases annual meeting, the conventional wisdom about the hepatitis C arms race remained largely in place. Gilead Sciences Inc. would be first to market in the U.S. with a combination of oral, direct-acting antiviral (DAA) drugs for HCV and take a significant market share, while several other firms would look to find niches for their own DAA combo regimens.

As of now, the main competitors to Gilead are AbbVie Inc. and Bristol-Myers Squibb Co., according to analyst Brian Skorney of Baird Equity Research (Also see "Gilead Maintaining Lead Position In Hepatitis C, While Idenix Is Starting Over" - Pink Sheet, 11 Feb, 2013.). But the biggest change shortly before the Liver Meeting, slated for Nov. 1-5 in Washington, D.C., has been the re-emergence of Merck & Co. Inc., which obtained breakthrough therapy designation from FDA for its two-drug combo – protease inhibitor MK-5172 and NS5A inhibitor MK-8742 – which demonstrated eye-opening treatment-effect data at four weeks in a Phase IIb trial.

The other three leaders in the HCV oral combo race already had gotten breakthrough designations, which can shorten clinical development timelines – Gilead for its nucleoside polymerase inhibitor sofosbuvir (GS-7977), AbbVie for its combination of protease inhibitor ABT-450 and NS5A inhibitor ABT-267, and Bristol for its NS5A inhibitor daclatasvir (BMS-790052). Merck, which got the first protease inhibitor, Victrelis (boceprevir) approved for HCV in 2011 but quickly lost significant market share to Vertex Pharmaceuticals Inc.’s protease inhibitor Incivek (telaprevir), was not seen as a major player in the next-paradigm competition, but may have edged its way back in with its promising interim data.

Direct-Acting Antivirals At A Glance

There are three main classes of DAA agents in development to treat chronic HCV:

• Protease inhibitors: inhibitors of NS3/4A protease, an enzyme that processes viral polyproteins into functional proteins
• Polymerase inhibitors: inhibitors of NS5B polymerase, an enzyme that synthesizes hepatitis C RNA using an RNA template (This class divides further into nucleosides, which are pan-genotypic and offer strong resistance profiles, and non-nucleosides, which are genotype-specific and not as strong against resistance.)
• NS5A inhibitors: inhibitors of a multi-functional protein that plays a central role in viral replication

Source: Leerink Swann Healthcare Equity Research note “The Future of Hepatitis C,” Feb. 5, 2013

“I certainly think they’re at least on par with the regimens AbbVie and Bristol have,” Skorney said in an interview. “I think it’s totally up in the air how close they get to Gilead.”

Four-week data from the trial testing Merck’s ‘5172 and ‘8742, both with and without ribavirin, in treatment-naïve, genotype 1 patients showed an on-treatment response rate of 100%. At AASLD, Merck will present data showing how those patients fared through 12 weeks of treatment – unrecognizable viral load at 12 weeks would amount to sustained virologic response (SVR), which is considered a cure.

In an Oct. 1 note, Skorney pointed out that the 100% treatment response occurred over three dosing regimens encompassing patients with both genotype 1a and genotype 1b of the virus. Genotype 1 is most common form of the virus in the Western world, with the two subtypes presenting different treatment challenges. Genotype 1b is the predominant strain in Japan, where Bristol is expected to be first to market with a proprietary oral combo of daclatasvir and protease inhibitor asunaprevir (Also see "J&J Hoping To Position Simeprevir As Top Next-Gen Protease Inhibitor For HCV" - Pink Sheet, 22 May, 2013.).

Merck’s Trial Expansion Suggests Positive Data

The 100% treatment response has continued through eight weeks, with no viral breakthroughs, since Merck filed its AASLD abstract for the Phase IIb trial. A recent decision by the pharma to add patients, increasing the total number of participants to 450 from an initial 48, and test a shorter treatment period of eight weeks indicates the findings are continuing to be positive, the analyst asserted. Many of the new arms also don’t include ribavirin in their regimen.

“It’s unlikely they’d go from a 12-week duration to an eight-week duration if they weren’t seeing high SVR rates at 12 weeks,” Skorney told “The Pink Sheet”. “I would take that as a fairly bullish read that Merck is there.”

“It’s just been a massively increased study,” he continued. “You can increase the trial size, but if you’re increasing the size to look at 16 weeks of therapy with four agents, that’s a different signal, right? That means that your two-agent regimen at 12 weeks didn’t work, so you’re expanding to see if more agents over more weeks will work. This is shortening the duration of treatment and reducing the number of agents; you only do that if you’re having success.”

According to an Oct. 3 note by ISI Group analyst Mark Schoenebaum, Merck added 13 arms to the study and also is testing the two drugs in null responders, patients with cirrhosis and patients co-infected with HIV. Merck soon may have data to put its two-drug combo in a position advantageous to other combinations of protease and NS5A inhibitors. Besides the AbbVie and Bristol combinations encompassing those classes, Janssen’s protease inhibitor is being tested with Bristol’s daclatasvir, as well as with an Idenix Pharmaceuticals Inc. Phase II candidate (IDX719), Schoenebaum noted.

Now A Four-Way Race
Gilead, AbbVie, Bristol-Myers Squibb and Merck generally are viewed as the leading candidates to successfully bring a combination regimen of oral DAAs to market for chronic hepatitis C. These are each company’s primary candidates:
Sponsor	Protease inhibitor	Polymerase inhibitor	NS5A inhibitor	Development/Regulatory Status
Gilead Sciences		Sofosbuvir (nuc)	Ledipasvir	Sofosbuvir has Dec. 8 PDUFA date; two-drug combo slated for filling in 2Q14
AbbVie	ABT-450 (boosted with ritonavir)	ABT-333 (non-nuc)	ABT-267	NDAs for all three planned for 2Q14
Bristol-Myers Squibb	Asunaprevir		Daclatasvir	Combo to be filed for approval in Japan in 4Q13
Merck & Co.	MK-5172		MK-8472	Currently in Phase IIb combination trial
Source: Company press releases, earnings calls and analyst notes.

In his Oct. 1 note, Baird’s Skorney said continuation of the data points seen early in Merck’s Phase IIb trial would establish a significant threat to AbbVie and possibly even Gilead. “We believe this combo has the potential to be a significant player in the treatment paradigm,” he wrote. “This data creates the greatest risk for AbbVie, given the mechanistic comparability (PI + NS5A), but also presents a new risk to Gilead, as it appears safe, effective and convenient. It is probably three to four years behind Gilead’s all-oral (regimen) in genotype 1, but should still be kept on the investor radar.”

Gilead’s sofosbuvir and Janssen Pharmaceuticals Inc.’s simeprevir both just received endorsements from FDA’s Antiviral Drugs Advisory Committee . Each compound is expected to obtain routine approval from the agency by its respective PDUFA date, Dec. 8 for sofosbuvir and Nov. 28 for simeprevir .

Bristol To Focus On Japan

During its third quarter earnings call on Oct. 22, Bristol outlined its strategy, which is to get approval and launch its two-drug combo in Japan for the genotype 1b population. If it succeeds, Bristol would be the first company to market with an all-oral DAA combo, but limited to that specific market and population.

“We plan to file in Japan later this quarter,” CFO Charles Bancroft said during the call. “Remember, there are about 1.2 million people infected with hepatitis C in Japan and about 70% of them have genotype 1b. These patients are largely elderly and many either cannot tolerate the current interferon-based standard of care or are ineligible to receive it. So, that speaks to the real opportunity and why the current standard of care [pegylated interferon, ribavirin and either Incivek or Victrelis] has not done well.”

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Gilead, meanwhile, is investigating the potential of sofosbuvir, the “nuc” acquired in its record-setting buyout of Pharmasset Inc. in 2011, in various ways. One is in HCV patients awaiting a liver transplant. The specialty firm is slated to present data testing sofosbuvir with ribavirin dosed over 48 weeks in this population at AASLD. Protease inhibitors are not used in this patient cohort because of the complications that can result due to how they metabolize in the liver. FDA signaled in its briefing documents for the advisory committee review that it was ready to approve the liver transplant claim.

In its VALENCE trial, Gilead is testing sofosbuvir and ribavirin over a 24-week course of therapy in genotype 3 patients, after 12- and 16-week regimens produced disappointing results. Twelve weeks has proven sufficient for that combo to produce strong SVR rates in the genotype 2 population, so genotype 3 remains one of the few hurdles still facing sofosbuvir, Leerink Swann analyst Howard Liang noted in an Oct. 7 analysis.

Poor results with the 24-week regimen probably would mean that a second DAA agent, possibly the NS5A inhibitor ledipasvir, would need to be added for genotype 3 therapy, he wrote. “Even if the 24-week results are substantially better, it remains to be seen if the addition of another agent to the combination could shorten the duration and if that would be a cost-effective strategy,” Liang said. “Another option at the time of approval of sofosbuvir would be 12 weeks of [sofosbuvir dosed with peg-interferon and ribavirin] for genotype 3 patients as [proposed in the NDA] for genotype 1/4/5/6 patients.”

Gilead Likely Can Go It Alone

Even if it does not get great data in genotype 3, Baird’s Skorney believes Gilead has no need to go shopping for a new asset among the dozens of DAAs in clinical development at other companies. In addition to sofosbuvir and ledipasvir, Gilead also has a protease inhibitor, GS-9451, and a non-nucleoside polymerase inhibitor, GS-9190, in development, although neither of those is a front-burner project.

While Gilead agreed to combination testing of sofosbuvir with Bristol’s NS5A inhibitor daclatasvir, Skorney said the California virology specialist has no need to sign a partnership with Bristol to use that drug in a combination regimen. “At this point, I think that would be a foolish decision for Gilead,” he said. “Ledipasvir is every bit as good as daclatasvir. I don’t think there’s any real differentiation between ledipasvir and daclatasvir.”

On the flip side, he added, Bristol probably would relish the chance to partner with Gilead in HCV. Such a collaboration potentially could reprise the success of the two companies’ HIV partnership, in which Bristol’s Sustiva (efavirenz) has been combined with Gilead’s Viread (tenofovir) and Emtriva (emtricitabine) to produce the blockbuster Atripla pill.

Daclatasvir simply has not established itself, on the basis of efficacy or ability to overcome resistance issues, as a potential backbone therapy for HCV, a status Skorney ascribes only to sofosbuvir and AbbVie’s protease inhibitor, ABT-450, which gets around resistance by being boosted with ritonavir. Further, the analyst asserts that no NS5A inhibitor shapes up as a backbone therapy, largely commoditizing that class of agent.

“Sofosbuvir is a really unique agent in this whole context – there are drugs that are backbones of [HCV] therapy and drugs that are complements, and I would say sofosbuvir is far and away the clearest backbone drug,” Skorney said. “ABT-450, I think, is a backbone drug, but to a much lesser extent. Everything else essentially is just a complement. [No others] have shown the capability at this point to evade the resistance mechanisms of the hepatitis C virus so effectively. Merck, I think, is the closest to demonstrating that with its own drugs.”

Merck’s late emergence makes for a four-company competition in the DAA combo space, he said. Beyond Gilead, AbbVie, Bristol and Merck, no other company is particularly relevant at this point. Janssen can expect an FDA approval for simeprevir next month, but Skorney sees almost no market potential for the protease inhibitor, even though it is taken once-daily, while Incivek and Victrelis must be dosed three-times-daily.

“Gilead is about to get approved for 12-week therapy with no safety concerns and a 90% SVR rate,” he explained. “Simeprevir will be a 24-week regimen with a 75% SVR rate and safety concerns. It’s just so black and white. The only way I could anticipate any use [for simeprevir], and I don’t, is through some sort of extraordinary pricing discounts to capture some market share. My assumption is that Incivek, Victrelis and simeprevir, on the day sofosbuvir gets approved, will essentially be non-starters. I just don’t know who would buy them.”