Gilead's HCV Combination Therapy Data Looks Promising - Analyst Blog

Gilead Sciences GILD announced encouraging top-line results from a phase III study (GS-US-337-0113: n=341) on a fixed-dose (all-oral) combination of ledipasvir (NS5A inhibitor) and Sovaldi (with or without ribavirin) in Japan for treating patients with chronic HCV genotype 1 infection.

Gilead evaluated the combination therapy in treatment-naïve (n=166) as well as treatment-experienced (n=175) patients in the 12-week study. Gilead stated in its press release that of the total HCV patients evaluated in the study, 76 had compensated cirrhosis.

Data revealed the entire cohort of treatment-naïve (n=83) and treatment-experienced (n=88) patients achieved a sustained virologic response 12 weeks after the completion of treatment (SVR12) by the all oral combination (without ribavirin). Patients achieving SVR12 are considered to be cured of the dreaded virus.

Results were also encouraging in patients receiving ribavirin plus the combination therapy for 12 weeks in both the treatment-experienced (100% SVR12) and treatment-naïve (96% SVR12) arms. Data from the phase III study showed that SVR12 was achieved by 75 HCV patients (across all arms) with compensated cirrhosis. Gilead said that the phase III study met its primary endpoint of superiority compared to a predefined historical SVR 12 rate.

We are positive on the encouraging data on the combination therapy in Japan as genotype 1 chronic HCV infection is the most common HCV strain found in the country. Consequently, a Japanese approval (expected to be sought by Dec 31, 2014) for the combination in the above population would boost Gilead's top line significantly. The cocktail therapy is under review in the U.S. and EU for treating HCV patients with genotype 1 version of the virus.

Sovaldi, as a monotherapy, is already available in the U.S., the EU and Canada. The drug performed exceptionally well in the first quarter of 2014. The HCV treatment recorded sales of $2.27 billion in its first full quarter in the market. Sovaldi sales are expected to be strong throughout 2014. Japanese approval for Sovaldi will be sought by Gilead shortly.

Approval of the all oral HCV combination would further strengthen Gilead's position in the lucrative HCV market. We note that AbbVie ABBV and Bristol-Myers Squibb Company BMY are also aiming to bring HCV all-oral combination therapies into the market.

Gilead carries a Zacks Rank #1 (Strong Buy). Regeneron Pharmaceuticals REGN carries the same rank as Gilead in the healthcare sector.