Biotech Values

[jbog]

ISI Group’s Joe Ruggieri calls Merck’s results “excellent” but doesn’t see a threat to Gilead Sciences:

[Merck] Hep C data in one pill/day 12 week regimen this morning (EASL) in G1 population (75% of mkt) was excellent (98% cure). Numbers should rise on this as street only had ~$400MM in consensus peak sales (implying ~3% mkt share). [Merck] will also likely have definitive phase 3 in 2015. [Gilead Sciences] currently dominates this market and Mark and other analysts have already assumed [Gilead Sciences'] mkt share will drop to ~60-75% in G1 share at peak. Key question is who grabs the other ~25-40%? [Merck] seems to be leading contender for this now which could put some competitive pressure on [AbbVie (ABBV), Bristol-Myers Squibb (BMY)] and lesser extent [Idenix Pharmaceuticals (IDIX), Achillion Pharmaceuticals (ACHN).]

Also, [Gilead Sciences'] regimen can be used (eventually) in all genotypes and is likely 8 weeks while [Merck's] regimen can only be used in G1 (we are awaiting G2/3 data) and appears to be dosed for 12 weeks. Thus barring massive price differences, [Merck] will not likely threaten [Gilead Sciences] for the #1 position.

Nomura’s M. Iam Somaiya also thinks Gilead will be able to fend off challenged from AbbVie, Merck and others:

We are raising our revenue estimates for Gilead’s HCV franchise as we take into account strong prescription data to date and more importantly comments by renowned hepatologist, Dr. Stefan Zeuzem, on emerging competition from AbbVie and Merck. We believe recent sell-off in [Gilead Sciences] provides investors an even more compelling buying opportunity, as our dinner with Dr. Zeuzem highlighted key advantages for Gilead’s HCV combo of sofosbuvir + ledipasvir. In particular, Dr. Zeuzem pointed out the need for ribavirin with AbbVie’s regimen when used in genotype 1A cirrhotic patients and physicians’ general aversion to using this regimen in HIV co-infected patients given use of a ritonavir booster. For Merck, Dr. Zeuzem suggested keeping an eye on rates of Grade 3 ALT elevations.

http://blogs.barrons.com/stockstowatchtoday/2014/04/10/gilead-sciences-how-big-a-threat-is-merck/?mod=yahoobarrons&ru=yahoo