Replies to post #89624 on Biotech Values

[mcbio]

Re: ACHN conference call

I’m looking forward to hearing about ACHN’s HCV program whose compounds have an MoA so novel that the MoA couldn’t be disclosed. I think management’s handling of investor expectations with respect to this program has been silly, and this has (IMO) lowered management’s credibility, which wasn’t that high to begin with.

I understand what you're saying as they mentioned the program awhile back, but have yet to offer any meaningful details. Management did indicate that they were in the process of completing pre-clinical tox work for these compounds and that has been the hold-up in announcing the program. I guess the reasoning is: what's the point in discussing a program in much detail if you have yet to satisfy yourself that the pre-clinical profile looks clean? Presumably they are at that stage now and that's why we'll hear more about these compounds now. However, ACH-1625 needs to take center stage during this call as that compound is the key value-driver for ACHN in the very near future IMHO. And management also needs to properly address the recent dilution during the call.

From today’s PR:
Quote:
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…the Company will provide an update on partnering efforts related to its non-HCV assets, elvucitabine and ACH-702.
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[Dew] If the update is that ACHN plans to spend even a dime of its own money on these programs, that would be bearish, IMO.

Agreed. However, I don't expect this to be the case given how they've indicated that HCV is ACHN's primary focus now.

[mcbio]

ACHN - ACH-2684 nominated as new HCV candidate

[In addition to what I posted in #msg-45886350, I suspect one other possible explanation for why ACHN is being so secretive about this new HCV program is that ACHN believes this represents a novel HCV target/program and they don't want to disclose further detail at this time and invite competition. It's either that or they want others to think they have a new, novel HCV program. I imagine you lean towards the latter. ; )]

http://finance.yahoo.com/news/Achillion-Announces-pz-798360296.html?x=0

Achillion Announces Nomination of ACH-2684 as Lead Clinical Candidate in Resistance-Focused HCV Program
Compound Demonstrates Excellent Potency Against HCV and Retains Activity Against Resistant Variants

NEW HAVEN, Conn., Jan. 28, 2010 (GLOBE NEWSWIRE) -- Achillion Pharmaceuticals, Inc. (Nasdaq:ACHN) today announced the nomination of a lead clinical candidate in its third proprietary program against hepatitis C infection. The candidate, ACH-2684, demonstrates excellent potency in the low pico-molar range, as well as good pharmacokinetic and safety profiles in pre-clinical studies.

“The potency and virology profile of ACH-2684 demonstrates that it very effectively suppresses a broad range of natural variants of the hepatitis C virus, and may be effective in prevention and treatment of emerging resistant variants. This compound also retains potent activity against all genotypes. The very high potency of ACH-2684 was achieved by optimizing its interactions against NS3 protease. We have demonstrated in vitro that ACH-2684 can be used in combination with other HCV inhibitors, and that it is synergistic with NS5B nucleoside polymerase inhibitors,” said Milind S. Deshpande, Ph.D., Executive Vice President and Chief Scientific Officer of Achillion. “We have leveraged our expertise in HCV drug discovery and structure-based design to create a set of compounds, including ACH-2684, that are part of a discrete intellectual property estate and to which we currently retain all commercial rights."

Michael D. Kishbauch, Achillion’s President and CEO, stated, “We are quite pleased to announce a clinical candidate from our third proprietary HCV program, further demonstrating our robust drug discovery expertise in this important therapeutic area. The compound, with its potency–resistance profile and preliminary safety characteristics, has the potential to be highly complementary to both our Gilead-partnered NS4A antagonist compounds as well as our ACH-1625 protease inhibitor, which recently achieved strong proof-of-concept results. We expect to move to IND-enabling pre-clinical testing of ACH-2684, and initiate a Phase 1/1b study in 2011.”

The Company will provide additional information on ACH-2684 during its Corporate and Clinical Update conference call and simultaneous webcast on Monday, February 1, 2010 at 4:30 p.m. Eastern time. To participate in the conference call, please dial ( 866 ) 743 – 9944 in the U.S. or ( 720 ) 545 - 0058 for international callers. A live audio webcast of the call will be accessible at www.achillion.com, under the News Center section of the website. Please connect to Achillion's Web site several minutes prior to the start of the broadcast to ensure adequate time for any software download that may be necessary.

About HCV

The hepatitis C virus (HCV) is the most common cause of viral hepatitis, which is an inflammation of the liver. It is currently estimated that more than 170 million people are infected with HCV worldwide and The American Association of Liver Disease estimates that up to 80% of individuals become chronically infected following exposure to the virus. If left untreated, chronic hepatitis can lead to permanent liver damage, which can result in the development of liver cancer, liver failure or death. Few therapeutic options currently exist for the treatment of HCV infection. The current standard of care is limited by its specificity for certain types of HCV, significant side-effect profile, and injectable route of administration.

About Achillion

Achillion is an innovative pharmaceutical company dedicated to bringing important new treatments to patients with infectious disease. Achillion’s proven discovery and development teams have advanced multiple product candidates with novel mechanisms of action. Achillion is focused on solutions for the most challenging problems in infectious disease – hepatitis C, resistant bacterial infections and HIV. For more information on Achillion Pharmaceuticals, please visit www.achillion.com or call 1-203-624-7000.

[mcbio]

ACHN Corporate/Clinical Update (2/1/10)

http://ir.achillion.com/events.cfm

[Warning: the call is about 75 minutes long, though quite informative IMO. I'm summarizing what I thought were some key points. These don't all necessarily follow the chronology of the call itself as points made later in the call often go together better with ones made earlier IMO.]

From today’s PR:
Quote:
--------------------------------------------------------------------------------
…the Company will provide an update on partnering efforts related to its non-HCV assets, elvucitabine and ACH-702.
--------------------------------------------------------------------------------

[Dew] If the update is that ACHN plans to spend even a dime of its own money on these programs, that would be bearish, IMO.

No additional ACHN money will be spent on these non-HCV programs. The key points with respect to the HCV programs and additional comments related to the non-HCV programs were, IMO, as follows:

1. ACHN plans to test two additional cohorts of ACH-1625 in the ongoing Phase 1b trial. At least one of these will be a QD dose and the other may be a lower BID dose. In response to comments during Q&A when discussing the inverted dose curve of the Phase 1 trial as they started off at higher doses and are now going lower, it was mentioned that ACHN may ultimately dose back up when they get to the QD dose. ACHN believes there is a high likelihood that ACH-1625 will ultimately have QD dosing. Management stressed that the dose was not dropped due to any "signal" that forced them to drop the dose down.

2. Expect data from these two additional cohorts to be disclosed after EASL, which is in April.

3. Financing was done to avoid "predatory" partnering. ACHN believes they are in better position to partner ACH-1625 now. ACHN wants to do the right partnership that is both strong economically and is with the right partner.

4. Partnering discussions for ACH-1625 have intensified quite a bit and have accelerated since the Phase 1b PoC data and ACHN believes they are now in a stronger position since the PoC data and the recent financing. A number of these discussions are quite advanced and ACHN is in discussion with "north of six" of the major HCV players. All of the partners, with the exception of one, were focused on the PoC data as grounds for moving forward to a term sheet. The one exception wanted to see 28-day data. After PoC, this party informed ACHN that they still want to see 28-day data but, if ACHN were to receive any term sheets in the meantime, they would like to know about it immediately.

5. ACHN believes that the data they have to date for ACH-1625 is largely sufficient to move into a partnership if they choose to take it.

6. The recent financing gives ACHN sufficient cash for the next 18 months, excluding any funding received from partnerships.

7. ACHN is making plans to move into Phase 2 for ACH-1625. ACHN indicated they now have the proceeds to proceed through Phase 2 for ACH-1625 on their own under the rareified assumption of no additional partnering revenue which they consider "quite unlikely." ACHN is planning for a 28-day trial in the U.S. [It wasn't clear to me if it was a certainty that ACHN will do the Phase 2 on its own or if they expect to partner ACH-1625 now. It appears that they will partner if the terms are right, but otherwise have the funds now to take ACH-1625 through Phase 2. Mike Kishbauch noted that 14-28 day HCV data can increase the economics of a partnering deal from 1.5 to 2x versus earlier stage data.]

8. ACHN will have to do a Phase 1 SAD study in the U.S. to "bridge" a new dose formulation that they are finalizing now before they proceed on to the Phase 2. ACH-1625 is completing 3-month tox studies now.

9. ACH-2684 - ACHN engineered key interactions against the P3/P4 region of binding against the NS3 HCV protease. ACH-2684 has a half-life of greater than 120 hours. 14 day tox studies have been clean. ACHN believes its profile supports QD dosing. ACH-2684 potency is much greater than existing PIs in the clinic, including ACH-1625. Also, most PIs have weak activity against HCV genotype 3, but ACH-2684 appears to be equally effective against all genotypes. Differentiating characteristics of ACH-2684 versus ACH-1625 and more advanced PIs in the clinic appears to be potency, activity against all genotypes, and activity against genotype mutants and quasi-species variants of HCV.

10. Amino acids 155, 156, and 168 appear to be emerging mutants resistant to existing HCV PIs. ACH-2684 appears to be effective against all of these. In regards to one question, it was noted that ACH-1625 is quite effective against the 155 mutation (boceprevir is not; no mention of telaprevir, so presumably it is effective), but there was no further clarity on the 156 and 168 mutations so perhaps it is not effective against these mutations.

11. ACHN is considering whether ACH-1625 and ACH-2684 will be packaged together in a partnering deal. They will only do this if the economics of the deal are very lucrative for shareholders. At least half of the partners engaged in discussions with ACHN for ACH-1625 are also aggressively focused on ACH-2684. ACHN is not afraid of a potential partner acquiring rights to both compounds and shelving 1625 for 2684 due to the fact that 1625 is 1 - 1.5 years ahead of 2684.

12. ACH-1625 has its own backup compound known as ACH-2676.

13. ACH-2684 is additive to non-nukes and significantly synergistic with nukes. Additive means no reduction in dose when combining compounds whereas synergistic means the dosage of two compounds can likely be lowered, giving lower potential for resistance.

14. ACH-1095 - ACHN submitted its pre-IND consultation package to the FDA around Thanksgiving, but no specific date has been set to meet with the FDA. ACHN expects to know the path forward for 1095 within the next 2-3 months.

15. Additional color on 1095 pre-clinical tox signal - In the 28-day rat study, there was a signal of vacuolation in cardiomyocytes. As previously noted, this signal was not seen in dogs or monkeys.

16. Elvucitabine deal w/GCA Therapeutics - deal back-end loaded/no up-front payment. But, ACHN incurs no additional expenses with respect to the future development of the compound and is entitled to future milestones and double-digit royalties on net sales. Though not a big name, this partner has an outstanding track record in Asia. The first trials for elvucitabine will be focused on HBV. HBV market in China is north of 100 million infected patients. Hepsera and Baraclude have not fared well in China but elvucitabine has an extended half-life of over 100 hours, which ACHN believes will give it a significant dosing advantage over the competition. ACHN believes elvucitabine can capture a significant portion of China's HBV population. ACHN believes that this deal is the first of several for elvucitabine and they hope to strike deals in South Africa and South America.

17. ACH-702 - will advance via partnership only. Partnering discussions are increasing. ACHN hopes to provide an update on partnering this summer.