Replies to post #116154 on Biotech Values

[mcbio]

VRUS’ 2-drug oral combo consisting of PSI-7977+PSI-938 looks like a better bet than VRTX’s 2-drug oral combo of Telaprevir+VX-222, but I think a cocktail of three oral drugs will likely be needed to generate the kind of SVR rate capable of supplanting the current SoC of interferon and ribavirin.

I agree with you vis-a-vis the likely necessity of three oral drugs. This is still very early data that VRUS has run up on and I would imagine the stock might be prone to a nice pullback if investors do ultimately see that this two-drug combo won't be enough (i.e., if there is viral breakthrough in longer-term studies). (There's also the risk of Roche dropping RG7128.)

But, I'm also curious what impact this data may have on ACHN. Will the market view VRUS' combo as a potential end-all-be-all combo for HCV and thus dampen their outlook for ACHN (even if ACHN is dealing in the PI and NS5A class, which is totally complementary to what VRUS is doing)? If so, that further strengthens my belief that I may be able to continue to safely sit out ACHN for the pending 28-day data on ACH-1625 and the ultimate 12-week data towards year-end, which are two key and risky binary events for ACHN. I.e., even if data is positive for both events, perhaps there may be a somewhat muted response in light of the combo data for VRUS. If so, I think that would be a nice buying opportunity in ACHN and I have an eye towards that, if it plays out that way.

I listened to ACHN's presentation at Cowen yesterday and, for the first time, ACHN mentioned the prospect of a "takeout." Management indicated that interest picked up since AASLD last year for partnering and also referenced discussions regarding a takeout. Then they indicated that they see a chance to create better value towards year end for either partnering or a takeout (presumably the 12-week data for 1625). That said, they didn't seem to rule out either occurring earlier as I recall Kishbauch saying ACHN expects a lot more deals to be done this year in the HCV space, including those of the collaboration variety that BMY/VRUS just entered into (I think that kind of deal would be bad for ACHN as I think they need a big up-front cash infusion to spark the stock and not just some agreement with big pharma where big pharma agrees to run a trial but offers no cash in exchange). Kishbauch said that ACHN doesn't want to be left behind but it seems like they're still more likely to wait until after 12-week data on 1625 to do anything IMHO. (Kishbauch said something like 60/40 that they would wait to do anything, as opposed to doing something really short-term.)

[dewophile]

but I think a cocktail of three oral drugs will likely be needed to generate the kind of SVR rate capable of supplanting the current SoC of interferon and ribavirin

the best chance for a 2 drug cocktail is a combination of nukes since they each have higher barriers to resistance. i'm not sure for these particular nukes what mutation(s) are necessary to confer resistance, but if you need more than one mutation for example for resistance to an agent it almost as if it is equivalent to giving 2 (or more) drugs. for example baraclude if memory serves me right requires three mutations for resistance - that one drug is in effect almost like multitherapy in terms of resistance