AbbVie says it could beat Gilead to huge market for hep C drugs
Everybody loves a horse race, especially in the summer, when things can be kind of slow. And AbbVie ($ABBV) is making sure the market knows it is running neck-and-neck with Gilead Sciences ($GILD) to be the first to market with a new hep C drug therapy that has huge market potential and is expected to be key to future earnings for both companies.
The gauntlet was thrown down at an investment conference Thursday when AbbVie's head of drug development, Scott Brun, said, "We've got a very good shot at being first," Bloomberg reported.
That flies in the face of current thinking. There has been a growing consensus that Gilead's therapy is the one to beat in a market category forecast at $20 billion. Last week, Gilead said the FDA was granting it priority review, a step that can shave about four months off the approval process. But Brun said AbbVie's trial for its multidrug therapy is in the last of three stages typically required for U.S. approval and is headed down the course at a fast pace. ClearBridge Investments analyst Marshall Gordon told Bloomberg he thinks it is a race to the finish. "The idea is Gilead will be first, AbbVie will be on roughly the same timeline, Bristol-Myers will be somewhere after that," he said.
The prize each hopes to win is huge. There is tremendous expected demand for oral therapies that can quickly wipe out hep C without interferon, the injected drug that patients with the disease now take for up to a year that is tied to flu-like symptoms and other nasty side effects. According to Bloomberg, Gilead recently estimated 150,000 patients may seek treatment in the U.S. when these new drugs hit the market, perhaps later this year. That compares to only 85,000 patients taking current therapies.
Gilead, the leader in branded HIV meds, bet its future on its sofosbuvir when the company acquired the lead hep C candidate in its 2011 buyout of Pharmasset for about $11 billion. Some analysts initially saw that wager as way too high. Gilead's first-quarter earnings fell short of analyst expectations, and so investors are anxious for the hep C therapy to get approved and pay off. For AbbVie, which was spun off this year from Abbott Laboratories, a new hep C therapy may be even more key. It currently is getting most of its earnings from arthritis drug Humira, the world's best-selling drug but one that is facing a patent loss in several years. Its hep C therapy is the product furthest along it has in its pipeline.
Gordon says it could be a photo finish for the two companies. "AbbVie is not getting nearly the credit that Gilead is," he told Bloomberg. "It's funny to me that it's a foregone conclusion that Gilead has dominated the market."
- read the Bloomberg story
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