| |
Vertex Telaprevir HCV Protease Inhibitor Could Be A Winner; 2.5 million untreated/undiagnosed
|
| |
| |
April 18, 2008: 08:06 PM EST
CNNmoney.com
Vertex Pharmaceuticals
Cambridge, Ma.
When you're close to the finish line and the competition is lagging way back, it's tempting to ease up. Not so at Vertex.
In the race to get a better hepatitis C drug to patients, Vertex (VRTX) wants to be the standard of care before competitors show up.
Hepatitis C, or HCV, can lead to liver disease and cancer. It has infected 170 million people worldwide -- more than five times the number with HIV/AIDS.
By 2010, the market for HCV treatments will be $4 billion, says analyst Brian McCarthy of Merriman Curhan Ford, which seeks Vertex's business. He sees the market rising to $8 billion by 2015.
Kurt Graves, Vertex's chief commercial officer, figures there might be 4 million people with HCV in the U.S, with 2.5 million undiagnosed or untreated .
Vertex's drug, a protease inhibitor called Telaprevir, has started phase three clinical trials and could reach the market by 2011.
"I see no reason to doubt Vertex's ability to get to market first," McCarthy said. "And Telaprevir could potentially alter the standard of HCV care."
On April 24 Vertex will outline details about Telaprevir's effectiveness at a European conference.
Those details no doubt will interest rival HCV drug developers like Schering-Plough (SGP), Roche (RHHBY), AstraZeneca (AZN), Pfizer (PFE), Pharmasset (VRUS), InterMune (ITMN), Anadys (ANDS), Idera (IDRA), ViroPharma (VPHM) and Idenix (IDIX). Some of their drugs are in phase two trials.
"Competing drugs will enter the picture just as Telaprevir hits peak sales," McCarthy said.
THE FINANCIALS
Vertex shares, which trade near 26, have surged more than 80% since March 18.
The big bump came on March 31, when shares rose 28% after the company cited data from a midstage study showing hepatitis C patients responded to Telaprevir. But the stock still remains well off its 52-week high of 41.42, set in September.
Thomson Reuters analysts see losses edging down to $2.93 a share this year from $3.03 in 2007. Losses are expected to narrow to $2.83 in 2009, with the first profit, at $2.16 a share, projected for 2012.
The company has one drug on the market, shared with Glaxo, but gets most of its revenue from partners with deep pockets.
THE COMPANY
Partnerships are a key part of Vertex's strategy to develop Telaprevir. The company has deals with the Janssen unit of Johnson & Johnson (JNJ) unit and with Mitsubishi Pharma.
Vertex will share North American sales with Janssen and get 20% of Janssen sales in Europe, South America, the Middle East, Africa and Australia. Mitsubishi will market in Japan and other Asian countries.
Janssen has paid Vertex $165 million upfront and $30 million of a potential $380 million in milestones. The Mitsubishi deal is for $33 million plus royalties.
LOOKING AHEAD
Vertex has second-generation protease inhibitors in the works on which it plans to build a multidrug portfolio around Telaprevir, Graves says.
"We're looking at technology to license in that could complement Telaprevir," he said.
Newstex ID: IBD-0001-24618683
Originally published in the April 21, 2008 version of Investor's Business Daily.
|
|
| |
| |
|
|
|
