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What: Shares of hepatitis-C-focused biotechnology firm Idenix Pharmaceuticals (NAS: IDIX) crashed as much as 35% after receiving unfavorable news for its leading experimental drug candidate, IDX184.
So what: Idenix Pharmaceuticals received word from the Food and Drug Administration in a letter today that it was placing a hold on IDX184, a mid-stage treatment for hepatitis C that had shown significant efficacy in recent studies. According to the FDA, the reason for the hold stems from an adverse cardiac event that happened with a competitors' nucleotide polymerase inhibitor. That letter is referring to Bristol-Myers Squibb (NYS: BMY) , which suspended its phase 2 trial of BMS-986094 which it acquired when it purchased Inhibtex for $2.5 billion earlier this year. Gilead Sciences (NAS: GILD) , whose GS7977 has been at the forefront of hepatitis C innovation, dropped as well since its drug is also a nucleotide-based inhibitor.
Now what: Don't for one second think this is a reason to run out and buy Achillion Pharmaceuticals (NAS: ACHN) since it has a non-nucleotide-based treatment, because it's not! There's very little reason here to believe that Gilead Sciences will have any long-term effect from Idenix's bad news; I hold this as even more evidence that Gilead has the clear path to be the first non-interferon-based hepatitis C treatment to be approved by the FDA. Until that time, the hepatitis C market is Vertex Pharmaceuticals' (NAS: VRTX) to lose and Incivek will remain the premier treatment. Idenix clearly has a lot of hurdles to overcome and there just may not be much of the hepatitis C pie left by the time it works out all of its kinks.
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The article Why Idenix Pharmaceuticals Shares Imploded originally appeared on Fool.com.Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong. Motley Fool newsletter services have recommended buying shares of Vertex Pharmaceuticals and Gilead Sciences. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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