A Hep C Love Triangle
Nov 1st 2012 3:49PM
Updated Nov 1st 2012 3:52PM
Vertex Pharmaceuticals (NAS: VRTX) has found not one but two new beaus, although it's keeping the relationships casual.
For a disease like hepatitis C where combinations will be the new norm, getting in bed with as many players as possible is critical. Assuming of course you're not Gilead Sciences (NAS: GILD) or Abbott Labs (NYS: ABT) , which have all the drugs they need to make a decent combination on their own.
Vertex doesn't. It has VX-135, which looks like it might be a decent nuc, but it needs to combine VX-135 with other drugs to reach the high cure rates Gilead and Abbott have put up.
Simeprevir is a protease inhibitor that's in the same class as Vertex's already-approved Incivek. Vertex is hedging its bet with this partnership because it's generally assumed that the second-generation protease inhibitors will be better than Incivek and Merck's (NYS: MRK) Victrelis.
Johnson & Johnson and Vertex will split the cost of the phase 2 trial scheduled to start early next year. Once they see that data, they'll presumably figure out a development plan because the current deal doesn't extend beyond the proof-of-concept study.
The deal with Glaxo has a similar structure. The companies will split the cost of a phase 2 proof-of-concept study combining VX-135 and NS5A inhibitor GSK2336805 with or without ribavirin, a generic drug. That pair is shooting for starting that trial early next year.
Left out in the cold is Bristol-Myers Squibb (NYS: BMY) , which also has an NS5A inhibitor called daclatasvir. The drug worked well with Gilead's nuc GS-7977, so it's curious that Vertex went with Glaxo's NS5A inhibitor rather than daclatasvir.
Of course, considering that the deals seem pretty casual, Vertex might be able to partner with Bristol as well.
Love square, anyone?
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The article A Hep C Love Triangle originally appeared on Fool.com.Fool contributor Brian Orelli has no positions in the stocks mentioned above. The Motley Fool owns shares of Gilead, GlaxoSmithKline, and Johnson & Johnson. Motley Fool newsletter services recommend Gilead, GlaxoSmithKline, Johnson & Johnson, and Vertex Pharmaceuticals. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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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