Data to be Presented at AASLD Meeting

Press Release: November 2, 2007

Romark Laboratories, a privately-owned biotechnology company, today announced results of a randomized phase II clinical trial showing that 79% of interferon-naïve patients with chronic hepatitis C genotype 4 receiving nitazoxanide plus the standard of care had a sustained virologic response (SVR), or undetectable level of virus, 12 weeks following treatment, compared to 43% of patients receiving the standard of care without nitazoxanide. The patients treated with nitazoxanide also experienced no relapse and no more side effects than patients who received the standard of care. Interim results from this Phase II clinical trial will be presented on Tuesday November 6 in an oral presentation at the 58th Annual Meeting of the American Association for the Study of Liver Diseases (AASLD) in Boston.

“Patients treated with nitazoxanide responded earlier and maintained their responses without relapse after receiving only 36 weeks of treatment with peginterferon and ribavirin,” said Dr. Emmet B. Keeffe, Chief of Hepatology at Stanford University School of Medicine. “These data suggest the emergence of a new therapeutic approach for treating hepatitis C. While more study is needed to confirm these results in a broader population of patients, nitazoxanide appears to increase the potency of interferon without increasing toxicity or inducing resistance.”

Study Details
This Phase II randomized, controlled trial was conducted at two centers in Egypt and is part of the company’s STEALTH C (Studies to Evaluate Alinia for Treatment of Hepatitis C) clinical development program, which is designed to evaluate the safety and efficacy of nitazoxanide tablets in combination with peginterferon or peginterferon and ribavirin (standard of care) in patients with chronic hepatitis C.

In the trial, 96 treatment-naive patients with chronic hepatitis C genotype 4 were randomized into three groups to receive either 48 weeks of standard of care treatment (n=40), 12 weeks of nitazoxanide followed by 36 weeks of nitazoxanide plus peginterferon (a dual regimen, n=28), or 12 weeks of nitazoxanide followed by 36 weeks of nitazoxanide plus standard of care treatment (a triple regimen, n=28). An additional 24 interferon-experienced patients were randomized to receive 12 weeks of nitazoxanide followed by either the dual regimen (n=12) or the triple regimen (n=12) for 36 weeks. Patients received 180 microgram injections of pegylated interferon (Pegasys®) once per week; nitazoxanide was administered as one 500 mg tablet twice daily; and ribavirin was administered as 1,000 or 1,200 mg daily according to weight.

Results
At 12 weeks following the end of treatment, naïve patients who received a triple regimen that included standard of care and nitazoxanide showed a significantly higher SVR (HCV RNA

16 Recommendations

On Friday, the annual meeting of the American Association for the Study of Liver Diseases (AASLD) convenes, and several drug developers — from Roche to smaller development-stage participants such as Pharmasset (Nasdaq: VRUS) — will present data on their lead compounds for treating hepatitis C.

It’s an exciting time to follow the hepatitis C treatment space, since there have never before been so many new compounds in development for the disease. With so many compounds to sift through, we can look at the leading drug candidates that may play a role in changing how the hepatitis C virus (HCV) will be attacked.

The leaders
Right now, most patients infected with the genotype 1 HCV — the most common subtype of HCV in North America and Europe — are treated with an interferon-based therapy consisting of either Schering-Plough’s (NYSE: SGP) PEGINTRON or Roche’s Pegasys.

Only about half of the genotype 1-infected patients who are treated with these standards of care, in combination with ribavirin, achieve a sustained virologic response, meaning they show no signs of HCV in their blood six months following treatment.

Having no signs of HCV at any time during a course of treatment means a patient has undetectable viral loads. When patients achieve undetectable viral loads, it could indicate the possibility of a sustained virologic response and, perhaps, ultimately being cured of the disease.

The future of HCV treatment will almost assuredly consist of a combination of an interferon and an oral antiviral drug. More than a dozen oral antivirals are in various development stages, ranging from Abbott Labs’ (NYSE: ABT) preclinical-stage protease inhibitor to Vertex Pharmaceuticals’ (Nasdaq: VRTX) phase 2 candidate, telaprevir.

Here are the leaders in efficacy and stage of clinical development in the race to become the first oral antiviral hepatitis C treatment on the market.

Drug
Developer

Select Study Results*

Development Phase

HCV Target

R1626
Roche

81% of patients with undetectable viral loads after 4 weeks at optimal dose, in combination with Pegasys in treatment-naive patients.

Completed phase 2a testing.

Nucleoside polymerase inhibitor

R7128
Pharmasset

Up to a mean 2.7 log reduction in viral loads after 14 days of treatment as monotherapy in treatment-experienced patients.

Phase 1 combination therapy testing.

Nucleoside polymerase inhibitor

Telaprevir
Vertex

79% of patients with undetectable viral loads after 12 weeks at optimal doses, in combination with Pegasys in treatment-naive patients in most recent study.

Multiple ongoing phase 2 studies.

Protease inhibitor

HCV-796
ViroPharma (Nasdaq: VPHM)

73% of patients with undetectable viral loads after 12 weeks in combination with PEGINTRON in treatment-naive patients.

Dosing in phase 2 study halted because of adverse events. Patient follow-up continues.

Non-nucleoside polymerase inhibitor

Boceprevir
Schering-Plough

79% of patients with undetectable viral loads at optimal dose after 12 weeks, in combination with PEGINTRON in treatment-naive patients.

Multiple ongoing phase 2 studies.

Protease inhibitor
*Study results in genotype 1 HCV patients and all combination study results include the use of ribavirin.

All the compounds above that have enough data to date show incredible improvements in undetectable viral loads (if the data holds up over longer testing), versus about half of the patients who achieve a sustained virologic response from PEGINTRON or Pegasys therapy alone.

Still, it’s not all gravy for the anti-HCV drugs in the table: Every single compound except the Pharmasset drug (which has not been tested in patients very long) has shown side effects, such as a rash with telaprevir, gastrointestinal problems with boceprevir, neutropenia with R1626, and high liver enzyme levels with HCV-796.

Innovations everywhere
The advent of antiviral compounds isn’t the only innovation under way for treating HCV. There are also drugmakers, including Flamel Technologies and Human Genome Sciences, attempting to develop improved versions of the interferons. Flamel’s drug is in phase 1 testing, and Human Genome Sciences expects phase 3 results from its compound, dubbed albuferon, in 2009.

A more distant future in combating hepatitis C could see the disappearance of the interferons from treatment altogether and the combination use of only antiviral drugs. Roche, Schering-Plough, Abbott, and Gilead Sciences (Nasdaq: GILD) all have the resources to develop antiviral-only combination therapies, similar to what is used to treat HIV. At the AASLD meeting, Schering, Novartis, and Idenix Pharmaceuticals (Nasdaq: IDIX) will present preclinical data on in vitro testing of a polymerase and protease inhibitor in combination treatment without an interferon therapy.

Participants in the upcoming AASLD meeting know that, even though there have been stumbles in 2007 with Idenix’s lead HCV drug valopicitabine, Achillion Pharmaceuticals’ GS 9132, and ViroPharma’s HCV-796, it’s still an unprecedented time in the development of HCV therapies.

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NEW YORK (AP) - Shares of biotechnology company Vertex Pharmaceuticals Inc. rose Wednesday after Banc of America Securities upgraded the stock, citing a positive forecast for the hepatitis C drug candidate telaprevir.

Shares rose 99 cents, or 4.4 percent, to $23.72 in midday trading. The stock has traded between $20.71 and $41.42 over the last 52 weeks.

Banc of America analyst William Q. Sargent upgraded the stock to “Buy” from “Neutral” and raised the price target to $34 from $29, citing increased confidence that upcoming study results will drive shares higher.

The company’s key drug candidate is telaprevir. Positive results from a midstage study could be released in the second quarter, according to the analyst. Sargent also expects the Food and Drug Administration to approve late-stage studies for the drug candidate.

“Telaprevir’s market leadership may be under-appreciated,” he said, in a note to investors, adding that recent discounts to Vertex shares have created a buying opportunity for investors.

Cambridge, Mass.-based Vertex faces competition from Schering-Plough Corp., which is conducting midstage studies on its hepatitis C drug candidate boceprivir. Results are expected later this year. InterMune Inc., meanwhile, is still in the early stages of development for its experimental drug ITMN-191.

Based on data already available for telaprevir, Sargent said, the drug should be able to clear hepatitis virus more effectively than current treatments, and may even receive a quicker review process by the Food and Drug Administration. Despite that possibility, he shifted expectations for approval to early 2011 from late 2010.

Elsewhere, on Tuesday Robert W. Baird analyst Thomas Russo initiated coverage on Vertex with a “Neutral” rating and $25 price target, saying telaprevir has multi-billion dollar potential and will be adopted quickly if approved.

Analysts expect Vertex to provide an update on its late-stage study design for telaprevir Feb. 11.

Lazard Capital Markets analyst Terence Flynn reaffirmed a “Sell” rating with a $16 price target for Vertex while touting a “Buy” rating and $30 price target for InterMune.

He said telaprevir’s launch will most likely occur after 2010, and initial details show the late-stage study design could be more cumbersome than initially expected. InterMune, meanwhile, will likely successfully develop a twice-daily dosing schedule for ITMN-191, he said. The company has been working on both twice-daily and three-times per day dosing.

Shares of Brisbane, Calif.-based InterMune rose 25 cents to $18.97, while shares of Kenilworth, N.J.-based Schering-Plough rose 10 cents to $23.88.

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