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Gilead Sciences' Stock Rises on Prospects for Hepatitis C Pill


Some analysts say Gilead is now clearly in the lead for a better hepatitis drug.

MINYANVILLE ORIGINAL Shares of Gilead Sciences (GILD) rose as much as 6% Friday on sentiment, once again, that the biotech company is in the lead position for a better hepatitis C treatment.

Gilead is performing multiple studies to test an experimental drug, but the trial that is possibly the most intriguing looks at a combination therapy that rolls two medicines into a single pill. Gilead hopes to advance tests of its lead hepatitis drug GS-7977 in a combination with another company medicine, GS-5885. Wall Street analysts and investors are excited about the potential for this combination as a highly effective, safe, single pill. If all goes well in studies, the company may apply for US approval by 2014.

"This probably puts them in the lead," ISI Group analyst Mark Schoenebaum says.

Hepatitis C is a liver-wasting virus that affects millions of people. Gilead is in a highly competitive race for a better hepatitis treatment with rivals such as Bristol-Myers Squibb (BMY), Abbott Laboratories (ABT), Merck (MRK), Vertex Pharmaceuticals (VRTX), Idenix Pharmaceuticals (IDIX), and Roche (RHHBY).

Shares of Gilead were up 5% to $54.41 in late-morning trading. The stock is up 33% this year.

Pressure is on the company to prove that its almost $11 billion acquisition of Pharmasset will pan out. Gilead acquired GS-7977 in that takeover, which was completed earlier this year. (See Gilead Plans $11 Billion Takeover of Pharmasset to Gain Hepatitis Drugs.)

The company is likely to apply for US approval of GS-7977 next year. But the combo pill with the two drugs signals potential for an even more superior treatment compared with the current standard of care. Currently, medicines are taken with an injection of interferon, an immune booster that can have nasty side effects. The goal of all the next-generation hepatitis drug programs is to develop a treatment that doesn't require interferon. A single pill to treat the virus would be a real breakthrough.

"It's the ultimate frontier in (hepatitis) therapy," Gilead's chief scientific officer Norbert Bischofberger told investors on a conference call late-day Thursday. "That's what we want to pursue."

Bristol-Myers CEO Lamberto Andreotti has said Gilead should test GS-7977 with his company's drug, daclatasvir. Like GS-5885, daclastasvir is among a class of drugs called NS5A inhibitors. GS-7977 is known as a nucleotide polymerase inhibitor.

Gilead execs say they want to go forward with their own drug rather than testing with Bristol-Myers.

Twitter: @brettchase

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