Hepatitis C drug makers react to FDA's decision on Idenix drug

Idenix Pharmaceuticals (IDIX) and Gilead (GILD), both makers hepatitis C drug candidates, are sinking after Idenix announced that the FDA had placed a partial clinical hold on its IDX184 hepatitis C treatment. The FDA's decision appears to be based on cardiac safety issues that arose during a study of Bristol-Myers' (BMY) Hep-C treatment, BMS-98604, Idenix said. Meanwhile, Idenix added that it was told by the FDA that the agency would be "looking at" other hepatitis C treatments that utilize nucleoside inhibitors. Gilead, like Idenix, is developing a hepatitis C drug that utilizes nucleoside inhibitors. However, Vertex's (VRTX) main HCV treatment, telaprevir, does not use nucleoside inhibitors. Similarly, Achillion's (ACHN) most advanced hepatitis C drug candidate is not a nucleoside inhibitor. In a note earlier today to investors, JP Morgan wrote that there is no evidence that Idenix's drug has any cardiotoxicity issues. As a result, the firm believes that the partial clinical hold could be resolved in a timely manner, and it reiterated an Overweight rating on Idenix. The firm adds that the news about Idenix shouldn't affect Gilead, since that company's hepatitis C treatment is already in Phase III testing and hasn't shown any signs of causing cardiac problems. Furthermore, Deutsche Bank reported that Gilead uses a different type of nucleotide for its hepatitis C treatment than Bristol-Myers and Idenix. While the latter two companies use guanosine based nucleotides, Gilead utilizes a uracil-based nucleotide, says Deutsche Bank. The firm believes that the FDA is concerned only about guanosine based nucleotides, and it recommended buying Gilead on today’s weakness. In mid-morning trading, Idenix tumbled $2.48, or 29.84%, to $5.83, while Gilead dropped 86c, or 1.48%, to $57.11. Conversely, Achillion (ACHN) jumped 4.58% to $6.17 and Vertex added 0.92% to $54.92.