Gilead Soars on Positive CHMP Opinion
Shares of Gilead Sciences, Inc. (GILD) hit a 52-week high of $75.21 on Nov 22, 2013 buoyed by the positive opinion of the European Medicines Agency’s (:EMA) Committee for Medicinal Products for Human Use (CHMP) on the company’s hepatitis C virus (:HCV) candidate sofosbuvir (proposed trade name: Sovaldi) 400mg once daily tablets.
The CHMP recommended the approval of Sovaldi as a combination therapy for treating HCV patients. The positive opinion by the CHMP will be reviewed by the European Commission, which will issue the final opinion on whether to approve the HCV candidate in the EU.
We remind investors that Gilead submitted the marketing authorization application (MAA) for Sovaldi on the basis of encouraging data from four phase III studies (NEUTRINO, FISSION, POSITRON and FUSION). Data from the studies revealed that Sovaldi-based therapy for 12 or 16 weeks was either superior or non-inferior to currently available HCV treatment options.
The EMA granted Gilead’s request for accelerated assessment of the company’s MAA for the HCV candidate. Gilead expects Sovaldi to be available in the EU by the first quarter of 2014, assuming approval. Gilead is also seeking U.S. approval (target date: Dec 8, 2013) for the high potential HCV candidate.
Approval of Sovaldi would bring down the duration of HCV therapy. Currently, HCV therapy includes 24-48 weeks of treatment with injectable peg-IFN. Moreover, the current standard of care comes with several side effects which make it difficult for patients to remain on treatment.
Approval of Sovaldi would not only boost Gilead’s top line but would also strengthen its position in the lucrative HCV market. A sizeable population suffers from HCV throughout the world. However, the treated population is much lower. This leaves the field open for new treatments. We note that companies such as Johnson & Johnson (JNJ) and Bristol-Myers Squibb Company (BMY) are also developing therapies to combat HCV.
Gilead, a biopharmaceutical company, carries a Zacks Rank #3 (Hold). Investors interested in the biopharmaceutical industry may consider Actelion Ltd. (ALIOF) carrying a Zacks Rank #1 (Strong Buy).
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