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12:00 AM
 | 
Jul 23, 2007
 |  BioCentury  |  Finance

Ebb & Flow

While Gilead (GILD) barely budged on Wednesday's news that the U.S. Patent and Trademark Office granted a request by the Public Patent Foundation to review four patents underlying the company's Viread tenofovir HIV treatment, the stock took a hit on Friday, as investors balked at 2Q07 sales of a different HIV drug - Atripla.

The soft move on the Viread news should come as no surprise, as the drug has been superceded first by GILD's Truvada emtricitabine/tenofovir and then by Atripla, a once-daily fixed-dose combination tablet of Truvada and Sustiva efavirenz from Bristol-Myers (BMY) (see "Gilead's HIV Sales").

Atripla, which was approved in the U.S. in July 2006, posted 2Q07 sales of $212.4 million, up 12% from $190.2 million in 1Q07. The problem is that analysts expected sales of $228.9 million.

Moreover, on its conference call, GILD said it's discussing with EMEA whether Atripla should be taken with food or on an empty stomach. In the U.S., Atripla is taken at bedtime on an empty stomach. Similarly, Truvada is approved to be taken without food.

In Europe, however, Truvada's prescribing information says the drug should be taken with food. The problem is that efavirenz, the other component of Atripla, has a European label that says to take the drug on an empty stomach.

The company said it still hopes to receive European approval this year, but Norbert Bischofberger, CSO and EVP of R&D, said that "any requirement for additional data would delay the approval of Atripla in the European Union."

Thus, questions about Atripla dominated the Q&A portion of GILD's call. Indeed, there was only one question about the Viread patent issue, to which CFO and COO John Milligan responded that "we don't believe that it threatens the substance in intellectual property protection for Viread or any of our other HIV products" (see B6).

Overall, GILD's earnings were strong. Post-market Thursday, the company posted 2Q07 non-GAAP diluted EPS of $0.46, beating the Street's $0.39 estimate by $0.07 and up 48% from EPS of $0.31 in 2Q06.

The stock fell $1.67 to $38.75 on Friday and ended the week down $1.21.

GPC coattails?

Biotechs listed on the Frankfurt Stock Exchange were unscathed by another major setback among their ranks last week, as GPC Biotech (FSE:GPC; GPCB) plunged E7.85 (34%) to E15.11 on Friday when FDA released bearish briefing documents on the company's Orplatna satraplatin cancer compound (see BioCentury Extra, Friday, July 20).

It was the second major hosing of a German biotech in as many months, as Paion (FSE:PA8) dropped E6.26 (64%) to E3.54 on June 1 when its Desmoteplase missed the primary endpoint in a Phase III trial to treat acute ischemic stroke(see BioCentury, June 4).

Despite the negative summer news flow, investors are not taking a vacation from the group. Of the 27 public biotechs listed on the FSE, 14 traded down while 10 advanced last week.

Investors will get another chance to play GPC this week. On Tuesday, the Oncologic Drugs Advisory Committee (ODAC) will discuss the NDA for Orplatna to treat patients with hormone-refractory prostate cancer (HRPC) who have failed prior chemotherapy. The oral platinum compound has an Aug. 15 PDUFA date, but FDA's briefing documents suggested the agency may delay action on the NDA until survival data are released later this year(see Online Links, A11).

On the week, GPC fell E7.74 (34%) and slumped $7.80 (25%) to $24 on NASDAQ.

Not much Exuberance

Pfizer (PFE) broke out sales of Exubera inhaled insulin for the first time last week, and the results were meager. The drug posted 2Q sales of just $4 million. That's not a strong harbinger of the growth-driving potential the pharma cited when it paid $1.3 billion in early 2006 to acquire the share of Exubera rights held by partner sanofi-aventis(Euronext:SAN; SNY).

On PFE's conference call, Chairman and CEO Jeffrey Kindler said Exubera "continues to be disappointing." He did say there was some good news, as patients who actually use the drug have given "positive feedback."

Last month, PFE began taking the...

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