Gilead Quad HIV Drug Meets Standard

Updated with additional information, analyst comments.

FOSTER CITY, Calif. (TheStreet) -- Gilead Sciences' (GILD) experimental single-tablet "Quad" HIV therapy was found to be statistically equivalent to the company's currently marketed HIV drug Atripla, meeting the primary goal of a late-stage study, the company said Monday.

The Quad, which combines four Gilead drugs into a single pill, is a cornerstone of the company's efforts to maintain its dominance in the HIV treatment market and fight off a looming generic threat.

Gilead plans to seek regulatory approval for the Quad pill in the first quarter of 2012. If approved, Gilead will seek to convince doctors to both prescribe the Quad to newly diagnosed HIV patients and perhaps more importantly, switch patients off existing HIV therapies, including Atripla.

Treatment with the Quad was found to be statistically non-inferior to Atripla, according to the phase III study results announced Monday. Eighty-eight percent of treatment-naive HIV patients treated with the Quad for 48 weeks achieved a clinically meaningful reduction in viral load compared to 84% of patients treated with Atripla, according to Gilead.

Quad-treated patients also achieved a statistically significant increase in the levels of CD4 cells compared to Atripla-treated patients.

The side effect profile and treatment discontinuations were "similar" and "comparable" between the two drugs, but Gilead did not provide additional details in its announcement.

Some investors were hoping to see Quad show statistically superior efficacy over Atripla. In the absence of that, it's important for Quad to be more tolerable and have fewer side effects than Atripla in order to induce doctors to convert patients to the drug when it is approved.

Gilead shares were off $1.15, or 3%, to $36.30 in early Monday trading, likely due to lack of detailed data on Quad's safety profile compared to Atripla.

Quad combines four Gilead drugs into a once-daily single-pill treatment for HIV. Two of the Quad components are experimental: Elvitegravir, an integrase inhibitor; and cobicistat, an agent that boosts the blood level of elvitegravir but which has no effect on HIV on its own. These two drugs are further combined with currently approved Gilead HIV therapy Truvada (which consists of the Gilead drugs Viread and Emtriva.)

Atripla and Truvada, with 2010 sales of $2.93 billion and $2.6 billion, respectively, are Gilead's most important HIV treatments, but patents that begin to expire in 2017 will allow the launch of generic versions of these regimens. Investor concerns about these patent expirations and the negative financial impact they'll have on Gilead's HIV franchise and its long-term growth, have weighed on the stock's performance for some time.

In a research note to clients Monday morning, JP Morgan biotech analyst Geoff Meacham said Gilead officials told him that there was "nothing unexpected" in the Quad's safety data from the phase III study, which suggests that Quad will be differentiated enough from Atripla.

A second phase III study comparing the Quad against the Bristol-Myers Squibb (BMY) HIV drug Reyataz and Truvada is underway with results expected later this quarter.

--Written by Adam Feuerstein in Boston.



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