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Biotech Stock Mailbag: All You Need to Know About Hep C Drugs

Stocks in this article: CLDXGILDBMYAGEN

At EASL, Gilead-sponsored researchers will present so-called "SVR4" results from the Electron trial. That's Hep C medical jargon for the percentage of patients who are virus-free four weeks after treatment ends. Patients aren't deemed "cured" of hepatitis C unless they remain virus-free for 12 weeks following treatment, i.e. SVR12 but SVR4 results will be an early and important marker of '7977's efficacy.

OK, what to expect? A 60% SVR4 rate, according to a poll of 204 Wall Street investors conducted by Mark Schoenebaum, the biotech and pharmaceuticals analyst at ISI Group.

The second Gilead study is dubbed Quantum and is also using a combination regimen of '7977 and ribavirin, although patients in this study have genotypes 1,2 or 3 (the latter two being a bit easier to treat). The other major difference between Quantum and Electron is that treatment duration in Quantum is 24 weeks.

Gilead is not presenting Quantum results at EASL but is expected to issue a press release with data from the study early this quarter, which could come any day.

Expectations? Again, from the same Schoenebaum investor survey: 62% SVR4 for the genotype 1 patients from Quantum.

Remember, Gilead spent $11 billion to acquire Pharmasset and gain control of GS-7977 in an audacious bid to wrest a front-runner spot in the race to develop the most effective all-oral Hep C therapy. Billions of dollars in future Hep C drug sales are riding on GS-7977. That's why investors are so heavily focused on next week's EASL meeting. Contributing to the collective Wall Street agita are poor results from GS-7977 in previously treated Hep C patients announced in February.

One more EASL study to watch very closely: A combination of Bristol-Myers Squibb's (BMY) daclatasvir with Gilead's '7977 in patients with genotypes 1,2 and 3. Early results from this study leaked this week. Ninety-seven percent of genotype 1 hepatitis C patients treated with daclatasvir-'7977 had undetectable viral levels after 12 weeks of treatment. For genotype 2/3 patients, the 12-week response rate was 90%.

At EASL, researchers are expected to present SVR4 results -- but for how many patients and which Hep C genotype isn't entirely clear.

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