Achillion Hep C Drug Update is Well Timed
Talk about uncanny timing, one day after Achillion Pharmaceuticals (ACHN) rips higher on takeover speculation, the company announces the lifting of an FDA clinical hold on its lead hepatitis C drug candidate and the start of a new study with a second hepatitis C compound.
What an amazing coincidence!
Achillion shares are moving 35% higher to $5.75 in Tuesday's premarket. The stock gained 48% to $4.25 on Monday on the back of Merck's (MRK - Get Report) $3.9 billion acquisition of Idenix Pharmaceuticals (IDIX) to bolster its hepatitis C drug pipeline. The market is betting one of Merck's hepatitis C competitors -- Johnson & Johnson (JNJ), Abbvie (ABBV), Bristol-Myers Squibb (BMY) or Gilead Sciences (GILD - Get Report) -- will come knocking on Achillion's door.
The FDA lifted a clinical hold on sovaprevir, Achillion's protease inhibitor, to allow higher dosing in hepatitis C patients. Achillion also announced the start of patient dosing in an early study of ACH-3422, a nucleotide polymerase inhibitor. The conventional thinking is that so-called "nucs" are the linchpin of hepatitis C combination therapy. Gilead' Sovaldi is a nuc and will likely generate $9-10 billion in sales this year. Idenix is developing a nuc, which is why Merck acquired the company.