An exciting new HIV drug from Down Under may reverberate here in the U.S.

On Monday, Australian biotech firm

Avexa

reported positive data from a phase IIb study of its drug apricitabine in patients with drug-resistant HIV.

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Avexa's stock is listed only on the Australian stock exchange, so it's not the most convenient or accessible investment for the average U.S. investor. But that won't stop Avexa from affecting the fortunes (and not necessarily in a good way) of smaller HIV drug companies, including

Achillion Pharmaceuticals

(ACHN) - Get Report

,

Panacos Pharamceuticals

(PANC)

and

Trimeris

( TRMS).

This latest clinical data appears to make apricitabine one of the most exciting unpartnered HIV drugs in development. That puts Avexa in the driver's seat when it comes to negotiating a potential partnership or acquisition, while simultaneously pushing companies such as Achillion, Trimeris and Panacos further back in the deal-making line.

Avexa owns worldwide rights to apricitabine, having acquired North American rights from

Shire

in January.

Apricitabine belongs to the current class of HIV drugs known as nucleoside reverse transcriptase inhibitors, or NRTIs, which are a key component of today's triple-combination HIV therapies. Avexa is developing apricitabine as the NRTI of choice for patients who have developed resistance to other drugs, including other NRTIs.

In the phase IIb data released Monday, patients taking aprictabine achieved a greater and statistically significant reduction in viral load compared with patients taking 3TC, a commonly prescribed NRTI owned by

GlaxoSmithKline

(GSK) - Get Report

. Patients enrolled in this 21-day study had drug-resistant virus, including a strain of the virus known to reduce the efficacy of certain NRTIs, including 3TC (also known as lamivudine).

Since NRTIs form the backbone of current HIV treatments, apricitabine has the potential to be an important component for any company seeking to create and market new HIV drug combinations. Tops on the list would be

Pfizer

(PFE) - Get Report

and

Merck

(MRK) - Get Report

, which could take a serious look at Avexa since apricitabine has the potential to combine well with each company's novel HIV drugs currently in development.

Pfizer's new HIV drug maraviroc is under review by the Food and Drug Administration right now, while Merck's new drug, Isentress, will be filed with the FDA shortly.

Johnson & Johnson

(JNJ) - Get Report

is another big drug company with an eye toward enlarging its footprint in HIV. The company recently received FDA approval for the protease inhibitor Prezista and has two other HIV drugs in its pipeline, TMC125 and TMC278.

Then there's GlaxoSmithkline, the once-dominant HIV player that has seen its market share eroded significantly by

Gilead Sciences

(GILD) - Get Report

. If Glaxo wants a new NRTI to replace 3TC and compete better against Gilead's Truvada, it may well look to Avexa for a deal.

While there is enough interest in HIV drugs for multiple deals, companies such as Achillion, which has elvucitabine, its own NRTI, in clinical trials, may have to wait longer before attracting attention from potential suitors. Achillion is currently running a phase IIb trial of elvucitabine in treatment-experienced patients -- a trial similar in design to that run by Avexa for apricitabine.

Panacos and Trimeris are in the same boat. Formulation problems with Panacos' experimental HIV drug beviramat have significantly delayed its phase II program and cast doubts on the drug's future. Last week, Trimeris disclosed that its current partner

Roche

gave up on a next-generation version of its HIV drug Fuzeon.

Both Panacos and Trimeris could use a strong partner to re-energize their HIV programs, but neither appears to have the near-term appeal of Avexa.

Adam Feuerstein writes regularly for RealMoney.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback;

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