Skip to main content



) --

Vertex Pharmaceuticals'


new hepatitis C drug Incivek is outselling Victrelis, a rival drug from



, in the early weeks of their respective commercial launches.

U.S. regulators approved




in May just 10 days apart, which means Vertex and Merck began marketing the competing hepatitis C drugs essentially at the same time. Investors rarely get to watch companies launch two similar drugs simultaneously -- particular two drugs tapping into a multi-billion dollar market like hepatitis C -- so investors are paying close attention to the early prescriptions written for Incivek and Victrelis.

So far, Vertex is beating Merck, which means the marketing battle between Incivek and Victrelis is playing out largely as expected.

For the week ended June 17 (the most current data available), doctors wrote 460 prescriptions for Vertex's Incivek compared to 160 prescriptions written for Merck's Victrelis, according to weekly prescription data compiled by IMS Health. Weekly IMS drug prescription data tracks retail pharmacy, mail order and long-term care distribution channels.

Scroll to Continue

TheStreet Recommends

That puts Incivek's market share at 75% compared to Victrelis' 25% with about five weeks of prescription data available. Even before the two drugs launched, investors were expecting Incivek to garner more prescriptions, with some analysts forecasting a 75% market share split for Incivek at peak.

The current consensus 2011 sales forecast for Incivek is $490 million, according to the sell-side analysts who cover Vertex. Buyside investors are expecting more. A survey of 188 investors in early June yielded a 2011 consensus sales estimate of $568 million, including $43 million in the second quarter that ends June 30, according to ISI Group biotech analyst Mark Schoenebaum, who conducted the survey.

Bank of America Merrill Lynch, through IMS, is tracking daily prescriptions of Incivek for those investor clients who are totally obsessed with the launch of the new hepatitis C drugs. Those daily IMS reports, culled from prescriptions reported by retail pharmacies only, also show Incivek topping Victrelis to date.

Doctors are showing a preference for Incivek over Victrelis so far, but that advantage isn't yet translating into a higher Vertex stock price. At Monday's close of $48.73, Vertex is down 15% from May 23, the day Incivek was approved, and down 21% from the stock's 52-week high reached on May 12.

Even with a depressed stock price, Vertex carries a $10 billion market valuation, which illustrates quite well investors' high expectations for a successful Incivek launch. Vertex is counting on Incivek to carry the company to profitability for the first time. Merck, on the other hand, isn't as reliant on Victrelis financially.

"We're getting great feedback from the field. The launch is going well and is as expected," said Vertex spokesman Zach Barber. Vertex declined to discuss the Incivek launch in more detail until the company reports second-quarter financial results in late July.

Merck, likewise, said it was happy with the early Victrelis launch.

"Physicians are excited to have new treatment options for hepatitis C and they are prescribing Victrelis," said Denise Allen Williams, Merck's chief marketing officer for the U.S.

In addition to fielding sales forces to target doctors who treat hepatitis C patients, both Vertex and Merck have invested in public education and consumer campaigns to raise awareness of hepatitis C and prod people at risk to be tested.

Rocker and hepatitis C patient Greg Allman of the Allman Brothers Band is featured in one of Merck's public health campaigns. Allman had a liver transplant one year ago due to severe damage from chronic hepatitis C infection. Allman will play a benefit concert on July 27, the eve of World Hepatitis Day.

Nearly 3.2 million Americans have chronic hepatitis C virus infection, a potentially serious disease that can damage the liver over time and lead to cirrhosis, end-stage liver disease and liver cancer. Approximately 60-80% of people infected with chronic hepatitis C virus do not have symptoms.

The old gold-standard treatment regimen for hepatitis C -- 48 weekly injections of interferon and daily doses of oral ribavirin -- cured about 40% of patients. Adding Victrelis to that regimen shortens treatment duration for some and improves cure rates to more than 60%. Likewise, Vertex's Incivek will shortens treatment and boosts cure rates to as high as 80%.

Higher cure rates are expected to expand the pool of hepatitis C patients seeking treatment. Doctors queried in early June said they expect the volume of treated hepatitis C patients to more than double in the first year of the Incivek and Vicrelis launches, according to a survey conducted by Leerink Swann released Monday.

The demand for hepatitis C treatment, which could triple in the second year of the Incivek and Victrelis launches, is being driven largely by patients who were treated unsuccessfully with older hepatitis C drugs but who are now coming back for retreatment with the new drugs, Leerink Swann said.

The same survey found doctors preferring Incivek over Victrelis largely due to the former's superior efficacy and ease of use. Both drugs are viewed equally safe and tolerable, according to the Leerink Swann survey, which gathered responses from 31 doctors who specialize in treating hepatitis C patients.

--Written by Adam Feuerstein in Boston.

>To contact the writer of this article, click here:

Adam Feuerstein


>To follow the writer on Twitter, go to


>To submit a news tip, send an email to:


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

click here

to send him an email.