More Hep C Drug Abstracts Leak Ahead of EASL Confab

BOSTON ( TheStreet) -- More hepatitis data supposedly kept under wraps by the European Association for the Study of the Liver (EASL) in advance of next week's closely followed annual meeting has made its way into the hands of Wall Street investors.

Fortunately for EASL, the leaked research abstracts, including one describing the important "Electron" study of Gilead Sciences' ( GILD) hepatitis C drug GS-7977, doesn't contain new information and therefore isn't particularly stock moving.

On Tuesday, an investor who asked to remain anonymous emailed me three research abstracts involving hepatitis C drug data from Gilead Sciences and Bristol-Myers Squibb ( BMY). All of the abstracts were supposed to be embargoed and therefore not publicly available, according to EASL rules.

One of these abstracts, titled "Electron: Once Daily PSI-7977 Plus RBV in HCV GT1/2/3" is the subject of intense investor interest because it will help assess the efficacy of Gilead's most important hepatitis C drug, acquired through the $11 billion acquisition of Pharmasset.

EASL officials confirmed the authenticity of the leaked research abstracts via email but requested that specific information contained in the abstracts not be disclosed. I'm abiding by EASL's request because the leaked abstracts are not much more than placeholders containing early, incomplete and previously announced data that will only be updated at the EASL meeting April 18-22.

The embargoed abstract for Gilead's Electron study, for example, describes but doesn't contain any specific data on response rates involving GS-7977 and treatment-naive, genotype 1 hepatitis C patients. The performance of GS-7977 in this group of hepatitis C patients is among the most highly anticipated data presentations expected at the EASL meeting.

The EASL meeting is where Gilead Sciences, Bristol, Abbott ( ABT), Idenix Pharmaceuticals ( IDIX), Vertex Pharmaceuticals ( VRTX) and Johnson & Johnson ( JNJ) are among the companies expected to present new clinical data on experimental hepatitis C therapies. Therefore, the meeting is as vitally important to hepatitis C doctors and patients as it is to investors.

How a select set of confidential, embargoed hepatitis C drug abstracts came into the hands of some Wall Street investors hasn't been fully explained. The blame most likely lies with EASL, which apparently failed to wall off the select set of abstracts when the group posted most of the abstracts online April 4. EASL later realized its error and was able to yank the embargoed abstracts from its web site, but not before some people, including some investors, were able to download them.

On Monday, a sell-side analyst working for Jefferies published a research note describing data from another leaked EASL abstract concerning a mid-stage study of Bristol's daclatasvir and Gilead's GS-7977.

The multiple research abstract leaks are another black eye for EASL, which has come under criticism for the way it handles potential market-moving hepatitis C clinical data in advance of its annual meeting. EASL's original plan to selectively disclose abstracts to its members or registered attendees of the annual meeting -- a group which includes hedge fund/mutual fund portfolio managers and sell-side analysts -- was criticized as misguided, unfair, unworkable.

EASL quickly reversed its policy, choosing instead of make most of the research abstracts for its meeting publicly available to everyone on April 4. But at the same time, EASL chose to keep 20 abstracts under embargo until the start of the meeting.

That plan, too has gone awry. EASL is leaking like a sieve.

--Written by Adam Feuerstein in Boston.

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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.

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