Gilead HIV triplet wins approval, prompts GSK-backed patent lawsuit
- Gilead Sciences Inc. received a broad approval from the Food and Drug Administration Wednesday for its triple combination HIV treatment Biktarvy, an advantage that will surely help the big biotech as it competes for market share against rival GlaxoSmithKline plc.
- Biktarvy comes as a once-daily tablet cleared for adults with HIV who have no antiretroviral treatment history. It's also indicated to replace the current antiretroviral regimen in patients who have been virologically suppressed on a stable antiretroviral regimen for at least three months and have no history of treatment failure or resistance to the individual drugs that make up Biktarvy.
- Regulators said Biktarvy doesn't have to be taken with food, unlike GSK's recently approved HIV doublet Juluca. However, Gilead's drug carries a black box warning for post treatment acute exacerbation of hepatitis B, whereas Juluca isn't encumbered by such a warning.
Antiviral drugs have gotten good. So good, in fact, that newer treatments are essentially curing the diseases they target, as seen with Gilead's hepatitis C remedy Sovaldi (sofosbuvir). Yet the potent power of those medicines has resulted in fewer patients in need of treatment, weakening returns for drugmakers in the space. Revenue from Gilead's hep C business, for instance, fell 40% in 2017.
The big biotech is banking on innovation in HIV, liver disease and — with its $12 billion acquisition of Kite Pharma Inc. — cancer to offset the declines in hep C. Already, Gilead is seeing success in that first category; its HIV and hepatitis B drugs registered sales of $14.2 billion in 2017, up 10% from the previous year due to uptake of Genvoya (elvitegravir/cobicistat/emtricitabine/tenofovir alafenamide), Descovy (emtricitabine/tenofovir alafenamide) and Odefsey (emtricitabine/rilpivirine/tenofovir alafenamide).
The FDA's approval of Biktarvy, which combines a novel integrase strand transfer inhibitor (bictegravir) with the active ingredients from Descovy, represents another blockbuster opportunity. Jefferies analyst Michael Yee estimates the tablet will snag at least $850 million in 2018, mostly from new patients just starting HIV treatment, and reach peak annual sales of $3 billion.
"We think launch preparations should be relatively seamless and allow for a quick commercial uptake given the company's familiarity with [the emtricitabine/tenofovir alafenamide] component, and GILD believes launch revenues could exceed that of Genvoya, which recorded revenues of $966M during its first four quarters of launch," he wrote in a Feb. 7 note.
The rollout won't be obstacle-free, though. ViiV Healthcare Co., an HIV drugmaker majority owned by GSK, promptly filed patent infringement lawsuits in the U.S. and Canada against Gilead following Biktarvy's approval. The lawsuits claim bictegravir infringes on the intellectual property related to dolutegravir.
"Intellectual property protections are critical for the life-sciences industry, allowing companies to make a return on their investment, which in turn enables research-based companies to put new funding into research and development," ViiV said in a Feb. 8 statement. "It is this cycle which continues to result in the development of new and much needed treatments for people living with HIV. ViiV Healthcare will therefore seek financial redress for patent infringement."
The move is largely a defensive one for GSK, which is doubling down on core therapeutic areas such as respiratory disease and HIV as it braces for generic competition to its flagship drug Advair (fluticasone propionate/salmeterol).
The British pharma reported £4.35 billion (about $5.9 billion) worth of sales for its HIV products in 2017, up 22% from the previous year due to strong performances from Triumeq (abacavir/dolutegravir/lamivudine) and Tivicay (dolutegravir). Juluca (dolutegravir/rilpivirine), the first two-drug regimen for maintenance treatment of HIV-1, gained approval in November, and sported £5 million (about $6.8 million) in sales by year's end.
In a separate note, Yee explained the ViiV lawsuits weren't much of a shock and likely won't have a significant financial impact on Gilead. Should the biotech ultimately lose out in court, Yee predicts the two companies will reach a settlement wherein ViiV gets a "modest royalty" on Biktarvy sales.
Even with that outcome, the lawsuits may sting ViiV and GSK in the near-term.
"Some bulls think that patent infringement cases like this seek to keep competition away from the market and keep prices high," Yee wrote. "Thus, physicians or payors may have initial backlash and view this negatively against the plaintiff (ViiV). Although, to be it clear, it does not appear that ViiV is seeking an injunction, just financial redress (but the financial implications are minimal)."
Gilead stock closed at $82.76 per share on Wednesday, up 3%. GSK's shares, meanwhile, were essentially flat, trading at $36.03 per share.
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