- Vertex Pharmaceuticals reported positive clinical results for three of its cystic fibrosis (CF) triple combination treatments on Thursday, reinforcing the idea that at least one of them could be a game-changing therapy for patients with the rare disease, as well as further validating the company's pivot away from hepatitis C drug development.
- The drug combos all included Vertex's tezacaftor and Kalydeco (ivacaftor), and then either VX-152, VX-440 or VX-659. Two separate mid-stage studies tested the VX-152 or VX-440 combos in CF patients with either one F508del mutation and one minimal function mutation (F508del/Min) or with two F508del mutations. A third, early-stage investigation evaluated VX-659 just in F508del/Min patients.
- F508del/Min patients treated with VX-152, VX-440 and VX-659 had improvements of 9.7%, 12% and 9.6%, respectively, from their baseline percent predicted forced expiratory volume (ppFEV) — a measure of lung health. Participants with two F508del mutations, meanwhile, demonstrated respective improvements of 7.3% and 9.5% from baseline ppFEV when treated with VX-152 and VX-440.
Vertex used to be a heavyweight in the hep C space. Its drug Incivek (telaprevir) raked in nearly $1.2 billion in 2012. But the entry of Gilead's Sovaldi (sofosbuvir), essentially a cure for the disease, in 2013 effectively crushed Incivek uptake, leading Vertex to pull the drug from market in 2014.
With its hep C franchise awash, Vertex doubled down on cystic fibrosis. It already had Kalydeco, a transmembrane conductance regulator green lit in 2012, and soon added Orkambi (lumacaftor/ivacaftor). In the first quarter of this year, net revenues from those products reached $186 million and $295 million, respectively.
What's more, Vertex has refined its pipeline to focus in on CF and specialty diseases. Earlier in 2017, the company sold off five cancer meds to Merck KGaA and picked up another drug from Concert Pharmaceuticals for $160 million upfront.
Key to Vertex's strategy are combo treatments for CF, which is part of the reason why Tuesday's announcement is so major. Not only does it increase optimism that new therapies for a wider pool of patients are on their way, but it solidifies the company's deep dive into the rare disorder.
In a July 18 note, investment firm Jefferies said Vertex could "become the fastest-growing large cap biotech," and reach peak revenues from its CF drugs of more than $7 billion. Investors got the message loud and clear. Vertex stock opened at $161.80 per share on Wednesday, up 22% from Tuesday's close — an increase that bumped the company's market cap up about $8 billion.
Importantly, Vertex is still evaluating which combos to take into late-stage pivotal testing, which is slated to begin in the first half of 2018.
Currently, there are about 30,000 CF patients in the U.S. Orkambi and Kalydeco can treat about 40% of the 75,000 CF patients in Australia, Europe and North America, according to Vertex.
"Patients with minimal function mutations have been waiting for a medicine to treat the underlying cause of their disease, which makes these data showing pronounced improvements in lung function particularly important," Rowe said in a statement. "It's also encouraging to see that the addition of a next-generation corrector may lead to substantial additional benefits for patients with two copies of the F508del mutation, who were already receiving tezacaftor and ivacaftor."
Vertex CFO Ian Smith confirmed that profitability and cash flows are going to clearly increase more now with addition of potential triple combinations and an expansion of the CF market from being able to treat 50% of patients to treating about 90% of patients, noted Jefferies analyst Michael Yee.