novartis-$400m hep c deal, page-6

The explosion of new drugs for HCV in the last 2 years is unprecedented in viral hepatitis, and somewhat bewildering to keep up with. However, with regards to HCV, as I've pointed out before, I wouldn't be holding my breath for BIT225 to be significantly involved. As the Gilead trials appear to be suggesting, good old CHEAP ribavirin and a polymerase inhibitor appear to be a large part of the answer to an all-oral regimen. If a third agent needs to be incorporated, it is likely that will be a protease inhibitor as these are well-studied, very potent and effective. This would be my impression to date given recent announcements, though of course it is a fast moving area and new results from particularly the Gilead ELECTRON trials may change this impression in coming months.

BIT225 I think is best suited as an HIV drug where the viral loads are lower and there does appear to be a reservoir effect. Interestingly, a large part of the effect on Gilead's share price last week probably related to a study reported earlier in the week demonstrating that in the longer term, tenofovir appears to cause renal impairment in HIV patients. As tenofovir is an HIV mainstay (and one of the jewels in Gilead's crown), it does mean a potential shake-up in HIV regimens which will benefit newer drugs (the 'closed door' will be opened again).

As far as buying BIT, my strategy would probably be to purchase during the mid to latter stages of an HIV phase II trial assuming the upcoming phase I results look promising. Of course there will be swings of the pendulum between now and then, but phase II trials tend to be where strong uptrends in price occur.