Watch stocks you care about
The single, easiest way to keep track of all the stocks that matter...
Your own personalized stock watchlist!
It's a 100% FREE Motley Fool service...
The nice thing about hepatitis C drugs is that the efficacy tends to translate really well from early to late-stage trials. Companies with active phase 1 compounds just need to run the larger trials to make sure there aren't any safety issues.
And therein lies the problem. Safety can't be an afterthought.
Bristol-Myers Squibb (NYSE: BMY ) is down 8% today after announcing that it was suspending dosing in a phase 2 clinical trial testing of one of its hepatitis C drugs BMS-986094 because of a "serious safety issue." The company didn't disclose more in the press release, but a couple of news outlets are reporting that one of the patients in the trial suffered heart failure.
One patient doesn't prove causality. It's certainly possible that the patient would have suffered heart failure even if it wasn't on the drug. But Bristol did the right thing in stopping the trial to investigate further.
Unfortunately the right thing might kill BMS-986094's prospects even if it turns out the drug wasn't the cause. In my experience, investigations into the safety of a drug can take awhile; I'd expect something closer to a year than a month or two. A year is an eternity in the hepatitis C race.
Bristol-Myers has other hepatitis C drugs, including daclatasvir that has looked good to date. But with Gilead Sciences (Nasdaq: GILD ) not wanting to partner with Bristol-Myers, the pharma's best hope was to try a combination of daclatasvir and BMS-986094. That plan is out for now.
The safety issue is good news for Gilead, Idenix Pharmaceuticals (Nasdaq: IDIX ) , and Vertex Pharmaceuticals (Nasdaq: VRTX ) , which all have drugs in the same class as BMS-986094. That assumes, of course, that the issue isn't a class effect that will affect all nucleotide polymerase inhibitors.
My guess is that the problem probably won't extend to the other drugs -- it isn't even clear if there's a problem at all -- but let's wait for the safety data from a larger population before we get all excited.