What: While many healthcare stocks were getting walloped in July as a result of the Greek financial crisis, Enanta Pharmaceuticals (NASDAQ:ENTA) was among the few strong performers in the sector, with its share price actually climbing double digits last month:
Enanta's ability to defy the weight of the global economic turmoil last month stemmed directly from the approval of AbbVie's (NYSE:ABBV) Technivie on July 24, a genotype 4 hepatitis C treatment co-prescribed with ribavirin and indicated for patients without cirrhosis of the liver. Enanta developed one of the two direct-acting antivirals, paritaprevir, which is used in Technivie, as well as AbbVie's other hep C combo therapy Viekira Pak, and it's therefore entitled to milestone and royalty payments on net sales of the drugs.
So what: According to AbbVie and Enanta, Technivie is the first all-oral, interferon-free, direct-acting antiviral treatment approved in the U.S. for adult patients with genotype 4 hepatitis C. Presently, Gilead's wonder drug Sovaldi is approved in genotype 4 patients, but in combination with both peginterferon alfa and ribavirin.
Now what: As you might expect, Gilead is also closing in on all-oral, interferon- and ribavirin-free treatment regimen via its combo pill Harvoni. Last April, the biotech released intriguing data from a midstage study showing functional cure rates of 95% for genotype 4 patients after receiving Harvoni.
Perhaps most worrisome for AbbVie and Enanta's Technivie, Harvoni proved effective in patients with and without cirrhosis. So, while Technivie did have slightly higher functional cure rates in its pivotal late-stage trial (100%) in genotype 4 patients, Harvoni might come without the serious adverse effects induced by ribavirin (depending on its label for this indication), and could potentially be used in a wider patient population. Put plainly, Technivie's approval may not turn out to be much of long-term value driver for Enanta or its partner AbbVie. Stay tuned.