Macro Tsimmis

intelligently hedged investment

Vertex (VRTX) update #23

Posted by intelledgement on Mon, 09 Feb 09

Our biotech play, Vertex Pharmaceuticals (VRTX), announced their 4Q08 and full 2008 results today, and provided guidance for 2009. Excluding stock-based compensation and restructuring and other non-recurring charges and gains, the company lost $397.5 million, or $2.83 per share in 2008, compared to a loss of $324.8 million, or $2.52 per share, for 2007. The increased loss is largely attributable to decreased total revenues, an increase in total operating costs and expenses to support telaprevir’s global Phase 3 registration program and commercialization, and a reduction in net interest income. In 2009, the company expects a loss in the range of $400-to-$435 million, excluding restructuring charges and stock-based compensation expense.

Results from two of the three Phase 3 currently-underway trials of telaprevir, the company’s Hepatitis C drug, are due by mid-2010. Those trials involve treatment-naive patients while the third study focuses on patients who have failed to respond to the current standard of care treatment; results from that study are expected in the latter half of 2010. Phase 2 results obtained in 2008 indicate that treatment with telaprevir in combination with the current SOC regimen improves the cure rate from 40%-to-50% achievable with the current SOC to around 70% while potentially decreasing the course of treatment from 48 weeks to 24—important because the treatment is debilitating and more patients are likely to complete a 24-week course than would tolerate 48 weeks. Also ongoing in Europe in conjunction with partner Tibotec is a Phase 2 study testing twice-daily telaprevir dosing (the USA Phase 3 trials are all based on thrice-daily dosing regimens).

The company also expects to begin Phase 3 trials of their cystic fibrosis CFTR potentiator compound by mid-2009. Phase 2 results last year were promising, but the market here is limited—there are 30,000 cystic fibrosis patients in the USA and this Phase 3 trial is focused on those who carry the G551D mutation, present in approximately 4% of patients.

Previous VRTX-related posts:

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