Vertex Pharmaceuticals (Nasdaq: VRTX) is expected to soon announce late-stage data on its hepatitis C treatment from the first of three key studies--and the Street is waiting with great anticipation, a Dow Jones report notes. Many anticipate the study data--expected by the end of June--will be positive, and they could help further gains as confidence grows in the drug's role in the lucrative but increasingly competitive hepatitis C market.
Although it has several promising pipeline products, Vertex's $7.7 billion market valuation is primarily tied to the success of telaprevir, Dow Jones reports. Telaprevir is likely to face competition from Merck's boceprevir, which is on a similar development timeline. However, in April 2009, Schering-Plough, now part of Merck, reported data showing that half of the patients receiving the experimental drug developed anemia.
Other companies developing hep C treatments include Bristol-Myers Squibb, Gilead Sciences and Roche.
Wells Fargo & Co. has initiated coverage on Vertex with a "Market Perform" rating and a valuation range of $38-$43. "Telaprevir is one of the most-watched drug development programs in healthcare, given its multibillion dollar potential. We are in agreement with the Street that a positive outcome for the trial is virtually a foregone conclusion and that telaprevir will be commercially successful," it says in a note, as quoted by American Banking News.
"However, given the high expectations being placed on trial outcomes, ...we believe it may be difficult for trial results to dramatically exceed expectations, which may be required to see significant share appreciation given current market conditions," it adds.
Last month, Vertex and Johnson & Johnson announced that telaprevir combined with older anti-viral treatments peginterferon and ribavirin cured 93 percent to 100 percent of patients with hepatitis C genotype 1 after 48 weeks of treatment.
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