Bristol-Myers picks up another 'breakthrough' trophy in hep C cocktail showdown

Bristol-Myers Squibb has picked up its second "breakthrough" drug designation for a daclatasvir-based, all-oral combo for hepatitis C from the FDA, potentially shaving some regulatory time off its late-stage program as developers scramble to hijack market share from Gilead's ($GILD) pioneering approach.

The FDA tapped a combination of daclatasvir (an NS5A replication inhibitor) and asunaprevir (their NS3 protease inhibitor) for genotype 1b patients. Last spring their triple drug cocktail, which also includes BMS-791325, an NS5B non-nucleoside polymerase inhibitor, was tapped as a breakthrough for genotype 1 patients.

Bristol-Myers ($BMY) has been hustling along with its various combos as Gilead pushes Sovaldi into the marketplace at a pricey $84,000 for a 12-week treatment course. Gilead already has its sights set on a filing for a combination of its own--Sovaldi and ledipasvir--which would further crack open the multibillion-dollar market waiting for interferon-free hep C drugs. And AbbVie ($ABBV) has been hurrying along with its own combination cocktail for the disease. All these efforts have posted some solidly promising efficacy results in key studies.

Payers have been paying particularly close attention to this late-stage cocktail race as physicians warehouse various patient groups—divided by genotype--for the right therapy. Interferon injections frequently have a cruel and intolerable impact on patients, leaving the field wide open to new combination therapies with a high likelihood of success in quelling the virus. The pioneers are being priced high, and payers would like to see some competition start to bring prices down quickly.

A second breakthrough designation for BMS at this stage may not sound like much at first glance, but any advantage on the regulatory front could pay back handsomely with an earlier entry into the market. Sovaldi earned $139 million in the first three weeks it was on the market at the end of December. That left analysts projecting sales of $5 billion to $6 billion in 2014, which would make it one of the most successful new drug launches in industry history.

- here's the release