Achillion Pharma slumps on hepatitis C drug data

NEW HAVEN, Conn. — Shares of Achillion Pharmaceuticals Inc. tumbled more than 18 percent Monday as Wall Street reacted to data from a clinical trial of its experimental hepatitis C drug, which is called ACH-1625.

Achillion reported preliminary data from a study of ACH-1625 on Saturday and clarified its report on Monday. It said 94 percent to 100 percent of patients with genotype 1 hepatitis C had a "complete response" after 12 weeks of treatment. That means the virus could not be detected in their blood.

The study compared during regimens including ACH-1625 and ribavirin and interferon, two standard components of hepatitis C treatment. On Monday the company clarified that 22 of the 58 patients in the study had completed all 24 weeks of treatment with the drugs.

The patients in the study had genotype 1 hepatitis C. That is the most common type of the virus, and it is the hardest to treat.

Achillion said it will present more data from the study later this year. The company also said it is planning to start a clinical trial combining ACH-1625 with another one of its drug candidates, ACH-3102. Achillion and several other drug companies are working to develop a successful all-oral treatment for hepatitis C.

In a client note published Sunday, JMP Securities analyst Liisa Bayko said the interim study results were "confusing" and noted there were some hints of safety concerns with the drug: some patients experienced temporarily elevated levels of liver enzymes. She added in a telephone interview that some of the drug's side effects increased as the doses of the drug increased.

Because patients with hepatitis C genotypes 2 and 3 typically need higher doses of drugs to treat their disease than patients with genotype 1, the data may indicate that ACH-1625 is a potential treatment for genotype 1 but not types 2 and 3, Bayko said. That would reduce the value of the drug and of Achillion: Bayko said most investors see the company as a buyout target.

Bayko downgraded Achillion shares to "Market Perform" from "Market Outperform."

William Blair & Co. analyst Y. Katherine Xu maintained an "Outperform" rating, saying it is hard to tell how the early data will reflect the full results of the trial. Xu said the data are "significant advances" for the company's drug candidates.

Shares of Achillion Pharmaceuticals fell $1.54, or 18.5 percent, to close at $6.75 as the markets slumped.