VERTEX PHARMA - Unlikely to Tap the Cystic Fibrosis market Beyond G551D Mutation!
Vertex (VRTX) strategy to tap the larger Cystic Fibrosis market of ΔF508 mutation by combination of a potentiator (VX-770) and corrector (VX-809) of the underlying genetic defect in CF pts did not yield data (reduction in sweat chloride of -9.10 mmol/L (p<0.001), no data related to improvement in lung function) as promising as VX-770 alone in CF pts with G551D mutation (% change from baseline in predicted FEV1: PBO adjusted: @ 24-wk: 10.6% (p<0.0001); @ 48-wk: 10.5% (p<0.0001), sweat chloride improvement: @ 48-wk: reduced below 60mmol/L from baseline of 100mmol/L). We expect the stock to remain under pressure for the next 6-9 months as the marketing dynamics of the recently launched PI’s (Merck’s Victrelis versus Vertex’s Incivek) emerge. Risk reward profile is not favourable for the VRTX as, aggressive marketing from could increase the pressure as the expectations from Incivek is very high and any shortfall will result in a downside in near term. Increasing competition from Interferon free drugs could threaten the PIs market share in long run. Announced partnership with Alios (US, Private, PMIs’ ALS-2200/ALS-2158, PC) puts VRTX in the “IFN free race” there is little disclosed on the molecules profile to assign significant value to the deal. We reiterate our Market Perform rating on VRTX with a revised TP of $55 (Previous $64).
COMPANIES MENTIONED
VERTEX, VRTX
VERTEX, VRTX
