Category Archives: Gilead

Gilead and the silly spat over Solvadi pricing

Dear readers and clients of,

Sunday’s NY Times did us the favor of moving the discussion about Sovaldi from treatment of HCV to HCV cure ( It’s about time…

We present a compelling report from Dr. Paul De Santis on the valuation and future of Gilead Sciences (GILD): Alpha BioPharma Evidence-Driven Rebuttal to Morgan and Goldman, Summary & Marketing Report.

On the heals of their impressive quarterly earnings and heading toward a transformative year, Gilead faces fundamental issues. Dr. De Santis uses comprehensive and relentless analysis, deeply vetted, to trace the paths Gilead may take, and argues that bearish analyses from Morgan Stanley, Goldman Sachs and others have led the Street to fundamentally undervalue this innovative, aggressive and ultimately triumphant company.

In the full report Dr. De Santis covers critical topics including

      M&A:  GILD will have the capacity to repurchase their entire market cap by 2020.

      HCV PRICING: Sovaldi pricing pressure will ease as the discussion shifts to cost per cure, not cost per treatment. Further, the emerging HCV competition (MRK, BMY, ABBV) has little incentive to discount price – consensus forecastsrely on premium pricing.

      HCV, EMERGING MARKETS: Sovaldi has first mover advantage in 26 Emerging Markets. The pricing model/methodology presented in this report was confirmed by GILD management – no sell-side firm has put together such a comprehensive model on E.M. 

      PIPELINE: Gilead will leverage $100B in FCF to accelerate their transformation into a premier Oncology franchise

      SUSTAINABILITY: As we’ve seen in other chronic diseases (MS, RA) the arrival of transformative therapies will drive market expansion over many years

If you maintain or trade positions in GILD, it’s competitors, partners or takeover targets I kindly suggest you acquire his detailed 145 page report. Pricing and download information are available directly from Dr. De Santis at In addition to the report Dr. De Santis will send you real-time updates from the critical upcoming medical conferences (ASH, the AASLD Liver conference, CHEST, and ESMO) and important updates related to GILD and its’ competition through year-end.

We support this report based on the very high quality and content and our respect for the work of Dr. De Santis and his firm AlphaBioPharma.

To be fair, we are also long GILD.

Oncology drug development questions for 2014: Combination therapies for B cell lymphoma

Part 1 – Ibrutinib and the development of combination therapies for B cell lymphoma

For physicians, patients, investors etc, major medical conferences are a way to check in on the progress of a company’s drugs in the context of the medical communities response to the data, i.e. the buzz. Negative buzz is generally pretty straightforward, reflecting poor results or unexpected toxicity in a clinical trial. Positive buzz should be (and often isn’t) more nuanced, as positive data, while great to see, need to be placed into the context of evolving clinical practice and the ever-present competition for patients. Results, positive or negative, need to be vetted for robustness: clinical trial stage, sample size, design; endpoint design; therapeutic window (the dose range between efficacy and toxicity); and duration of response.

Last year saw extraordinary advances in the treatment of B cell lymphoma, particularly the Non-Hodgkin Lymphomas (NHL) that include well known cancers like Chronic Lymphocytic Leukemia (CLL), Mantle Cell Lymphoma (MCL), indolent NHL (iNHL) and many others. This advances included small molecule therapeutics that target critical drivers of lymphoma cell proliferation and survival, novel antibodies (“naked”, enhanced, payload carrying), ex vivo modified patient T cells that attack lymphomas upon reinjection, and a variety of other modalities. It was interesting to see that the companies getting the most buzz varied during the year, with different companies “winning” different conferences. Be assured that in this context, winning reflects wins for the stock price! Winning in the medical marketplace is a whole different story.

With the medical marketplace in mind, a reasonable question for 2014 pops up when you step back and look at the breadth of the B cell lymphoma therapeutic landscape.

How will biopharmaceutical companies, physicians, and payers develop and use combinations of these therapies?

Lets think about the possible combinations. The most obvious are those that we are already seeing widely used, such as the combination of a small molecule inhibitor with a tumor-targeting antibody. One example is the combination of ibrutinib, a BTK inhibitor, and rituximab, an anti-CD20 monoclonal antibody. Ibrutinib was approved for treatment of relapsed/treatment refractory (rr) MCL in November 2013 under the brand name Imbruvica, and approval for rrCLL is expected soon (these indications were filed for approval together, in August 2013). Patients with relapsed/refractory small lymphocytic lymphoma (SLL) were included in the CLL arm of the clinical trial.

CLL is a good example of the power of combination therapy. Rituximab monotherapy in rrCLL/SLL produced overall response rates (ORR) in the range of 55% and a complete response rate (CR) of somewhere under 10%, depending on the trial. Note here that ORR and CR refer to assessments of tumor burden at a specific and predetermined time after treatment is initiated. A CR does not indicate a cure but rather is a measure of the degree of efficacy. The ORR and CR measurements are most meaningful when presented in the context of duration of response (DOR) or in the context of progression-free survival (PFS) or overall survival (OS).

Monotherapy of rrCLL/SLL with ibrutinib produced ORRs ranging from 70-80%, with CRs ranging from 0 – 10%. Duration of response was good, and there was a measurable impact on PFS. There are different classes of rrCLL patients, based on cytogenetic status. High risk CLL patients commonly carry a deletion on chromosome 17 (del17p) and/or other abnormalities. Such mutations predict poor prognosis for these patients. Last April, the FDA granted Ibrutinib Breakthrough Therapy Designation for high-risk rrCLL/SLL del17p patients based on achievement of a 50% ORR in these patients when given ibrutinib monotherapy.

Now to the combination of ibrutinib and rituximab (and a chemo agent, bendamustine). As discussed in earlier coverage of the American Society of Hematology Annual Meeting (ASH), linked here, treatment of high-risk CLL patients with the combination therapy produced an ORR of 95%, with 78% maintaining response through 18 months. While only 10% of the responses were designated CR, the long duration of the partial responses (PR) was a dramatic result.

The cost of Rituxan treatment for B cell lymphoma is generally quoted at ~10K/month but billed to insurance at about 5K monthly, so we are somewhere between 60-120K per year per patient in the US. Imbruvica will cost 130K per year per patient in the US. Note here that neither therapy, given alone, is considered curative. We don’t know yet what the durable remission rate will be for the combination therapy, where we define durable remission as no detectable disease (in the blood, lymph nodes, bone marrow) without maintenance therapy. Curative treatment means no disease in a patient who no longer requires drugs.

So it’s fair to say that these combination therapies will be very expensive and may need to be used for a long time. Given the current climate of cost control, especially outside of the US, what are companies doing to anticipate eventual pushback on premium pricing?

Just a quick reminder that Imbruvica (ibrutinib) is a Pharmacyclics/Johnson&Johnson (J&J) product and the Rituxan is a Roche product and further, that Roche has a next generation anti-CD20 antibody, obinutuzumab, recently approved for the treatment of CLL (including as first line treatment), under the brand name Gazyva. This antibody given in combination with a cheap chemotherapy agent, chlorambucil, produced an ORR = 78% and a CR of 28% in the phase 3 trial. This antibody was significantly better than Rituxan (rituximab) plus chlorambucil in the same clinical trial (ORR = 65%, CR = 7%). The trial was done in rrCLL patients including high-risk patients defined as del17p.

Another anti-CD20 antibody, ofatumumab from GSK, has been approved for second-line use in rrCLL. This drug, priced at 120K yearly, ran into reimbursement pressure in Europe and the UK as not showing sufficient benefit to justify the price. This is a hint of price pressures to come.

This is where I think things get really interesting. I spent some quality time on, trying to understand how companies competing in the B cell lymphoma space are looking ahead, the assumption being that one can do this by looking at the trials planned or underway for the top tier drugs. Many of the oral drugs in advanced development for B cell lymphomas are reviewed here.

Nearly all advanced oral drugs for B cell lymphoma have trials underway or planned with an anti-CD20 antibody. Most of these trials are done with rituximab, probably just reflecting the wide availability of this antibody. Perhaps some companies are sticking with rituximab in the belief that generic biosimilar forms of this antibody will become available in Europe (where it is now off-patent) and in the US (where patent protection expires in 2018), which may make combination therapy more widely available. The rituximab trials are not done in collaboration with Roche, with one notable exception which we will get to later.

There are 11 clinical trials listed as active that include ibrutinib with rituximab either alone or with various other agents. Some of these trials have already read out results:

NCT01980654210/24/2013rituximabuntreated FL
NCT0152051921/25/2012rituximabhigh risk CLL, SCL
NCT0161109035/15/2012rituximab/bendamustinerrCLL, rrSCL
NCT0177684031/24/2013rituximab/bendamustineuntreated MCL
NCT01479842111/1/2011rituximab/bendamustinerr DLBCL,MCL,iNHL
NCT0188687236/24/2013noneuntreated CLL
v rituximab/bendamustine
NCT01974440310/28/2013R-CHOPrr iNHL
v rituximab/bendamustine
NCT0188685916/24/2013lenalidomiderrCLL, rrSCL
NCT0182956814/9/2013lenalidomide & rituximabrrFL
NCT0195549919/27/2013lenalidomide & rituximabrr iNHL

Note that FL is follicular lymphoma and DLBCL is diffuse large B cell lymphoma. DLBCL-ABC is a subtype. These are all types of B cell lymphomas. R-CHOP is rituximab plus a standard mixture of chemotherapeutic agents, and I may or may not have defined this correctly, suffice to say if it says CHOP then there is a potent mix of chemo being given; “v” means versus, that is, it is a comparator arm.

There are another seven or eight single agent ibrutinib trials also, but I did not include those here, so what we see all together is a full court press of clinical trials designed to show benefit of ibrutinib in multiple different B cell lymphomas, as first line or second line therapy. These trials will produce a tidal wave of data that, if positive, will by their sheer volume place ibrutinib at the top of the heap of B cell lymphoma oral agents. So, yes, I’m betting on Pharmacyclics (stock symbol PCYC) and J&J to win the marketplace, at least for the near term.

Ibrutinib development does not stop there. There are three trials with lenalidomide, also known as Revlimid, approved as second line therapy for multiple myeloma (MM). A monotherapy trial of lenalidomide in CLL was halted last year due to an increase in deaths seen in the active arm. Even at a reduced dose (I’m guessing here) the use of this agent plus ibrutinib plus rituximab seems risky. Also, the drug is owned by Celgene. So why conduct trials with lenalidomide at all? The answer to that question will be found in the list of clinical trials for CC-292, Celgene’s BTK inhibitor under development for B cell lymphoma.

But just to finish with ibrutinib. Here are the rest of the active clinical trials I could find:

NCT020131281,212/11/2013ublituximabCLL, MCL
NCT0157870734/11/2012v ofatumumabrrCLL
NCT0184172321/24/2013noner Hairy Cell leukemia

Ublituximab is a new anti-CD20 antibidy from TG Therapeutics and the clinical trial is being run by that company, not by J&J/PCYC. In contrast the ofatumumab trials, which are “active but not recruiting” are sponsored by Pharmacyclics.

Finally, just some tidbits. Ibrutinib presentations recently have included studies in some interesting new indications, particularly MM. There are two MM trials shown here, the second one being run in collaboration with Onyx Pharmaceuticals, whose proteosome inhibitor carfilzomib, has been approved for treatment of rrMM under the name Kyprolis.

I suspect we will see many more such collaborative efforts as the field matures.

Next up we will look at the efforts of two of the compounds seeking to compete with ibrutinib, Gilead’s idelalisib and Celgene’s CC-292.

Stay tuned.

SnapShots, American Society of Hematology Abstracts – Part 3

Part 3. Additional studies featuring small molecule inhibitors for Chronic Lymphocytic Leukemia and other B cell lymphomas.

November 18, 2013

The American Society of Hematology Meeting will take place in New Orleans, December 7 – 10, 2013. The abstracts are available at

Lets start with other compounds targeting Btk, PI3K and related kinases in the BCR signaling cascade. In part 1 of this series we looked at Idelalisib, a PI3Kdelta (d) inhibitor, and in part 2 we reviewed Ibrutinib, a Btk inhibitor. In both of those reviews we focused on data from CLL trials, as CLL is the most common B cell malignancy.

Other Btk inhibitors are moving through the clinical development process. Abstract #1630 presents Phase 1 data for relapsing/refractory Non-Hodgkin’s Lymphoma (NHL) patients, including CLL and SLL patients. CC-292 is a covalent inhibitor of Btk developed by Avila and acquired, along with that company, by Celgene. The Phase 1 is a dose escalation/dose schedule trial, with various doses between 125 and 1000 mg given once (qd) or twice (bid) a day. The maximum tolerated dose (MTD) was not reached and AEs were as usual in these trials, with cytopenias being the most common toxicity. The patients enrolled were rrCLL/SLL with high-risk characteristics, as were outlined in Part 1. Of 83 patients enrolled, response data are shown for the 55 efficacy-evaluable patients who had at least a PR (so, 66%). These patients were treated at the highest 4 dose levels: 750 mg qd, 1000 mg qd, 375 mg bid and 500 mg bid (qd = once daily and bid = twice a day). Across these 4 dose groups the ORR = 60% and all responses were PR. Some patients showed evidence of reduction of nodal (lymph node) disease as seen by a reduction in size of the nodes. Abstract #4169 lays out the pharmacodynamic (PD) assays that will likely be used in support of further optimization of this drug’s PK/PD profile. The assays include the familiar Btk autophosphorylation and PLC-g2 phosphorylation assays. Applied to the Phase 1 trial, the PK/PD analysis shows that BID dosing is preferable for CC-292, with 94% target coverage achieved at trough over 24 hours vs 83% target coverage (+/- 17%) at trough with qd dosing. This is important data that has already been applied to further clinical trials underway.

I’m hopeful that optimized dosing will allow CC-292 to achieve higher response rates. Looking beyond lymphomas, Celgene investigators will present preclinical data showing that CC-292 given in combination with a proteosome inhibitor carfilzomib had activity in Multiple Myeloma models (Abstract #682) suggesting other therapeutic areas for the development of Btk inhibitors.

Ono Pharmaceuticals will be presenting Phase 1 clinical data for ONO-4059, a covalent BTK inhibitor (Abstract #676). The trial enrolled 16 high risk rrCLL patients for a dose escalation study (20 – 320 mg). ONO-4059 is shown to have a half-life in circulation (T1/2) of 6 hours. Remarkably, PD analyses shows Btk target coverage of 100% at 24 hours at all doses tested. AEs were typical and not dose limiting. All patients initially responded. ORR is given as 70%, and 1 of 16 patients progressed. Notably, 15/16 patients are reportedly still on treatment. A second Phase 1 study (Abstract #4397), enrolled 14 patients (mantle cell lymphoma n=7, follicular lymphoma n=3, plasmablastic DLBCL n=1, ABC-DLBCL n=1, small lymphocytic lymphoma n=1 and Waldenstrom’s macroglobulinaemia n=1) using the same dose escalation design. This is a complex and difficult group of patients. ONO-4059 induced an initial response in all patients. The ORR (all patients) = 42% and for MCL patient ORR = 50%. AEs are similar to other Btk and P13K inhibitors.

The limited available data suggest that ONO-4059 is highly potent and will be an interesting drug candidate to watch. Preclinical data show synergistic efficacy with anti-CD20 antibody Obinutuzumab/GA-101 treatment, anticipating next steps (Abstract #3069).

Gilead is bringing forward a new Syk inhibitor, now in phase 2 clinical trials. Syk is the kinase just upstream of Btk and is required for Btk activation (see the model shown in Part 1). Early Syk inhibitors from Rigel and Portola were not selective and did poorly in the clinic, as discussed previously: Gilead’s new inhibitor GS-9973 (Abstract #1634) is presented as having 7.6 nM activity against Syk with no other kinase being inhibited below 100nM. The abstract presents early activity data, with most patients responding to therapy within 4 weeks. AEs are mild except for grade 3/4 liver transaminase elevations in a small number of patients. Gilead will give a fuller picture of this phase 2 trial at the meeting. Gilead is developing GS-9973 as a single agent and also in combination with Idelalisib – the latter trial is recruiting patients with diverse types of B cell lymphomas (NCT01796470). Here again we are seeing the development of a rational combination – targeting two key elements of the signaling cascades that support lymphoma proliferation and survival.

Certainly there appears to be room for the development of additional BTK inhibitors, as this space is hardly crowded, and it will be important for companies to control their own compounds, for use in combination studies.

New PI3K inhibitors will report data at ASH, with IPI-145 from Infinity Pharmaceuticals updating a Phase 1 trial in B cell lymphomas, including rrCLL. IPI-145 is a potent PI3Kgamma/delta inhibitor, and impacts signaling through both of these isoforms at a sub-nM KD. The Abstract #677 reveals a maximum tolerated dose of 75 mg bid and also suggests that 25 mg bid is sufficient for target coverage by PK/PD analyses. The PK/PD analysis is shown in abstract #1633. These are the data that support the dosing regimen used in the ongoing Phase 3 clinical trials. The preliminary ORR for the rrCLL patients in the Phase 1 trial (19 patients) = 53%, and it appears there were a high number of discontinuations. Importantly, AEs appear to be in line with other drugs in this class. At the meeting, Infinity will present updates data from treatment-naïve CLL patients who received IPI-145 at 25 mg bid and R/R CLL patients who received IPI-145 at 25 or 75 mg bid.

Amgen is developing AMG 319, a selective PI3Kdelta inhibitor. Results from the Phase 1 dose escalation trial are shown in Abstract #678. Doses were 25 – 400 mg qd. AEs were diverse and included colitis in some patients at the 400mg dose. Ex vivo analysis of the phosphorylation of AKT (downstream of PI3K) showed nearly 100% inhibition 24 hours after dosing at 400 mg. Clinical activity was seen in all patients at all doses, with dose dependent activity observed.

Gilead has a 2nd generation PI3Kd inhibitor in clinical development, GS-9820. In Abstract #2881 dose escalation results from the Phase 1b trial are shown for doses ranging from 50 – 400 mg bid. No MTD was observed, there was no liver toxicity and 9/12 patients showed some response to therapy.

Bayer has a very interesting presentation of phase 2 data with BAY 80-6946, a selective PI3Kalpha/delta inhibitor. This drug is given IV at 0.8 mg/kg. There are notable toxicities (neutropenia, hyperglycemia, hypertension) but the efficacy is impressive at least at this early stage of development. I calculated %ORR and %CR by B cell lymphoma type, as follows (note that the sample sizes are small):

The hypertension AE is being studied in a sub-study of the ongoing Phase 2 trial (NCT01660451).

TG Therapeutics will show early data for TGR-1202 a novel orally available PI3Kdelta inhibitor. Patients have been dosed from 50 – 400 mg qd. DLT was not observed and at the 200 mg dose about half the patients had stable disease and half had progressed. The company plans to present updated results at the meeting.

Sanofi will present phase 2 results of its pan-PI3K inhibitor SAR245409, using the MTD as defined in solid tumor studies. This drug also targets the downstream signaling proteins mTORC1 and mTORC2. Data are presented in Abstract #4170. Focusing just on the CLL patients (n=10) 5 patients have SD, PFS ~ 6 months and 5 patients have a PR, PFS ~ 16.5 months.  That’s not a bad result, except that AEs are notable – all patients have cytopenias, GI complications, and hypotension. An update will be presented at the meeting. Follicular lymphoma (FL) patient data from the same trial is shown in Abstract #86. rrFL patients were given SAR245409 at 50 mg bid until disease progression (PD) or withdrawal. 36% of patients were lost to PD and 7% to AEs. 24 patients were available for evaluation, as they had responses as follows: ORR = 50%, PR = 36%, CR = 7%. For those 28 patients PFS had not been reached at 8 months.

As we can see from this Sanofi drug, moving to a pan-inhibitor and also moving further down the signaling pathways (mTORC1/2) doesn’t necessarily translate to better mono-therapeutic efficacy.

A different approach is seen with the Merck drug MK2206, an allosteric AKT inhibitor. Abstract #2882 presents a very interesting Phase 1 study. There is a 1 week “run-in” with MK2206 alone, sufficient to demonstrate a PD effect. After the first week, MK2206 is given along with bendamustine (B) and Rituxan (R). The MTD is shown to be 90 mg/week. Early results show an ORR = 89% and CR = 22% in the small Phase 1 study (n=9). These results compare favorably to BR alone (9% CR and 59% ORR) in rrCLL patients.

Other PI3K, AKT, mTOR and related drugs are in the pipeline for hematologic malignancies, and this is an area that should evolve quickly.

Next we will look at few promising pathways and drugs, coming up in Part 4.