Gilead needs a big R&D hit. Here's why claims on NASH fall well short of that
For months now, the pressure has been building on Gilead to do something dramatic on the R&D side of the business, with analysts clamoring for the big biotech to buy something or build something big.
So when researchers claimed that they had hit pay dirt data in a mid-stage study of GS-4997 for a blockbuster indication like NASH, the company built it up as encouraging proof of efficacy and significant progress on an important front.
A big Phase III now comes next, says Gilead, adding another high-profile late-stage effort with potential blockbuster outcomes. It’s stock is up 1.4%.
But Gilead is experiencing a sharp backlash on this one.
“We believe this study answers nothing about the drug’s probability of having an effect as we believe NASH study design limitations make the efficacy results uninterpretable,” noted Baird’s Brian Skorney.
Let’s look at what Gilead put out today.
A total of 72 NASH patients with moderate to severe fibrosis were given either 18 mg or 6 mg of the oral drug per day, either alone or in combination with simtuzumab – another one of Gilead’s experimental drugs – with one arm reserved for simtuzumab alone. And the 67 evaluable patients performed well after 24 weeks. The high dose combination delivered a 43% rate for an improvement on fibrosis, the low dose 30% and the control arm hit 20%. The progression to cirrhosis was 3% in the high dose, 7% in the low dose and 20% in the simtuzumab-alone arm.
That’s a short period for these patients with the fatty liver disease. And it’s not many patients. So what’s the data worth?
Not a lot for some.
“If all you look at is the point estimate across the three arms, it looks like a home run,” says Skorney. “However, we believe the characteristics of the disease and trial design makes this an uninterpretable study, from an efficacy perspective. The error bars are huge and sizable placebo effects are well documented. Comparing today’s press release with the data in the AASLD late-breaking abstract (Figure 1), the addition of 20 patients markedly decreased separation between groups. In these 20 additional patients, the response went the opposite direction, with 50% of patients not getting GS-4997 showing a fibrotic improvement vs. 25% on the low dose and 20% on the high dose. We only highlight this to say, don’t read anything into the efficacy results of this study. The numbers are too small, the duration of treatment is too short and the data is complicated by the inclusion of another drug instead of placebo.”
Further dimming expectations are two failed mid-stage studies. Gilead says the same drug failed on pulmonary arterial hypertension (PAH) and diabetic kidney disease (DKD), so those programs are being scrapped.
Heading straight into Phase III with GS-4997, though, probably makes more sense than trying to execute a big Phase II to see if the data stand up, adds the analyst.
Gilead’s share price has been steadily dwindling for months as its torrent of hep C cash has slowed. Analysts want to see something that can fire up the revenue machine again, but as of today, they’re still not getting it.
Gilead CSO Norbert Bischofberger had this to say:
“We are encouraged by these data demonstrating the anti-fibrotic effect of GS-4997 in patients with NASH after only 24 weeks of treatment, and look forward to sharing the complete results with the hepatology community. Additionally, pending discussions with regulatory agencies, we plan to initiate a Phase 3 clinical trial program of GS-4997 in patients with NASH.”