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Earlier this week, the company was basking in the glow of encouraging tests results for its new treatment for the liver disease hepatitis C. Abbott (NYSE:ABT) said Monday that its drug regimen cured 99 percent of patients in a midstage study with the most common and hardest-to-treat type of the disease.

Abbott's hepatitis C trial announcement evidently sent shivers down the spines of Gilead Science (NASDAQ: GILD) shareholders. Traders must have feared that Gilead ran the risk of being overtaken in the race for supremacy in the worldwide market for new hepatitis C treatments. After all, the stakes are high, with the market expected to reach $20 billion by 2020, according to Bloomberg.

Order seems to have been restored, though. Gilead appears to be back in favor. Evidently investors are confident that Gilead's two-drug regimen is going to prove superior to Abbott's and other competitors when all is said and done. One big drawback of the Abbott regimen is that it contains the drug ritonavir, which physicians don't want to use.

That's far from saying Gilead will have the market all to itself. According to an article in Bloomberg, Catherine Arnold, an analyst with Credit Suisse Group AG in New York, said she sent a note to clients projecting that Gilead would have $3.8 billion in hepatitis C sales in 2020, and Abbott would follow with $2.5 billion.

Another major player is expected to be Bristol-Myers Squibb (NYSE: BMY), with $1.3 billion. The company reported this week that one of its drug combinations helped patients who hadn't previously been treated for the viral infection.

Given that the hepatitis C treatment market is so lucrative, it's attracted others than the Big Three already mentioned. Companies testing therapies, either alone or together, include Achillion Pharmaceuticals Inc. (NASDAQ: ACHN), Idenix Pharmaceuticals Inc. (NASDAQ: IDIX), Merck (NYSE: MRK) and Vertex Pharmaceuticals Inc. (NASDAQ:VRTX).

For now, Gilead is still King of the Hill. The company has an 800-patient trial underway, and it's possible results of that study could be reported at the American Association for the Study of Liver Diseases' annual meeting next month in Boston. If that happens, we might see Gilead apply for FDA approval as soon as the middle of 2014.

Given the uncertainties in the Hep-C Market Stock Traders Daily has produced detailed trading reports for the Stocks Mentioned in this article.

Riding high after hitting a 52-week high on Monday, Abbott Laboratories (NYSE: ABT) has taken a punch to the gut as investors haven't liked what they've heard about taxes. Specifically, the tax rate that's going to be paid by the two companies Abbott will split into later this year. The new rate is expected to be about 10% higher than the company's been paying, and that boost is expected to dampen earnings at both firms.

Source: Players In Hepatitis C Treatment Market Officially In Play