5 Biotech Stocks That Could Soar On New Hepatitis C Drugs

by: Investment Underground

By Erica Thinesen

When Vertex (NASDAQ:VRTX) released the latest results from its ongoing Phase II clinical trial of Incivek, an FDA approved Hepatitis C drug treatment, the stock price jumped. The data shows a 100% 'cure' rate for patients treated with the drug over a period of 12 weeks. This means the drug stopped the virus from spreading and from causing further damage to vital organs like the liver. Patients involved in the trial received Incivek along with pegylated-interferon and ribavirin.

The stock price jumped for a number of reasons. Not only is a 100% 'cure' rate impressive for any new drug treatment, the duration of use also prompted additional praise as most drug treatments require at least 24 weeks before patients show any signs of improvement. The company is also working on Phase II clinical trials to study the effects of a non-interferon drug treatment for Hepatitis C as well as Phase III clinical trials to study the effects of Incivek on those with both HIV and Hepatitis C.

In addition to Incivek, Vertex also developed and manufactures Kalydeco, a drug treatment used to help those with cystic fibrosis. The drug received FDA approval at the beginning of 2012 and has already helped many of those afflicted with the disease. Cystic fibrosis, a genetic disease, causes the formation of mucus that builds in the lungs and pancreas. Side effects of the disease include lung and infections and problems digesting food. For those who have the disease, the average life expectancy rate is 38 years.

Kalydeco helps patients by removing harmful proteins in the body to prevent mucus build-up. And while other treatments help patients live with the disease by treating some symptoms, Kalydeco is one of a few drugs that actually fights the disease head-on. For now, Kalydeco helps about 4% of those with cystic fibrosis, but with improvements, it may end up helping up to 16% or more over time.

Vertex is a sound investment for those who want to add a solid company with two FDA approved drugs in its pipeline to their investment portfolio. As Incivek and Kalydeco become more popular, investors can expect to see larger profits over time. With its attention to research and development along with promising results, Vertex is one company investors should continue to watch with increased enthusiasm and pride as these drug treatments really do make an impact in the lives of patients.

Other companies with similar approaches to research and development and a successful clinical trial results for Hepatitis C drug treatments include Abbott Laboratories (NYSE:ABT) which recently released data about its new oral Hepatitis C treatment, a combination of two of its drugs, ABT-072 and ABT-450. In clinical two clinical studies, patients showed a 95% 'cure' rate and a 93% 'cure' rate based on varying dosage levels and whether patients had previously taken other Hepatitis C treatments. This is a remarkable 'cure' rate for patients considering the treatment only lasted 12 weeks. Patients were given blood tests 24 weeks after discontinuing use of the treatment to see if the virus was still present.

Achillion (NASDAQ:ACHN) has several Hepatitis C drug treatments in its pipeline. The company is very close to finishing Phase II clinical trials for one of its Hepatitis C drug treatments, ACH-1625. Other drug treatments include ACH-2684, ACH-2928, and ACH-3102. Each of these treatments are undergoing various staging of clinical testing. With so many Hepatitis C drug treatments in development, the company must see profit potential in finding viable treatments for this disease - as it is estimated that over 3 million people in the United States alone have the disease.

Both Johnson & Johnson (NYSE:JNJ) and GlaxoSmithKline (NYSE:GSK) have Hepatitis C drug treatments in development as well. TMC435, Johnson and Johnson's drug treatment recently entered Phase III clinical trials. Phase II data revealed that 83% of those on the drug showed positive results after 24 weeks. This is very promising data which should carry over into Phase III trials. After these trials, the company can apply for FDA approval.

In 2011, GlaxoSmithKline reported that its FDA-approved drug Promacta, used in the treatment of certain blood disorders, helped 'cure' those with Hepatitis C. According to the company, 23% of patients showed no signs of the virus after taking the treatment. Whether the company will receive FDA approval to use the drug as a treatment for Hepatitis C remains to be seen, but since the drug is already on the market, so gaining approval for a secondary use will not be as difficult.

Investors looking for a profitable niche market in pharmaceuticals should carefully consider Hepatitis C drug treatments. This niche continues to grow as more and more companies develop treatments for the disease. With so many investment options, it is best to carefully review a company's full product portfolio as this can reveal how stable a company will remain if its Hepatitis C drug treatment fails to gain FDA approval or fails to impress the medical community and Hepatitis C patients.

Since most of these companies have other products in their pipeline, investors should also consider what lies ahead for these companies and these drug treatments. Reviewing clinical trial results gives investors a better idea of how well the FDA will receive these new treatments. It is important to consider the potential of rejection and then the subsequent resubmission of drug applications by companies for approval. This is a time consuming process that could take years to finish. Investors need to consider whether to invest in the long or short-term. Investing in companies like Vertex or Abbott Laboratories takes commitment and a firm belief that these drug treatments will receive FDA approval. Long-term investing is key here because if these treatments really can help 'cure' Hepatitis C, then investors will reap the benefits for a very long time.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.