Achillion raising $56.6 million to advance hepatitis C candidates
This article was originally published in Scrip
Achillion Pharmaceuticals on 22 June priced a public offering of 9.6 million shares of its common stock at $5.90 per share, a modest discount to the closing price of $6.01 on 21 June, raising $56.6 million. The firm expects net proceeds of about $52.9 million.
The firm also granted an overallotment option for up to an additional 1.4 million shares to the joint bookrunners BofA Merrill Lynch and Leerink Swann. Achillion shares closed 22 June at $7.26, a gain of $1.25, or 21%.
The new funds will help give momentum to an antiviral pipeline for hepatitis C, and extend the company's cash position out to 2012, as it recently said in its quarterly results that it had $46 million in cash and equivalents as of 31 March.
The company’s most advanced candidate is the protease inhibitor ACH-1625, which is in Phase IIa testing in both the US and Europe to treat chronic HCV infection. While the compound, a reversible inhibitor of NS3 protease, has shown promising early results, it is behind both two other protease inhibitors in what is becoming a crowded HCV arena: Vertex's Incivek (telaprevir) and Merck & Co's Victrelis (boceprevir) (scripintelligence.com, 23 May 2011).
Achillion has told investors that it believes ACH-1625, while still in early testing, has demonstrated best-in-class features, including once-daily dosing, robust antiviral activity, coupled with a clean safety and tolerability profile for patients. After recent results from the ongoing Phase IIa trial were reported, Achillion CEO Michael Kishbauch stated that the attributes of the investigational compound "suggest it could offer improvements over next-generation protease inhibitors that will reach the market mid-decade".
Results from the first 28-day dose-ranging segment of the Phase IIa trial demonstrated that HCV-infected patients receiving doses of 200mg, 400mg, or 800mg once daily of ACH-1625 in combination with standard of care, pegylated interferon alfa-2a and ribavirin, achieved a rapid viral response (RVR) of 75-81% compared to an RVR of 20% for patients receiving standard of care only. Viral load was reduced in HCV patients by up to 100,000 fold at the dose range. The company has just initiated patient dosing in segment two of the trial, where 60 HCV-infected patients will be randomised to receive once daily doses of 200mg, 400mg and 800mg of ACH-1625 in combination with standard of care for 12 weeks of dosing. The 12-week complete early virologic response (cEVR) trial results are anticipated in the fourth quarter. The trial is taking place in genotype 1 treatment-naïve HCV-infected patients.
A second protease inhibitor, ACH-2684, described as a novel pan-genotypic protease inhibitor, has recently begun Phase I testing for the treatment of chronic HCV infection in both healthy subjects and genotype 1 or 3 subjects. In its prospectus, Achillion stated that the investigational agent has demonstrated that it effectively suppresses a broad range of natural variants of HCV, and may be effective in the prevention and treatment of emerging resistant variants.
The NS5A inhibitor, ACH-2928, is also set to initiate Phase I testing in 2011. Achillion claims it is the lead candidate of its portfolio of NS5A inhibitors. The compounds are highly active and potent against HCV genotypes 1a and 1b, as well as across other genotypes, the prospectus notes. Importantly, NS5A inhibitors are synergistic in combination with NS3 protease inhibitors, NS5B polymerase inhibitors, interferon and ribavirin. (The synergistic activity seen with ACH-2928 and ACH-1625 is particularly important as the treatment paradigm for HCV is moving toward combination therapies.)
Achillion noted in the prospectus that it is seeking a collaborative partner for ACH-1095, another protease inhibitor, which is in Phase I. It was originally developed in collaboration with Gilead, but its rights have since been handed back to the company, although Gilead still retains certain future development rights.
The company is also seeking collaborative partners for these product candidates, for which it is not devoting significant resources at this time: ACH-702 and ACH-2881 for drug-resistant bacterial infections, and an HIV candidate, elvucitabine.