How FDA Warning Could Spell Disaster for AbbVie and Opportunity for Gilead

How FDA Warning Could Spell Disaster for AbbVie and Opportunity for Gilead

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Jefferies analyst Jeffrey Holford “strongly’ advises investors use yesterday’s selloff in shares of AbbVie as a buying opportunity, stating that the FDA warning letter applies to a very limited population within the hepatitis C market, which means it will have a limited impact on AbbVie’s HCV franchise”.

Pharmaceutical company AbbVie responded that while the drugs couldn’t be ruled out as a probable cause, no exact link has proven that they are the cause of the adverse effects experienced by the patients. Upon review, the agency was able to detect cases of liver failure and organ de-compensation among patients with existing liver cirrhosis, who were taking the drugs.

And in fact, the markets sliced more than 10% off of AbbVie’s share price by the market close, a reaction that Evercore ISI analyst Mark Schoenebaum said was hard to fathom, even in a market looking for reasons to sell. Purcell also said he views the selloff yesterday in shares of AbbVie as overdone, while raising his estimates for Gilead’s competing Hepatitis C drug Harvoni. Some of the cases occurred in patients for whom these medicines were contraindicated or not recommended.

The FDA warned that Viekira Pak and Technivie can cause “serious liver injury mostly in patients with underlying advanced liver disease”.

The FDA said it thinks use of the drugs might have caused liver injuries because of a temporal association after patients started using the drugs. For Viekira Pak, it also includes a recommendation that doctors assess evidence of “hepatic decompensation prior to treatment and during treatment in cirrhotic patients”.

GILEAD BENEFIT: After speaking with two hepatitis C virus specialists, Leerink analyst Seamus Fernandez believes the FDA warning of serious liver injury risk with Viekira Pak strengthens Gilead’s market position. Medical providers and the FDA are urging that patients not to stop these drugs without talking to their health providers for the fear of developing viral resistance. As a result, we are requiring the manufacturer to add new information about this safety risk to the drug labels.

Since the approvals of Viekira Pak in December 2014 and Technivie in July 2015, at least 26 worldwide cases submitted to FAERS were considered to be possibly or probably related to Viekira Pak or Technivie. In most situations, liver injury occurred within 1-4 weeks of beginning treatment. These drugs lower the amount of hepatitis C virus in the body by preventing it from multiplying and may slow down the disease, the FDA statement explained.

FDA is asking health care providers to be alert for signs and symptoms of worsening liver disease, including ascites, hepatic encephalopathy, variceal hemorrhage, and/or increases in direct bilirubin in the blood.


“The bottom line is that for the vast majority of patients who don’t have decompensated cirrhosis, these combinations perform excellently”, Chung said by phone, referring to people whose scarring has not hurt the liver’s ability to work.

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