GlobeImmune, Inc.’s GBIM shares plummeted 51.3% following the company’s announcement that a randomized, open-label phase II study (0101) on investigational hepatitis B virus (HBV) candidate GS-4774 has failed to meet the primary endpoint.
The study compared three doses of GS-4774 (2YU, 10YU or 40YU) in combination with oral antiviral therapy (OAV) versus only antiviral treatment in chronic HBV patients, who were on long-term viral suppression and undergoing an OAV. Top-line results showed that patients treated with the highest dose of GS-4774 in combination with an ongoing OAV failed to achieve any reduction in hepatitis B surface antigen (HBsAg) after 24 weeks of treatment. Furthermore, the company revealed that there was no difference in HBsAg reduction between the two lower-dose treatment arms in comparison to the control arm at week 48.
We remind investors that GlobeImmune has a global agreement with Gilead Sciences, Inc. GILD for the development of therapies for chronic HBV infection based on GlobeImmune’s proprietary Tarmogen platform. Under this agreement, GS-4774 is exclusively licensed to Gilead Sciences.
Our Take
Phase II study data on GS-4774 is extremely disappointing since GS-4774 is the only mid-stage candidate in GlobeImmune’s pipeline. With its failure to meet the primary study endpoints, we have low visibility on the future development status of the candidate. We note that GS-4774 is being evaluated in another phase II study (1401) for the treatment of chronic HBV infection patients who are not receiving any other treatment. 48-week data from the study, which is enrolling patients, is expected to be available in mid-2016.
According to GlobeImmune, chronic HBV infection is the most common serious liver infection affecting nearly 400 million people across the world. Given that no therapy is yet approved for the vast majority of chronically-infected HBV patients, if developed successfully, GS-4774 could gain an opportunity to cater to a large market.
We expect investors to keep an eye on updates from the company on the 1401 study and further development plans for GS-4774.
Investors looking for well-ranked stocks in the health care sector may consider Actelion Ltd. ALIOF and Valeant Pharmaceuticals International, Inc. VRX. Both carry a Zacks Rank #1 (Strong Buy).
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