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GSK seeks to spoil Gilead's party for Biktarvy in HIV

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By Marie Powers
News Editor

Within hours of the earlier-than-expected approval of Biktarvy (bictegravir 50 mg/emtricitabine 200 mg/tenofovir alafenamide 25 mg), Gilead Sciences Inc.'s once-daily single tablet regimen to treat HIV-1, Glaxosmithkline plc (GSK) and partners filed a patent infringement suit seeking to protect the interest of dolutegravir (Tivicay), the integrase inhibitor from Viiv Healthcare Ltd. Formed in 2009 as an HIV specialty company, Viiv is majority owned by London-based GSK, with Pfizer Inc. and Shionogi Ltd. as minority shareholders.

In a statement, Viiv and its owners said the suit involving U.S. Patent No. 8,129,385 was filed in the U.S. District Court for the District of Delaware, along with a case for a Canadian patent filed in the Canadian Federal Court in Toronto, both seeking financial redress for infringement. Viiv said it will seek to prove that Gilead's triple combination Biktarvy, which contains the HIV integrase inhibitor bictegravir, infringes Viiv's patent covering dolutegravir "and many other compounds that include dolutegravir's unique chemical scaffold."

Tivicay was approved by the FDA in 2013 to treat treatment-naïve and previously treated HIV-infected adults, including those treated with other integrase strand transfer inhibitors. The drug also was approved to treat individuals 12 and older weighing at least 40 kg (approximately 88 pounds) who are treatment-naïve or previously treated but without integrase strand transfer inhibitors. (See BioWorld Today, Aug. 14, 2013.)

At the time, analysts suggested Tivicay represented the first legitimate competitor to the formidable HIV franchise crafted by Gilead, including the four-drug, single-tablet Stribild, approved in 2012, which combines the ingredients of Truvada (emtricitabine/tenofovir disoproxil fumarate) plus elvitegravir and boosting agent cobicistat. On a head-to-head basis, Tivicay achieved that goal, recording 2017 sales of £1.404 billion (US$1.954 billion), GSK reported this week, compared to $1.053 billion in 2017 for Stribild. The consensus 2022 forecast for Tivicay is $3.358 billion in sales, according to Cortellis Competitive Intelligence, while the same-year sales forecast for Stribild is just $790.9 million.

A year later, the FDA approved Viiv's fixed-dose combination, Triumeq, which included Tivicay along with the nucleoside reverse transcriptase inhibitors abacavir (Ziagen) and lamivudine (Epivir), GSK legacy drugs. (See BioWorld Today, Aug. 26, 2014.)

Gilead has continued to add weapons to its HIV arsenal, as well, and Biktarvy's approval set off a new round of enthusiastic expectations. The drug's approval came Wednesday, a day after Gilead reported fourth-quarter 2017 product sales of $5.8 billion vs. $7.2 billion for the same period in 2016 and full-year sales of $25.7 billion vs. $30 billion in 2016. (See BioWorld, Feb. 8, 2018.)

Gilead spokesman Ryan McKeel confirmed the drug's U.S. wholesale acquisition cost (WAC) for a 30-tablet bottle at $2,945.65, or $35,839 for 12 months of therapy, at parity with the current price of the company's Genvoya, which was the first FDA-approved tenofovir alafenamide (TAF)-based regimen, combining elvitegravir 150 mg, cobicistat 150 mg, emtricitabine 200 mg and TAF 10 mg. (See BioWorld Today, Nov. 6, 2015.)

Gilead, of Foster City, Calif., plans to begin shipping the product to wholesalers this week.

"Viiv's patent challenge does not impact our ability to make Biktarvy available to patients in the U.S., and we remain steadfast in our opinion that Biktarvy does not infringe Viiv's U.S. patent," McKeel told BioWorld.

'A gold standard HIV regimen'

In a quick take, Cowen and Co.'s Phil Nadeau laid bare the foundation of GSK's concern. Biktarvy priced at only a modest premium to Triumeq, which has a WAC of $2,805.20 for 30 days, he pointed out. Although a black box warning was included on Biktarvy's label for acute exacerbations of hepatitis B, the same is true for Genvoya, Triumeq and other HIV single-tablet regimens.

But, unlike Gilead's boosted integrase inhibitor elvitegravir (part of Genvoya and Stribild), "dolutegravir is a true once-per-day molecule," Nadeau pointed out. Until now, prescribers have been forced to choose between a single-tablet regimen that lacked a best-in-class agent (dolutegravir or TAF) or a combination therapy that included Descovy (F/TAF) with Tivicay, he maintained.

"Our consultants have been clear that if bictegravir is merely 'just as good' as dolutegravir in terms of both efficacy and safety, then Biktarvy will become their clear first choice regimen," Nadeau wrote. "In fact, under this scenario our consultants report they will have 'no need' for Tivicay or Triumeq and would rapidly shift prescribing toward B/F/TAF."

With phase III data suggesting that Biktarvy's efficacy, safety and tolerability achieved those thresholds, "we think that Gilead is poised to recapture share in the HIV market now that Biktarvy is approved," he added. "As Tivicay and Triumeq are currently at an approximate $4 [billion] annual revenue run rate, should Gilead capture even 25 percent of their patient share it would drive meaningful incremental revenue for GILD's HIV franchise, which we project will have $14.8 [billion] in revenue in 2018."

Biktarvy "should help set the stage for long-term growth and sustainability of GILD's core HIV franchise," RBC Capital Markets analyst Brian Abrahams agreed following the drug's approval Wednesday. Sales of the once-daily medicine arrived with a clean label, he said, estimating peak sales of $4.8 billion in 2025.

"We expect a solid initial launch," Abrahams wrote, "though perhaps not quite as rapid as TAF-based regimens, which had safety impetus to switch." Overall, the drug's "multiple best-in-class attributes" could make Biktarvy "a gold standard HIV regimen" for treatment-naïve patients.

Abrahams saw little reason to change his outlook after the patent lawsuit was filed, an event he predicted prior to Biktarvy's approval.

"Over the past several months, we have discussed extensively the possibility of GSK/Viiv initiating a lawsuit against GILD for potential bictegravir patent infringement of broad dolutegravir [intellectual property]," he wrote Thursday in a first glance. "Overall, we see low stock impact to GILD, as this issue had been identified previously and was coming onto investors' radars."

He called a preliminary injunction blocking Biktarvy's launch "extremely unlikely" and predicted that Gilead "has a good likelihood of ultimately prevailing," should the issue go to trial. A worst-case scenario, Abrahams said, "would likely be a single-digit royalty to GSK/Viiv until 2026+."

Although GSK alleges that Gilead observed dolutegravir chemical structure during the 2010 Conference on Retroviruses and Opportunistic Infections and copied the drug, "the fact that GILD did not file its own patent application until nearly three years later, along with the key structural dissimilarities, leads us to believe that GILD invested a substantial amount of time inventing a novel, patentably distinct and non-infringing compound," he added.

Abrahams ticked off key differences between the undeniably similar chemical structures of bictegravir and dolutegravir, which he said included Di- vs. tri-fluorination, R- vs. S-chirality and substituted-ring features. He added that "one important feature of [bictegravir], the carbocycle on the substituted ring, may not be covered by GSK's '385 patent – providing GILD an opportunity to argue non-infringement."

Resolution of the case could take two to four years, he suggested.

In an email, Evercore ISI analyst Umer Raffat also dug into the legal weeds, writing that, "At the most basic level, as much as there is remarkable structural similarity between GILD's bictegravir vs. GSK's dolutegravir, GILD's chemical structure does NOT include a bridged ring – and that's the crux of this case."

GSK's U.S. Patent No. 8,129,385 is fairly broad, "with Markush-type claims which theoretically cover hundreds of structures," Raffat pointed out. But despite GSK's legal protest, the bridged ring in Gilead's structure is not captured among the possible combinations of substituents specified in GSK's patent, he said. Even if the trifluoroaryl in bictegravir's structure was captured by the Markush claims in GSK's '385 patent – a prospect Raffat deemed likely – the bridge aspect would take precedent, making infringement moot.

Other analysts generally reached the same conclusions on the legal wrangling. Jefferies Group LLC analyst Michael Yee maintained that the lawsuit did not change the thesis for Gilead "and should not impact any of the bull case." Although a modest royalty "could be possible far down the road," Yee noted that such arrangements typically end in settlements or single-digit royalties. An injunction, he added, "would be a very high hurdle to overcome," suggesting "the financial implications, in our opinion, are minor."

Biktarvy is also under review by the EMA, which validated the application in the EU in July 2017.

On Thursday, Gilead's shares (NASDAQ:GILD) lost $4.54 to close at $78.22.

Viiv also disclosed Thursday that it launched the eighth phase III study in the two-drug regimen investigating Tivicay and Epivir in individuals with HIV who achieved viral suppression on a tenofovir alafenamide fumarate (TAF)-based regimen of at least three drugs. The TANGO study is expected to enroll approximately 550 adults with HIV-1 at sites in North America, Europe, Australia and Japan to assess noninferior antiviral activity of switching to Tivicay/Epivir compared to a TAF-based regimen over 48 weeks. TANGO will characterize patient satisfaction as well as long-term antiviral activity, tolerability and safety to 96 weeks. Top-line data are expected next year.

TANGO follows Viiv's ongoing phase III GEMINI studies investigating the Tivicay/Epivir combo in treatment-naïve patients with HIV-1. Results from those trials are expected this year.

GSK's shares (NYSE:GSK) gained 14 cents Thursday to close at $36.17.