Shareholders of Idenix Pharmaceuticals Inc. (NASDAQ: IDIX) have seen their share of peaks and valleys over the past few months but when news that the trial involving their hepatitis C drug, IDX184, had been placed on hold by the FDA due to concerns related to heart failure has taken those investors to lows they haven’t seen since late last year. After closing Wednesday’s trading session at 8.31 shares have plummeted, hitting a low of 5.40 and while they have since managed to climb back near the 6.00 level they remain well below the 50-day moving average of 9.58 and their 200-day moving average of 9.52.
This sudden dive in share price could prove to be a blessing to those investors who put faith in IDIX CEO Chief Executive Officer Ron Renaud who stated in a company conference call, “We believe this will be temporary, unfortunately we can’t give any concrete answer on our timeline.” If IDIX gets the green light from the FDA to continue their trial then those shares could quickly climb back to the level they held prior to the news.
That being said, IDIX could now face closer scrutiny from the FDA if they are allowed to move along the approval process and the agency could carry be even more critical of the drug if and when a decision is ever made on its commercialization.
Unfortunately for IDIX the FDA’s decision to give a verbal notice of a partial clinical hold had nothing to do with the results of the company’s current trial; rather, as the company noted, it was “a result of the recent occurrence of a serious cardiac-related adverse event encountered with a competitor’s nucleotide polymerase inhibitor for the treatment of HCV.” It was because of this event that the FDA opted to place the hold and further review the safety of IDX184.
IDIX’s IDX184 is a compound that comes from a class of medicines known as nucleotide polymerase inhibitors, the basis for similar hepatitis C treatments being developed by big names like Gilead Sciences Inc., Bristol- Myers Squibb Co. and Vertex Pharmaceuticals Inc. It was actually Bristol-Myers that announced on August 1, 2012 that they had halted their own study after a patient developed heart failure. While IDX184 is a different formula than the one created by Bristol-Myers, it is nucleotide-based.
Now IDIX is in the unfavorable position of trying to convince the FDA that IDX184 doesn’t carry the same risks. This is even more critical given the fact that IDX184 is the company’s main pipeline prospect and any negative blow to its advancement would be disastrous for Idenix.
IDIX has assured investors and shareholders that the company is confident that the matter will be settled and has said they plan to give the FDA data on their treatment. The company is actually trying to locate the 67 patients who have been administered the treatment in order to perform cardiac tests, all of whom have been off the medicine for at least a month.
As pointed out by IDIX in a press release distributed on Thursday, “In previous clinical trials as well as the ongoing phase IIb clinical trial of IDX184 in combination with pegylated interferon and ribavirin (PegIFN/RBV), there has been no evidence to date of cardiotoxicity in patients dosed with IDX184 with PegIFN/RBV beyond that seen with PegIFN/RBV alone. There are currently no patients receiving IDX184 worldwide.”
The question investors now have to answer is just how big of a risk is IDIX. It would stand to reason they would consider it a significant risk given the fact that there are a great number of companies developing hepatitis C treatments that aren’t falling under the same cloud of uncertainty. Any lingering doubt from the FDA could close the book on IDX184’s future and if that happens then it could be a long road to recovery for Idenix.