Sales of Johnson & Johnson's new hepatitis C drug soared
during its first full quarter on the market, in another sign of
strong demand--and high prices--for a new generation of treatments
for the liver-damaging illness.
The higher-than-expected $354 million in first-quarter sales for
J&J's Olysio follows evidence that another new hepatitis C
drug, Gilead Sciences Inc.'s Sovaldi, is having one of the
best-selling new drug launches in history. Gilead is schedule to
release results next week; some analysts think Sovaldi's
first-quarter sales could exceed $1 billion.
Both pills are expensive: Sovaldi costs about $84,000 and Olysio
$66,000 for standard 12-week regimens. A combination of the
two--which some doctors are prescribing as an off-label alternative
to the U.S. Food and Drug Administration's approved uses for the
drugs--costs $150,000.
Some health insurers and payers have complained about the high
prices, and, before authorizing coverage, have required doctors to
document that patients need the new drugs. The pharmaceutical
companies have said the prices reflect the value of the new drugs,
including their potential to prevent more costly health-care
services such as liver transplants if hepatitis C isn't cured.
Despite the costs, many doctors have embraced the new drugs
because they have shortened the duration of treatment to three
months from 12 months for certain patients, compared with older
medications, while improving chances of a cure and mitigating
certain side effects.
Both drugs are benefiting from pent-up demand; many patients had
deferred starting therapy in recent years so that they could take
these newer drugs. Hepatitis C, a slow-moving viral disease, is
estimated to infect about 3.2 million Americans. It is transmitted
through contact with infected blood, including sharing of
intravenous drug needles.
Olysio got a further boost in January when two medical societies
jointly issued new treatment guidelines, which included a
recommendation that certain hepatitis C patients who can't tolerate
an older injected drug, interferon, be given a combination of
Sovaldi and Olysio.
The FDA in November approved Olysio to be used in combination
with interferon and another older drug, ribavirin. In December, the
FDA separately approved Sovaldi to be used with interferon and
ribavirin for patients with the most common type of hepatitis C,
and with ribavirin alone for patients with less common types of the
virus.
The FDA didn't approve using a combination of Sovaldi and
Olysio. But many patients find it difficult to tolerate interferon
because of side effects such as flulike symptoms, and clinical
results have suggested that a combination of Sovaldi and Olysio
without interferon could be effective. The Sovaldi-Olysio
combination can be taken with or without ribavirin, according to
the new treatment guidelines.
More than 10% of physicians specializing in hepatitis C
treatment reported prescribing the Sovaldi-Olysio combination in a
recent survey conducted by Decision Resources Group, a health-care
research firm.
"We did see sales tick up right after those guidelines were
issued," J&J Chief Financial Officer Dominic Caruso said on a
conference call with analysts. "We do believe a large majority of
the sales are in combination with Sovaldi, apparently in an
interferon-free regimen."
J&J is conducting a late-stage clinical trial testing the
safety and efficacy of a combination of Sovaldi and Olysio, Mr.
Caruso said.
J&J also said Tuesday its first-quarter profit rose 35.2% to
$4.7 billion, or $1.64 a share, helped by tax-related gain, while
sales rose 3.5% to $18.1 billion. J&J shares traded recently at
$98.34, up $1.20, or 1.2%.
Write to Peter Loftus at peter.loftus@wsj.com
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