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Achillion Pharmaceuticals, Inc.’s (ACHN - Snapshot Report) shares are up more than 170% in just two days.

In the last trading session, the share price soared 83.29% after the company announced that the FDA has removed the clinical hold on its hepatitis C virus (HCV) candidate, sovaprevir, which is an NS3/4A protease inhibitor.

We remind investors that the regulatory body had placed a clinical hold on sovaprevir in June last year after observing elevations in liver enzymes in a phase I study. The FDA has now allowed Achillion to conduct studies with once daily sovaprevir (a maximum of 200 mg) in patients suffering from HCV and in single dose trials on healthy volunteers. However, the FDA maintained a partial clinical hold and stated that prior review and approval of the protocol will be required if the company needs to conduct multiple dose studies in healthy volunteers.

Apart from sovaprevir, another HCV candidate, ACH-3422, is also in focus at Achillion. The company has started dosing patients in its phase I study with proof-of-concept results expected this fall. Moreover, the company plans to initiate all oral combination studies with ACH-3422 later this year.

We are pleased to see Achillion progressing with its HCV pipeline. The HCV market is currently led by Gilead Sciences (GILD - Analyst Report). Gilead’s HCV treatment Sovaldi (launched in Dec 2013) generated revenues of $2.27 billion in the first quarter of 2014. Moreover, the company is looking to get a combination therapy of ledipasvir and Sovaldi approved in the U.S. and EU. Several big pharma/biotech are developing therapies targeting the lucrative HCV market.

Achillion had gained 47.6% on Monday’s trading session on the announcement that Merck & Co. Inc. (MRK - Analyst Report) would be acquiring Idenix Pharmaceuticals, Inc. for $3.85 billion. The deal represents a premium of approximately 238.9% on Idenix’s price before the offer was announced. For more details, check out our article on the topic “Idenix Skyrockets on Merck Acquisition Deal”.

Achillion, with its HCV pipeline, is being viewed as a potential takeover target.

Achillion carries a Zacks Rank #4 (Sell). Gilead is a better-ranked stock with a Zacks Rank #1 (Strong Buy).

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