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3 Drug/Biotech Stocks in Focus on World AIDS Day

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Every year, World Aids Day is celebrated on Dec 1 to raise public awareness about Acquired Immuno Deficiency Syndrome, popularly known as AIDS. The day is observed to make people aware about proper cure and prevention of the disease. In this regard, this year, the theme for the day this year is "Right to Health." This day also commemorates those who have died from an AIDS-related illness.

World AIDS Day is one of the eight official global public health campaigns marked by the World Health Organization (WHO). According to WHO, globally, about 36.7 million people were suffering from HIV/AIDS at the end of 2016. Of the total, 2.1 million were children less than 15 years old.

AIDS is a pandemic disease caused due to the infection of Human Immunodeficiency Virus (HIV). The virus weakens the immune system by destroying cells that fight diseases and infections, eventually leading to AIDS. Medicines for the treatment of HIV are called antiretroviral therapy (ART) that slow or put a check on the progression of the virus.

Currently, companies are investigating new medicines to treat, prevent and ultimately cure HIV. Scientists also are exploring new treatment paradigms like two drug regimens, making therapies/drugs drugs with improved long-term safety profiles and new mechanisms of actions.

Despite improved medical understanding of HIV and significant efforts made by leading government and medical bodies to prevent and treat HIV/AIDS, this disease still has limited treatment options. In 2016, 1 million people died of AIDS-related illnesses, totaling to 35.0 million since the start of the epidemic.

Based on these statistics, it is not surprising that several healthcare companies are investing a significant amount of their R&D expenditures on developing treatments and devices for HIV and AIDS.

Stocks to Watch For

On World AIDS Day, here are some of the key pharma companies in the HIV market that investors can rely on.

GlaxoSmithKline (GSK - Free Report) has a long-standing commitment to HIV and AIDS. The company had developed the widely used antibiotic amoxycillin around 40 years ago, which was the first medicine approved to treat HIV. The sales of older HIV products — Epzicom and Selzentry — have been declining. However, the newer HIV drugs —Triumeq and Tivicay — are witnessing a consistent increase in sales and gaining market share.

Meanwhile, a significant portion of its R&D expenditures are being used toward developing HIV medicines to treat/prevent HIV.

Last week, Glaxo and partner Johnson & Johnson announced the FDA approval for Juluca — a combination of Glaxo’s Edurant/dolutegravir and J&J’s Tivicay/rilpivirine into a single tablet — for the treatment of HIV. Most medicines for HIV treatment are made up of three or more antiretroviral drugs. Juluca is the first two-drug regimen to be approved that reduces the number of medicines HIV patients take without compromising on the efficacy of a conventional three-drug regimen.

This week ViiV Healthcare, an HIV company majorly owned by Glaxo and Pfizer (PFE - Free Report) , announced the start of a large late-stage African study that will evaluate long-acting cabotegravirinjection for the prevention of HIV in sexually active women. If approved, cabotegravir injections will be administered every two months as opposed to presently available oral anti-retroviral medication, which needs to be taken every day.

Already, ViiV Healthcare has started conducting a HPTN 083 study on cabotegravirin HIV-uninfected men and transgender women who have sex with men, under co-funding with National Institute of Allergy and Infectious Diseases (NIAID). Meanwhile, cabotegraviris also being evaluated in three late stage studies as atwo drug regimen withEdurant, with the third study initiation announced earlier this week.

Furthermore, Glaxo is developing two drug regimen ofdolutegravir + lamivudine.

Gilead (GILD - Free Report) is a dominant player in the HIV market with an impressive portfolio. In fact, Gilead’s HIV franchise is a major contributor to sales with approved drugs like Genvoya, Truvada, Atripla, Stribild, Descovy, Odefsey and Complera.

The company was the first to introduce a single-tablet regimen (STR) for the treatment of HIV — Atripla. Gilead’s other STRs for HIV include Complera/Eviplera and Stribild. Its TAF-based product, Genvoya, happens to be a bestseller surpassing both Truvada and Atripla since fourth-quarter 2016.

Currently, Gilead’s bictegravir single table regimen (STR) for HIV treatment is under priority review in the United States. The FDA is expected to announce its decision in February 2018.

The STR is a fixed-dose combination of bictegravir, an INSTI, and emtricitabine/tenofovir alafenamide (FTC/TAF), a dual-NRTI backbone. This combination is also under review in the EU.

Another company working towards developing HIV drugs is Johnson and Johnson (JNJ - Free Report) . The company along with partner Glaxo recently received FDA approval for first two-drug regimen- Juluca, as discussed above. Further, the company along with The Bill & Melinda Gates Foundation and National Institutes of Health is conducting an efficacy study for an investigational mosaic HIV-1 preventive vaccine.

The study will evaluate whether the vaccine is safe and is able to reduce the incidence of HIV infection among women in sub-Saharan Africa.  HIV has a significant unmet need and women and girls account for about 60% of people living with HIV in eastern and southern Africa.

Others

Some other popular marketed HIV drugs are AbbVie’s (ABBV - Free Report) , Kaletra and Merck’s (MRK - Free Report) Isentress.

Mylan also recently received a tentative FDA approval for its combination tablet comprising efavirenz, lamivudine and tenofovir disoproxil fumarate.

Meanwhile, Merck is developing an investigational non-nucleoside reverse transcriptase inhibitor, doravirine both as a single-entity tablet and in combination (fixed dose tablet) with other antiretroviral agents — lamivudine and tenofovir disoproxil fumarate (TDF). The company plans to file regulatory applications for the same before the end of 2017.

Conclusion

AIDS/HIV is a life threatening disease which has limited medical cure. However, there are numerous companies that are developing drugs for the treatment and care for people suffering from HIV and for them who are at risk of becoming infected with HIV, thereby making the space competitive.

While Johnson & Johnson sports a Zacks Rank #1 (Strong Buy), both Glaxo and Gilead carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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