Idenix Pharmaceuticals, Inc. ( IDIX - Snapshot Report ) recently suffered a huge setback when it received a verbal notice from the US Food and Drug Administration (FDA) placing a partial clinical hold on its hepatitis C candidate, IDX184. IDX184, a nucleotide polymerase inhibitor, is being evaluated as a treatment for hepatitis C virus (HCV). Idenix shares were down significantly on the news.

The FDA has asked Idenix to conduct additional cardiac tests on patients in the ongoing phase IIb study of IDX184 in combination with pegylated-interferon and ribavirin for the treatment of HCV.

In June 2012, Idenix had reported positive interim data from the study. The data demonstrated that patients on IDX184 combination therapy achieved 100% and 80% sustained virologic response (SVR) with 100 mg and 50 mg dose, respectively.

In July 2012, the safety data of the trial was reviewed by an independent data safety monitoring board and found to be consistent with that of pegylated-interferon and ribavirin alone. Idenix planned the initiation of another study on IDX184 by the end of 2012, which might get delayed due to the FDA’s action.

The FDA placed a partial clinical hold on IDX184 to review its safety after serious cardiac-related adverse events were found to be associated with Bristol-Myers Squibb Company’s ( BMY - Analyst Report ) BMS-986094 (formerly known as INX-189). BMS-986094 is also a nucleotide polymerase inhibitor being developed for the treatment of HCV.

We remind investors that BMS-986094 was added to Bristol-Myers’ pipeline following its acquisition of Inhibitex Inc. earlier this year. On a conference call to address the issue, Idenix noted that the two drugs, IDX184 and BMS-986094, are significantly different.

Our Recommendation

We currently have a Neutral recommendation on Idenix. The stock carries a Zacks #3 Rank (Hold rating) in the short run.