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Good news flowed in at Gilead Sciences, Inc (GILD - Free Report) from Europe when the European Commission approved its HIV drug Vitekta (elvitegravir) across two doses- 85 mg and 150 mg. The EC cleared the drug, an integrase inhibitor, for use as part of HIV therapy regimens inclusive of a protease inhibitor boosted by AbbVie Inc.’s (ABBV - Free Report) Norvir (ritonavir).

Gilead stated in its press release that Vitekta works by interfering with HIV replication. The inhibitor blocks the virus from integrating into the genetic material of human cells. Vitekta has proved to be effective in suppressing the disease in patients with drug-resistant HIV strains. The EC approved the drug on the basis of positive 96 week data from a phase III study (145). Data from the study reveled that Vitekta (once daily) was non-inferior to Merck & Co. Inc.’s (MRK - Free Report) HIV drug Isentress (raltegravir: twice daily) - another integrase inhibitor. Despite the positive news, Gilead’s stock price declined.

We note that the U.S. approval path for the drug has been far from smooth. In Apr 2013, Gilead received a complete response letter (CRL) on Vitekta from the U.S. Food and Drug Administration (FDA). The U.S. regulatory body declined to approve the drug as a monotherapy on the basis of the submitted data due to shortcomings observed in the documentation and validation of certain quality testing methods. Gilead is working towards resubmission of the new drug application (NDA).

Apart from the European approval for Vitekta, Gilead was in the news when it announced encouraging data from a phase III study (116) on its oncology candidate idelalisib in previously-treated CLL adults. Chemotherapy was not suitable for the patients. We remind investors that Gilead stopped the study earlier than scheduled on the basis of the recommendation of an independent Data Monitoring Committee (DMC) in Oct 2013. The DMC’s recommendation followed an interim analysis of the study where the candidate exhibited a positive risk-benefit profile.

Gilead is currently in discussion with the FDA regarding the submission of a NDA on idelalisib for treating CLL patients. We remind investors that in Sep 2013, Gilead filed a NDA with the FDA for idelalisib for treating patients suffering from indolent non-Hodgkin’s lymphoma. Gilead has also sought approval for idelalisib in Europe for the above indications.

Another promising candidate at Gilead is sofosbuvir (hepatitis C virus). The candidate is under review both in the U.S. (target date: Dec 8, 2013) and the EU. Gilead is highly optimistic about the potential of sofosbuvir. Apart from the late-stage pipeline, Gilead has multiple candidates in mid/early stages of development. The successful development of the pipeline candidates will help drive growth.

Gilead currently carries a Zacks Rank #2 (Buy). Actelion Ltd. (ALIOF - Free Report) appears to be more attractive with a Zacks Rank #1 (Strong Buy).


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