ABBV HCV Regimen Approved; Further Upward Revisions to Consensus Likely

ABBV’s HCV regimen was approved Friday with a clean label reflecting the safety and efficacy characteristics that would be expected based on published clinical trials

List pricing of $83,319 is 12% below Harvoni; however we believe Harvoni sells at roughly 15% below list and that the ABBV regimen (‘Viekira Pak’) will have to sell at 15% below Harvoni, for a net price of roughly $68,276

Consensus gives ABBV 17% share of the 2015 market; we suspect this is less than ABBV will achieve. We see 20% as a worst-case, and believe significantly more (up to one-third) is feasible

We also believe 2015 consensus may be too low. In 2014 payors slow-walked HCV patients in hopes of treating them after premiums (or in the case of government payors, budgets) could be raised to reflect regimen costs, and after a second option was available that might offer lower net pricing. With these conditions met, payors are less able to delay treatment, thus our belief that 2015 estimates may be too low

We conclude that consensus for ABBV and ENTA is likely to rise further, and that both stocks are likely to see continued outperformance both in the absolute, and relative to GILD

For our full research notes, please visit our published research site