The Food and Drug Administration issued a warning that AbbVie’s Viekira Pak and Technivie drugs for hepatitis-C treatment can give patients serious liver injuries. Once this statement was released, AbbVie’s shares took a serious dip while Gilead Sciences’, their main competitor, soared.
AbbVie’s Shares Drop, it’s Competitors Gain
Gilead Sciences, on the other hand, has had its shares go up 6.4% to $108.10. One of AbbVie’s collaborators, Encata Pharmaceuticals, has taken a hit because of this statement and had its shares drop 32% to 27.12. Achillion Pharmaceuticals, known as ACHN, which is developing its own drug for hepatitis-C, has taken a 3.2% rise to $8.08.
Express Scripts was also affected by the FDA’s statement. The company, a pharmacy benefits manager, had made Viekira Pak and Technivie the treatment of choice for hepatitis-C patients in exchange for a discount from AbbVie. Their shares fell 6.1% initially, but they managed to regain some of the loss. In the latest update, its losses are reported at 3.7% to $83.
Comments on the Decline of AbbVie and Rise of Gilead Sciences
On the news, Mark Shoenenbaum expressed that there’s been this kind of impact only because this is the time when people are trying to scour reasons to sell or buy stocks. Reactions to news like this tend to be overreactions. Although ISI is sympathetic to the market environment, but in this particular instance, the impact is unfounded and difficult to understand.
With AbbVie’s shares having taken such a hit, it looks like Gilead’s main competitor for next year will be Merck, whose doublet regiment will have the The Prescription Drug User Fee Act law on its back in January 2016. Since the FDA made the announcement, its shares have gone up 3% to $52.13.
Word from AbbVie on the Aftermath of the Statement
AbbVie declared that in hindsight, their previous label had said that they were not recommended in Child-Pugh B, and that it contraindicated in Child-Pugh C. Now the company is contraindicated in both, but they sustain that this should not impact their current prescribing patterns, as they were not likely used in these patients under their old label.
It is yet to be seen if AbbVie will be able to recoup in good time.
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AbbVie"s Hep-C Drugs Cause Liver Damage
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