Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN)’s Unspectacular Hepatitis C Campaign

Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) failed to achieve spectacular results in its hepatitis C treatment campaign with a compound known as ACH-3422. The development now raises questions about whether the company could be a great hepatitis C buyout as most investors had hoped.

Why is momentum shifting in ACHN?  Read this analyst breakdown.

Buyout concern

Although Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) was developing ACH-3422 for the treatment of hepatitis C, investors didn’t want the company to develop the drug itself to completion. Instead, investors had hoped that positive trial of ACH-3422 would increase the chances of Achillion as a buyout candidate, or even attract a premium buyout offer. A number of big pharmaceutical companies are vying for a position in the hepatitis C market and are looking out for promising drugs to buy.

Such potential hepatitis C buyers include AbbVie Inc (NYSE:ABBV) and Bristol-Myers Squibb Co (NYSE:BMY), which do not already have hepatitis C in their product pipeline.

All is not lost for Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) given that its compound, ACH-3422, showed some level of success. However, it is not likely that the company could attract a sweet premium in an acquisition deal.

Trial results

In the trial of ACH-3422 for a period of seven days, Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) achieved a level of success that was below the target. The company achieved 3.4-log reduction, yet the target was 4-log reduction. As such, Achillion extended the trial for an extra week that allowed it to achieve 4.8-log reduction with 700 mg dose of ACH-3422.

Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) is trying to compete with Gilead Sciences, Inc. (NASDAQ:GILD) and Merck & Co., Inc. (NYSE:MRK) in the hepatitis C space. Gilead Sciences is the only one with an approved hepatitis C drug, which is known as Sovaldi. Merck, on the other hand, acquired a hepatitis C compound, MK-3682, through its purchase of Idenix Pharmaceuticals.

Financial highlight

Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) revealed having $39.61 million in the treasury at the end of the most recent quarter. That was an improvement from $33.27 million in the previous quarter. The company had total assets worth $130.57 million and total liabilities of $10.97 million at the end of the latest quarter.

About the Author

Erica is a graduate of New York University's school of Journalism. She joined US Markets Daily as a general assignment reporter in January of 2008.

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