Idenix shares drop after company ends development of experimental hepatitis C drug

Shares in Idenix Pharmaceuticals fell as much as 25 percent after the company announced that it would discontinue development of its experimental drug IDX320 for hepatitis C due to concerns over toxicity. Studies of IDX320, along with the company's hepatitis C agent IDX184, were placed on clinical hold by the FDA last year after liver function abnormalities were observed in three healthy volunteers participating in an early-stage trial investigating the drugs in combination.

The drugmaker indicated that investigations suggested the "observed toxicity was likely caused by IDX320," and it will stop development of the HCV protease inhibitor. Idenix said that after responding to the clinical hold on IDX184 last month, the FDA amended it to a partial hold. The company expects to begin a 12-week mid-stage trial of the agent in combination with pegylated interferon and ribavirin in the second half of the year.

Separately, Idenix noted that GlaxoSmithKline's ViiV Healthcare unit informed it of the FDA's decision to place a clinical hold on the experimental HIV/AIDS drug GSK2248761. Idenix noted that under a previous licensing agreement, ViiV has full responsibility for the development of the non-nucleoside reverse transcriptase inhibitor.

Wedbush Morgan Securities analyst Katherine Xu suggested the clinical hold on GSK2248761 may put at risk potential milestone payments of $390 million due to Idenix. "Overall, I think it’s more good news than bad but I don’t think the market will respond that way," Xu added.

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