Hep C Discussion Forum

Hi all,

Sovaldi seems like an old friend, yet Clinical Trials only started in 2010. It has an interesting history which may help explain it's high price.

The first molecular cloning of the HCV genome occurred in 1989. By 1999, full-length selectable replicons were available and researchers began the process of developing DAA's. As nucleoside analogues had been successful in treating HIV and Hepatitis B, this was an obvious place to start. The NS-5B viral protein seemed a promising site to block, preventing viral replication.

Enter Raymond Schinazi, a Jewish-Egyptian biochemist, educated in England. He was co-founder of Pharmasset (initially based in Barbados) in 1998. This company specialised in the development of nucleoside analogues, particularly for HIV. The company's base moved to Georgia, then Delaware and Schinazi employed several young biochemists to work on nucleoside analogues. One of these was Jeremy Clark, who spent 6 months researching a compound named PSI-6130. He noted the profound inhibition of the HCV NS-5B complex with virtually no side efects in rodents. Nucleoside analogues ('nukes') are difficult as they exist as a prodrug- that means they need a chemical reaction within the body before they become active. They also exist as isomers, so each compound may have several components. There is a whole family of closely related drugs- some are PSI-7128, PSI-7851 and our favorite, PSI-7977. When Clark went to patent his discovery in May 2003, he found Schinazi had beaten him to it.  PSI-6130 and PSI-7977 were attributed to Clark but owned by Pharmasset. Clark eventually left Pharmasset in 2005. Schinazi claims he offered Pharmasset to Gilead in 2004 for $300 million on the basis of the patents, but Gilead turned him down.

Schinazi had also co-founded Triangle Pharmaceuticals (HIV and HBV drugs), which was sold to Gilead for $464M in 2003. He's a brilliant biochemist, but even better businessman!

Pharmasset now had two 'nukes', PSI-6130 and PSI-7977. Another (PSI-938) was added and the rigorous preclinical testing started. Other companies such as Roche, Merck and Vertex also had their own 'nukes'. Pharmasset remained a small, cash-strapped company, but produced Racivir (for HIV) and listed on the Stock Exchange in 2007 (earning them $44M). They also received funding from the VA and Emory University. They had financial woes after their HBV drug, Clevudine, had to be withdrawn in 2009.   The Clinical Trials of it's 'nukes' started in 2010. Initially PSI-938 looked impressive until Trials were halted in 2011 due to liver toxicity. Other companies had problems. Balapiravir, Valopicitabine and INX-189 all had to be withdrawn. PSI-7977 was the standout. During late 2010 and 2011 the Phase 1,2, and early 3 Trials rolled in with impressive results.  SVR was becoming a reality with the success of Incivek and Victrelis, but the horrible side effects of Interferon intensified the search for interferon-free treatments.  In November 2011, at the AASLD, Dr Ed Gane released the final data from the Electron Trial of PSI-7977.

Gilead were in trouble. It had spent a small fortune on it's own 'nuke', GS-6620 with disappointing results. It had offered Pharmasset $100 a share but the CEO of Pharmasset, P.Schaefer Price, was also getting interest from Roche and Merck, and turned them down. Gilead went to $125 a share, to no avail. Eventually a deal was done for $137 a share, valuing Pharmasset at $11.2B.  Schinazi had long gone, but his 4% of stock netted him $440M and Price managed $255M. Gilead finally had it's 'nuke', now called GS-7977 and then Sofosbuvir.  Further Trials with Daclatasvir and Gilead's own drugs followed. Gilead probably spent up to $0.5B on the final Trials up to FDA approval in December 2013.

Putting a price of $1000 a pill has caused outrage. In reality, now that the dust has settled, most Dispensers and other countries (eg Germany and Portugal) and probably paying half that. The huge markets of the Indian sub-continent and China will have cheap generics. Remember that dreadful Incivek cost $49,200 for 12 weeks of treatment.

Gilead took an enormous risk. Developing antiproteases, non-nucleoside blockers and NS-5A blockers has been relatively easy. All the companies that tried for 'nukes' have been financially burnt, so we are unlikely to see a DAA that is as potent and safe as Sovaldi.

Finally, Jeremy Clark took Schinazi and Pharmasset to court in 2008, in relation to the patent of PSI-6130 and PSI-7977. I'm no legal expert, but it appears that the issue was the terms of Clark's employment contract. He was advised to seek Arbitration but for some reason didn't, so he took them to court again in 2010 and lost. He was on our Forum 2 years ago, bankrupted and unemployable. I see he was back in court in 2014, but again has lost his case. Sad.

So, as you take your Sovaldi, wonder at the history of a drug that only takes a few dollars to manufacture. Cheers.