3:50 PM EDT, September 6, 2011
(Reuters) - Pharmasset Inc said its hepatitis C shot showed positive results in a trial involving patients who have not been previously treated for the infection, sending its shares to a life-high on Tuesday morning.
In a mid-stage trial named PROTON, 98 percent of patients achieved sustained virologic response (SVR), or no detectable virus levels in their blood, 12 weeks after the treatment was completed.
Patients were given either 400 mg or 200 mg doses of the drug, PSI-7977, once daily for 12 weeks in combination with the current standard-of-care for hepatitis C -- peginterferon alfa 2a and ribavirin.
"We continue to like Pharmasset's prospect as the nucleotide leader in hepatitis C virus," William Blair & Co analyst Katherine Xu said and raised her price target on the drugmaker's stock to $73 from $71.
In March, Pharmasset's mericitabine showed a 24 percent relapse rate at the European Association for the Study of the Liver Conference, sparking concerns about the potency of drugs such as PSI-7977 that belong to the nucleotide class.
However, the zero potency shown by PSI-7977 "clears the cloud above nucleotides," she added.
Hepatitis C affects about 300 million people worldwide, causing 8,000-10,000 deaths each year due to chronic liver disease caused by the virus.
Citigroup's Yaron Werber said the company was his "top pick" and maintained a price target of $100 on the stock.
Pharmasset, which competes with Merck & Co and Vertex Pharmaceuticals Inc in the multibillion-dollar hepatitis C market, said patients will now be monitored for virus levels 24 weeks after treatment completion, which is the main goal of the study.
Vertex's Incivek won U.S. approval in May, and by July was reported to have garnered blockbuster sales. Merck's Victrelis, which was given the nod in May to be marketed in Europe and the United States, is expected to touch sales of $1 billion.
Shares of the company, which rose 9 percent to a life-high of $69.90 on Tuesday morning, pared some of their gains to trade up 6 percent at $68.23 on Nasdaq.
(Reporting by Zeba Siddiqui in Bangalore; Editing by Roshni Menon)
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