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Pharmasset Climbs After Study Result Released

From Associated Press (September 6, 2011)

Drug developer Pharmasset Inc. hit a "home run" with results from a mid-stage study of a potential hepatitis C virus treatment, according to a Citi analyst.

THE SPARK: Pharmasset, based in Princeton, N.J., said Tuesday results from a study of the drug candidate labeled PSI-7977 showed that 91 percent of the subjects enrolled, or 43 out of 47 patients, had undetectable levels of the virus 12 weeks after their treatment stopped. The company is studying a 400-milligram dose of PSI-7977 used in combination with two other treatments in patients with a form of the hepatitis C virus who had not been treated previously.

Pharmasset will monitor the patients for a total of 24 weeks, or six months, after treatment stops. Results from the study will be presented in November at a meeting of the American Association for the Study of Liver Diseases.

THE BIG PICTURE: Pharmasset has no products on the market. The company said in July its fiscal third-quarter loss widened to $22.6 million, or 60 cents per share, due to continued development of the drug. It reported $246,000 in revenue, which comes from partnership payments from Swiss drugmaker Roche Holding AG.

THE ANALYSIS: Analyst Dr. Yaron Werber said in a Tuesday morning research note the study's cure rate was the highest ever seen, and it surpassed his expectation of between 85 percent and more than 90 percent.

"This should cement confidence in the long-term outlook, in our view," Werber wrote.

In August, Werber said PSI-7977 will become part of the backbone for hepatitis treatments, due in part to its high potency.

SHARE ACTION: Up 3.9 percent, or $2.51, to $66.71 in morning trading, while broader trading indexes fell more than 2 percent.

Posted: September 2011