Reports of elevated liver enzymes in patients treated with ViroPharma Inc.'s hepatitis C drug, HCV-796 in combination with standard therapy prompted the Exton, Pa.-based company, along with partner Wyeth Pharmaceuticals, to suspend dosing in a Phase II trial.

Particularly disappointing in the wake of some impressive efficacy data demonstrating HCV-796's antiviral effect when administered in combination with pegylated interferon and ribavirin, the news sent shares of ViroPharma (NASDAQ:VPHM) tumbling 15 percent, or $1.52, Friday to close at $8.70, and added another thump to Madison, N.J.-based Wyeth (NYSE:WYE), which, the same day, failed to get FDA approval for bifeprunox, a schizophrenia drug partnered with Solvay Pharmaceuticals Inc. Wyeth's stock dropped $2.99 Friday to close at $46.59.

The companies' decision to discontinue dosing of HCV-796, an orally dosed non-nucleoside polymerase inhibitor, followed a review of safety data accumulated to date from the Phase II study, in which the joint safety board "identified a potential association between HCV-796 and an elevation of the levels of serum transaminases," which can lead to liver damage, ViroPharma's Chief Scientific Officer Colin Broom said in a conference call.

Eight percent (13 patients) of those treated in the HCV-796-treated group had serum alanine transaminase (ALT) values at greater than or equal to three times the upper limit of the normal range, Broom said, and that group included two patients who withdrew from the study a few weeks ago after their ALT values reached 10 times the upper limit. In about half the affected patients, the increases in liver enzyme levels appeared transient.

In the patients treated with standard therapy without HCV-796, only 1 percent experienced elevated liver enzymes.

"This was certainly not the data we expected to share with you this quarter," Broom told investors, though the company maintained that there still could be a development pathway for HCV-796. For one thing, Broom said, "we only observed [the elevated liver enzymes] after eight weeks or more of treatment," and there's "no evidence of such an elevation in our previous Phase Ib trial or at the four-week mark" in the Phase II study.

Preliminary data, however, have yielded some promising signs of efficacy. In treatment-naïve patients receiving HCV-796 as part of the triple-drug therapy, 45 percent (34 of 75) had undetectable HCV levels at four weeks vs. 7 percent (five of 75) in the interferon- and ribavirin-only arm, and 93 percent of patients given HCV-796 showed greater than or equal to a 2 log10 reduction in HCV RNA compared to 47 percent in the standard treatment group. With only a portion of the data available at 12 weeks, Broom said, results showed that 73 percent (27 of 37) of patients on triple-drug therapy had undetectable HCV levels vs. 39 percent (15 of 38) on standard therapy.

ViroPharma and Wyeth intend to continue the Phase II study through the end of the planned 48-week mark, with all patients receiving only interferon and ribavirin, to determine whether a short-term treatment with HCV-796 has a long-term effect on viral load reduction. In the meantime, the companies will continue to evaluate the safety data to determine a precise cause of the apparent liver toxicity.

"It represents a setback, I hope, only a delay," Michel de Rosen, ViroPharma's president and CEO said, assuring investors that the two companies would "work diligently to advance" the product forward.

Overall, it's been a frustrating summer for some companies in the competitive HCV space. Last month, the FDA put Cambridge, Mass.-based Idenix Pharmaceuticals Inc.'s nucleoside inhibitor valopicitabine on clinical hold after safety data indicated increased gastrointestinal side effects. Like ViroPharma's drug, valopicitabine also had previously shown encouraging efficacy in Phase II. Valopicitabine is partnered with Basel, Switzerland-based Novartis AG. And, in June, XTL Biopharmaceuticals Ltd., of Valley Cottage, N.Y., opted to suspend further development of its non-nucleoside polymerase inhibitor, XTL-2125, after results from a 56-patient Phase I trial showed no significant difference in HCV RNA viral load reductions between the treatment and placebo groups. (See BioWorld Today, July 16, 2007.)

Other companies forging ahead in HCV include Cambridge-based Vertex Pharmaceuticals Inc. and Kenilworth, N.J.-based Schering-Plough Corp, which are in Phase II trials with their respective protease inhibitors, telaprevir and SCH 503034. Vertex anticipates moving into Phase III studies by the end of this year. Earlier in development is R7128, a nucleoside polymerase inhibitor from Princeton, N.J.-based Pharmasset Inc., which recently completed patient enrollment in a multiple ascending-dose study in HCV patients.

ViroPharma and Wyeth first began working together in HCV in late 1999, and are co-developing the drug, splitting costs evenly between the firms.

ViroPharma, which reported a net income of $31.6 million, or 45 cents per share for the second quarter - the company's revenue comes from sales of its marketed antibiotic, Vancocin, which totaled $56.1 million for the quarter - had about $516.8 million in cash as of June 30. In addition to its share of HCV-796 development, the company is funding other pipeline products, including cytomegalovirus drug Camvia (maribavir), which recently began its second pivotal study in liver transplant patients.