Some investors backed off BioChem Pharma Inc.'spromising hepatitis drug Monday after the release of datashowing relapse rates for hepatitis B patients whose virushad nearly cleared following six months of treatment withlamivudine.

Lamivudine, another form of the highly touted HIV drug,3TC, was tested in a 51-patient Phase II study thatinvolved six months of treatment and six months offollow-up for chronic hepatitis B infection. The drugsignificantly reduced hepatitis B virus (HBV) DNA, ALTlevels and hepatitis B e-antigen levels.

Of the 41 evaluable patients, 31 had undetectable HBVDNA after 24 weeks of treatment. Four seroconvertedduring the study, but the virus reappeared in the otherpatients.

BioChem Pharma's stock (NASDAQ:BCHXF) fell 6percent Monday, or $1.88, to close at $29.38 per share.The drop was slight, however, compared to the rise thestock has seen this year: It was trading between $8 and$11 at the end of 1994.

"It's not bad news," Tim Wilson, a senior biotechnologyanalyst with New York-based Hambrecht & Quist Inc.,said of the Phase II results. "People are looking for areason to sell because they've made a big profit in it. It's[now] a great buying opportunity."

Wilson said the message from the trial is that one year oftreatment is needed in many cases to totally clear thevirus.

The Laval, Quebec, company has Phase III trials oflamivudine ongoing in 22 countries. Most of thosestudies entail one-year treatment programs.

Gervais Dionne, BioChem Pharma's executive vicepresident, research and development, said the return ofthe virus in patients treated for six months is no cause foralarm.

"We don't see it as a big problem because this means sixmonths of treatment is not sufficient for most of thepatients," Dionne said. "What we can see is it's a verysafe drug, has potent antiviral activity . . . and we can seegood decreases in all the biological markers."

The company has tested the nucleoside analog in anumber of hepatitis B trials. For the most part, the drughas been effective at significantly reducing HBV DNAlevels during the treatment period. Certain patients haveseroconverted, or been cured, in trials that have beenshorter than six months.

The compound, like 3TC, is being developed incollaboration with London-based Glaxo Wellcome plc.Glaxo has filed for marketing approval of 3TC incombination with AZT. The Phase III trials of lamivudinefor hepatitis B were started in July 1994. Most of thestudies are using a once-a-day, 100 mg, oral-dosingregimen. More than 1,000 patients have been enrolled todate. n

-- Jim Shrine

(c) 1997 American Health Consultants. All rights reserved.