Yesterday, Anadys Pharmaceuticals Inc. (ANDS) started a 12-week phase II trial of its ANA598 for hepatitis C patients. ANA 598 will be evaluated in combination with interferon-alpha and ribavirin (current standard of care) in the mid-stage study. Data from the trial is expected to be released at the end of this year and in the first two quarters of 2010.

A total of 90 patients are planned to be enrolled in the study, with 30 patients receiving ANA598 and 15 receiving placebo at each dose level. The study would test 200 mg and 400 mg doses of the drug. In order to maximize early viral suppression, each patient would receive two 800 mg doses on the first day. The study would be conducted at various sites in the U.S.

Chronic hepatitis C virus (HCV) affects nearly 3.2 million people in the United States and about 170 million people globally. HCV causes inflammation of the liver, which can lead to fibrosis and cirrhosis. Lack of early diagnosis and treatment may lead to liver failure and/or liver cancer. HCV causes 8,000 to 10,000 deaths in the U.S. every year.

ANA598 had received Fast Track Status from the US Food and Drug Administration for the treatment of chronic hepatitis C. However, even if the drug can navigate clinical and regulatory hurdles smoothly, it will still face tough competition in the Hepatitis C market, which is dominated by Roche’s Pegasys/Copegus and Schering-Plough‘s (SGP) Peg-Intron / Rebetrol.

Vertex Pharmaceuticals (VRTX) and Valeant Pharmaceuticals (VRX) are also testing Hepatitis C drugs and are well ahead of ANA598 in terms of development. Hence, we believe competition will remain a challenge for Anadys in the years to come.

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