ABOUT DATAMONITOR HEALTHCARE 2
About the Infectious Diseases and Respiratory pharmaceutical analysis team 2

CHAPTER 1 EXECUTIVE SUMMARY 3
Datamonitor insight into the hepatitis C market 3
Key metrics 6
Datamonitor Pipeline Assessment Summary 8
Contributing experts 9
Related reports 9

CHAPTER 2 PIPELINE OVERVIEW AND DYNAMICS 11
Current market overview 11
Pegylated interferon alpha in combination with ribavirin is current standard of care 12
The history of hepatitis C virus therapy from interferon monotherapy to pegylated interferon plus ribavirin combination therapy 13
Standard interferon monotherapy was initially used to treat hepatitis C virus 13
Ribavirin enhances the effects of interferons but is associated with anemia 15
Pegylation of standard interferon reduced the dosing frequency 16
The hepatitis C pipeline is highly active 17
The hepatitis C virus pipeline consists of compounds with different mechanisms of action 19
Datamonitor expects the hepatitis C virus market to increase to $4.5 billion by 2017 23
Key companies involved in the hepatitis C virus pipeline 25
Roche 26
Schering Plough 28
Vertex 29

CHAPTER 3 DISEASE OVERVIEW - PATIENT POTENTIAL 31
Definition of hepatitis C virus 31
Hepatitis C virus escapes immune surveillance by the host, causing chronic infection 31
Chronic hepatitis C virus infection silently progresses to liver cirrhosis and cancer over prolonged periods of time 32
Significantly higher hepatitis C virus prevalence is found in intravenous drug users and patients who received blood transfusions before the 1990s 34
Immigration from areas of high prevalence is having a growing impact 35
The number of patients developing chronic hepatitis C will increase over the coming years 36
Management of hepatitis C virus 36
Segmentation of hepatitis C virus 37
Patients can be stratified according to hepatitis C virus genotype 37
The distribution of hepatitis C virus genotypes varies by geography and route of transmission 38
Genotype 1 is the most difficult to treat 40
There are different types of response to therapy 40
Epidemiology of hepatitis C virus 41
Estimating prevalence 42
US 42
Japan 43
Europe 44
France 45
Germany 45
Italy 45
Spain 46
UK 46
The HCV market has significant unmet needs 46
High efficacy in genotype 1 patients and non-responders remains the greatest unmet need 47
Improvements in tolerability and dosing may lead to better treatment outcomes 48
Shortened duration of treatment 49
Drugs efficacious in patients who do not respond or show intolerance to interferon 50
Effective therapies for hepatitis C patients of non-Caucasian ethnicity (African-American, Asian) 51
Drugs efficacious in HCV/HIV co-infection 51

CHAPTER 4 R&D APPROACH 53
Classification of pipeline products 53
Interferons 53
Small molecule antivirals 54
Immunomodulators 54
Therapeutic vaccines 54
Clinical trial design in hepatitis C virus 55
Future hepatitis C virus therapy falls into three distinct categories 55
Add on therapy currently appears to be the most promising strategy 55
Interferon and ribavirin replacement is unlikely 55
Sustained virological response is the most frequently used endpoint 57
Early virological response and rapid virological response are strong predictors of sustained virological response and are increasingly being used 58
Patients are stratified according to genotype and response to therapy 59
Clinical trials for novel agents are focusing on genotype 1 patients 59
The non-responder population is also attractive given the high unmet need 60
Late-stage trials involve comparison with current standard of care 60
Reducing the duration of treatment 61
Implications of new drug launches on clinical trial design 61

CHAPTER 5 INTERFERONS LATE-STAGE DRUG ANALYSIS & FORECASTS 63
Overview of the interferon class 63
Pipeline summary 65
Comparative forecasts 66
Pegylated interferon (peginterferon) combined with ribavirin is the current gold standard 66
Peginterferon therapy is associated with a high incidence of side effects and limited efficacy in genotype 1 patients 69
Albuferon (Novartis/Human Genome Sciences) 69
Drug overview 69
Clinical trial data 70
Phase III studies 70
Phase IIb studies 71
Phase II studies 73
Marketing factors 73
Patient potential 74
Satisfaction of unmet needs 75
Forecasts to 2017 75
Locteron (Biolex) 76
Drug overview 76
Clinical trial data 77
Phase IIb - SELECT 2 trial 77
Phase IIa - SELECT-1 trial 77
Phase IIa - PLUS trial 78
Marketing factors 78
Patient potential 79
Satisfaction of unmet needs 79
Forecasts to 2017 79
IFNalpha-2b XL (Flamel Technologies) 80
Drug overview 80
Clinical trial data 80
Phase II studies 80
Datamonitor comments 82
Other drugs in the interferons class 82
Omega-interferon (Intarcia) 82

CHAPTER 6 SMALL MOLECULE ANTIVIRALS LATE-STAGE DRUG ANALYSIS AND FORECASTS 84
Overview for the small molecule antivirals class 84
Resistance to new hepatitis C virus antivirals is an emerging issue 85
Pipeline summary 87
Comparative forecasts 91
Hepatitis C virus NS5B polymerase inhibitors 93
Pipeline overview 93
R7128 (Roche and Pharmasset) 96
Drug overview 96
Key clinical trials 96
Datamonitor comments 99
Forecasts to 2017 99
GS-9190 (Gilead) 100
VCH-916 101
PF-868554 102
Hepatitis C virus NS3/4A protease inhibitors 102
Pipeline overview 103
Telaprevir (Vertex and Tibotec) 106
Drug overview 106
Key clinical trials 106
Marketing factors 113
Patient potential 113
Satisfaction of unmet needs 113
Forecasts to 2017 114
Boceprevir 115
Drug overview 115
Key clinical trials 115
Marketing factors 120
Patient potential 120
Satisfaction of unmet needs 121
Forecasts to 2017 123
Protease inhibitors in early stage development 124
TMC435350 (Tibotec/Johnson & Johnson) 124
Key clinical trials 124
Datamonitor comments 125
R7227/ITMN-191 (Roche and InterMune) 126
Key clinical trials 126
Datamonitor comments 127
BI 201335 127
Other small molecule antivirals 128
Pipeline overview 128
Taribavirin (Valeant Pharmaceuticals) 130
Key clinical trials 130
Datamonitor comments 134
Forecasts to 2017 135
BMS-790052 (Bristol Myers Squibb) 135

CHAPTER 7 IMMUNOMODULATORS (NON-INTERFERON) LATE-STAGE DRUG ANALYSIS 137
Pipeline overview 137
Product profiles 139
Zadaxin (SciClone Pharmaceuticals) 139
SCV-07 (SciClone Pharmaceuticals) 139
Bavituximab (Peregrine Pharmaceuticals) 140
Civacir (Nabi Biopharmaceuticals) 140
Alinia (Romark Laboratories) 141
IPH 1101 (Innate Pharma) 141
CYT 107 (Cytheris) 142

CHAPTER 8 THERAPEUTIC VACCINES LATE STAGE DRUG ANALYSIS 143
Overview for the therapeutic vaccines class 143
Pipeline overview 144
IC41 (Intercell and Novartis) 146
Key clinical trial data 146
Phase II monotherapy study 146
Phase II combination study 147
Datamonitor comments 147
GI-5005 (GlobeImmune) 147
Drug overview 147
Key clinical trials 148
Phase II 148
Phase Ib 148
Datamonitor comments 149
ChronVac-C (Tripep and Inovio) 149
Drug overview 149

CHAPTER 9 HOST ENZYME INHIBITORS 151
Pipeline overview 151
Celgosivir (MX-3253; Migenix) 153
Debio-025 (Debiopharm) 154
NIM-811 (Novartis) 154
BIBLIOGRAPHY 155
Journals 155
Websites 157
Others 160
Datamonitor reports 164

APPENDIX 165
Methodology 165
Product forecasts 165
Definition of a standard unit (only use if ForeSight model used to forecast) 166
Forecasts for new drug classes (telaprevir, boceprevir, R-7128) 166
Pricing assumptions 166
Calculation of volume 168
Contributing experts 172
About Datamonitor 173
About Datamonitor Healthcare 173
Datamonitor Healthcare's therapy area capabilities 174
About the Disease analysis team 174
Key therapy team members 176
Holger Rovini, Lead Analyst, Infectious Diseases and Respiratory 176
Disclaimer 177

List of Tables
Table 1: Key parameters of HCV for the seven major markets 6
Table 2: Forecast key pipeline products in HCV in 2017 ($m) 7
Table 3: Overview of products in Phase I-III development 20
Table 4: Overview of hepatitis C virus pipeline drugs included in Datamonitor's forecasts, 2008 22
Table 5: Prevalence of Hepatitis C in Spain 46
Table 6: Estimated number of HIV/HCV co-infected patients by country in the seven major markets, 2008 52
Table 7: Overview of classes in development for hepatitis C virus, 2008 53
Table 8: Hepatitis C virus pipeline overview for the interferon class, 2008 64
Table 9: Overview of the result from the IDEAL study 68
Table 10: Resistant mutations associated with virus inhibitors 86
Table 11: Overview of small molecule antivirals in development 88
Table 12: Hepatitis C virus pipeline overview - NS5B polymerase inhibitors, 20072008 94
Table 13: Hepatitis C virus pipeline overview - NS3/4A protease inhibitors, 20072008 104
Table 14: PROVE-1 response rates for Telaprevir in hepatitis C virus 108
Table 15: PROVE-2 final analysis for Telaprevir in hepatitis C virus 110
Table 16: SVR12 rates for telaprevir-based 24 week regimen (group 1) in hepatitis C virus 111
Table 17: Interim results from the C208 study for Telaprevir in hepatitis C virus 112
Table 18: Adverse event-related discontinuations and virological breakthroughs by treatment arm for Telaprevir in hepatitis C virus in the C208 study 112
Table 19: Sustained virological response rates from SPRINT-1 study by treatment arm for boceprevir in hepatitis C virus 119
Table 20: Comparison of boceprevir and telaprevir SVR rates 122
Table 21: Hepatitis C virus pipeline overview -other small molecule antivirals, 20072008 129
Table 22: Taribavirin Phase IIb efficacy and safety data in hepatitis C virus 134
Table 23: Hepatitis C virus pipeline overview - immunomodulators (non-interferon), 20072008 138
Table 24: Hepatitis C virus pipeline overview - therapeutic vaccines, 2007 145
Table 25: HCV pipeline overview - host enzyme inhibitors, 2008 152
Table 26: Diagnostic split for US interferon and ribavirin sales 165
Table 27: Datamonitor drug assessment parameters 171

List of Figures
Figure 1: Datamonitor drug assessment summary of therapies in late stage development for HCV, 2008 8
Figure 2: Hepatitis C virus sales by region in the US, Japan and the 5EU, 2004-07 12
Figure 3: Evolution of chronic HCV therapy in the US since the launch of Intron A in 1991 14
Figure 4: Improvement in sustained virological response rates from monotherapy to combination therapy 17
Figure 5: Hepatitis C pipeline overview by drug class and phase, 2008 18
Figure 6: HCV pipeline overview 18
Figure 7: Estimated US launch dates of forecasted pipeline drugs for hepatitis C virus, 2008 23
Figure 8: HCV sales 2007-2017 by region 24
Figure 9: HCV sales or marketed drugs versus new drugs 2007-2017 25
Figure 10: Interferon sales 2003-2007 26
Figure 11: Market share of interferons in 2007 27
Figure 12: Interferon and ribavirin sales 2004-2007 28
Figure 13: The hepatitis C virus genome 32
Figure 14: Hepatitis C virus disease progression 33
Figure 15: Genotype distribution of hepatitis C virus across Europe, 2007 39
Figure 16: Hepatitis C virus - patient classification by response to treatment 41
Figure 17: Incidence of hepatitis C virus in the US, 1982-2006 43
Figure 18: Age-specific prevalence of anti-HCV antibodies in first-time blood donors in eight districts of Japan