Medco to Better Tackle Hepatitis C - Analyst Blog
July 06 2011 - 12:04PM
Zacks
Medco Health Solutions (MHS) is making attempts
to curtail costs of treating patients suffering from hepatitis C
(HCV). The company’s specialty pharmacy segment, Accredo Health
Group, considers patient adherence to the treatment most
significant as any contrary behavior could lead to liver cirrhosis
and certain cancers.
Accredo is optimistic about two new HCV medications --
boceprevir and teleprevir -- although the treatment process is
quite complex and requires greater degree of adherence.
In May 2011, Merck (MRK) received approval from
the US Food and Drug Administration (FDA) for Victrelis
(boceprevir) to treat chronic hepatitis C (CHC). The drug is
approved for the treatment of CHC genotype 1 infection, in
combination with peginterferon alfa and ribavirin, in adult
patients who were left untreated or failed previous interferon and
ribavirin therapy.
The FDA also approved Incivek (telaprevir), marketed by
Vertex Pharmaceuticals (VRTX), to treat certain
adults with CHC infection. The current standard of care for
patients with CHC infection is peg-interferon alfa and ribavirin
for 48 weeks. However, less than 50% of patients respond to this
therapy. It has been observed that the new treatments are more
effective and also shorten the duration of treatment to 24 weeks in
most patients.
To make the treatment effective, about 80-85% patient adherence
is required. It has been demonstrated that patients receiving
therapy from Accredo's nurses and specialist pharmacists are 10%
more receptive than others. Moreover, Accredo could reduce the cost
of therapy up to $13,000 by identifying patients who would require
only 24 weeks of therapy.
To ensure better adherence of patients, Accredo is educating
them regarding the usage of the medications. Moreover, the patients
are also being encouraged to communicate with doctors about the
treatment program and seek their assistance in managing side
effects. This helps to improve patient’s condition and do
away with the costly hospitalizations.
Over the past few quarters, Medco demonstrated successful
performance in its Specialty business segment primarily banking on
significant new client wins and continued growth across
Accredo.
During the first quarter of fiscal 2011 this segment reported
revenues of $3.1 billion, up 14.9% year over year. Presently, the
company is focusing on several strategic initiatives such as
improved product and channel mix along with new client wins to
drive the growth further.
We are currently Neutral on Medco which also corresponds to a
Zacks #3 Rank (Hold) in the short term.
MEDCO HLTH SOL (MHS): Free Stock Analysis Report
MERCK & CO INC (MRK): Free Stock Analysis Report
VERTEX PHARM (VRTX): Free Stock Analysis Report
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