s per STAT:
The entire world has been waiting for results from Gilead’s clinical trials, and positive results would likely lead to fast approvals by the Food and Drug Administration and other regulatory agencies. If safe and effective, it could become the first approved treatment against the disease.
The scuttlebutt obtained by STAT strongly suggests the drug is both effective and safe (although the number of patients is way too small to say much about the latter). Remdesivir has also been trialed for Ebola and there were no serious side-effects that could be attributed to the drug. Whether it is safe and/or safe for all types of patients is a question that is hard to answer.
The STAT article is about two clinical trials where The University of Chicago Medicine recruited 125 patients. 113 with severe forms of COVID-19. All the patients were treated with daily infusions of remdesivir.
STAT has a quote on tape (made during a video conference) by Kathleen Mullane, the University of Chicago infectious disease specialist overseeing the remdesivir studies for the hospital:
The best news is that most of our patients have already been discharged, which is great. We’ve only had two patients perish
I've discussed mortality rates in more depth here. Among the hospitalized, the default rate is far above the average. I'd say it is likely at least around 15% (much is dependent on the exact make-up of a population) and that could have resulted in 19 fatalities here. Instead, there were two.
In a statement Gilead has added: “What we can say at this stage is that we look forward to data from ongoing studies becoming available.”
Gilead has been very discreet about the promising nature of Remdesivir. However, sometimes you can read between the lines of their comments. Why would you make a statement like this if you know the drug is a failure. You would make a different statement. Gilead has shown zero interest in promoting its own stock or something like that. They've been genuine and serious. Will give away 1.5 million doses of the drug. I'm inclined to believe that if they look forward to releasing the data, the data is favorable. Official data is likely to follow in April. STAT suggests any day.
The publication adds that:
Mullane, while encouraged by the University of Chicago data, made clear her own hesitancy about drawing too many conclusions.
“It’s always hard,” she said, because the severe trial doesn’t include a placebo group for comparison. “But certainly when we start [the] drug, we see fever curves falling,” she said. “Fever is now not a requirement for people to go on trial, we do see when patients do come in with high fevers, they do [reduce] quite quickly. We have seen people come off ventilators a day after starting therapy. So, in that realm, overall our patients have done very well.”
She added: “Most of our patients are severe and most of them are leaving at six days, so that tells us duration of therapy doesn’t have to be 10 days. We have very few that went out to 10 days, maybe three,” she said.
Coming off ventilators is very important. There is a global shortage of these things and if Remdesivir could just get patients off these faster that's already a win. But together with the effect on the fever it does suggest impact. In earlier data that I've discussed in the prior articles, we've seen similar responses but in extremely limited sample sizes. We've also observed treatments of very ill and at-risk patients that did not show such quick favorable responses to treatment.
STAT also asked Eric Topol, director of the Scripps Research Translational Institute, about the data:
The severely hit patients are at such high-risk of fatality. So if it’s true that many of the 113 patients were in this category and were discharged, it’s another positive signal that the drug has efficacy,
Finally, also hinting that the 5-day treatment may be sufficient for most patients if not everyone. That's super important because it effectively doubles the production capacity of treatments from the standard 10-day treatment. If the drug proves to be effective, available quantities will remain an issue. Not in terms of the numbers of sick people you see in the U.S. today. But if you want to open up society because you have a treatment that brings fatalities down very seriously you will see a surge in treatments required.
The company has had quite a run from mid $60;s when I started writing about Remdesivir (which I viewed as a freeroll) but at 10.3x free cash flow and 14.6x EV/EBITDA the company and that's all without any revenue from Remdesivir incorporated yet, valuations aren't stretched. But to count on a high rate of return from here I think you have to expect COVID-19 to become an endemic disease, competitors like chloroquine to fall short of expectations or significant undervaluation based on its HIV and HCV franchises.
Check out the Special Situation Investing report if you are interested in uncorrelated returns. I look at mergers & acquisitions, spin-offs, companies with buyback programs, rights offerings as well as unique opportunities like Gilead today, which is so well positioned with its Remdesivir cure.