Inhibitex (Nasdaq: INHX) Shares Soar as Investors See Another Pharmasset in the Making

Tallahassee, FL 11/4/11 (StreetBeat) -- Shares of Inhibitex (Nasdaq: INHX) more than doubled Friday morning after the company released promising new data on its hepatitis C drug candidate.

The Inhibitex drug INX-189 belongs to the same "nucleoside" class of potent oral hepatitis C drugs as Pharmasset's (Nasdaq: VRUS) heralded PSI-7977. The difference, of course, is that Inhibitex's market value is $300 million, or at least it was going into Friday's trading. Pharmasset's market value is close to $6 billion.

Investors are hoping that the magical Hep C pixie dust that has made Pharmasset the best-performing biotech stock this year will work its charms on Inhibitex as well.

Inhibitex shares soared 133% to $9.25 in pre-market trading after the company reported a 4.25 log drop in Hep C viral load after 7 days of treatment with a 200mg dose of INX-189 in treatment-naive patients. No serious adverse events were reported. That result is comparable to the viral load decline demonstrated by Pharmasset's PSI-7977 in an earlier study.

Nucleoside or "nucs" have become the belles of the Hep C drug ball because of their potential as a backbone of future all-oral combination Hep C therapy. Pharmasset's nuc PSI-7977 has garnered the most attention, but companies like Inhibitex and Idenix Pharmaceuticals (Nasdaq: IDIX) are also developing their own Hep C nucs.

Pharmasset shares were down 4% to $74.80 in early Friday trading, likely due to competitive concerns stemming from the INX-189 data. In Friday's release, Inhibitex said it was moving forward with new studies of INX-189 including one in combination with an another undisclosed direct-acting antiviral Hep C drug.

The new Inhibitex data on INX-189 comes on the eve of the American Association for the Study of Liver Disease (AASLD) annual meeting, which will feature important presentations of new hepatitis C drug research.

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