Shares of Achillion Pharmaceuticals (ACHN) had gained about 10% for reporting positive results in a mid-stage trial of its hepatitis C drug ACH-3102 in combination with Gilead Sciences (GILD) drug Sovaldi -- also known as sofosbuvir. The trial enrolled 12 patients to test the combination of ACH-3102 together with Sovaldi to determine the efficacy of this combination of drug compounds. The results were outstanding because the combination of  ACH-3102 together with Sovaldi was able to achieve a 100% cure rate of the hepatitis C virus. All 12 patients had undetectable HCV -- Hepatitis C virus RNA levels for 4 weeks after completing the cycle of therapy. Hepatitis C virus RNA levels are the measure of how much of the virus is still left circulating in the blood of the patient.

There are two key components for why this combination study was important for Achillion Pharmaceuticals. For starters standard of care treatment for hepatitis C patients is adding a toxic chemical known as Ribavirin for clearing the virus from the body. Even then the cure rate for Ribavirin alone in hepatitis C isn't all that great, and leads to many unbearable side effects for the patients. The second thing to note is that this proves that ACH-3102 is able to be combined with a nucleotide NS5B Polymerase inhibitor-- which is what Sovaldi is.  ACH-3102 is an NS5A  inhibitor, and is a different compound from Sovaldi. The good news now though is that Achillion is also working on a similar drug compound for the hepatitis C virus known as ACH-3422 which is also a nucleotide NS5B Polymerase inhibitor.

This is good news for Achillion because now moving forward it can combine both ACH-3102 together with ACH-3422 into one drug compound. This could then potentially prove in later trials a 100% cure rate in the hepatitis C virus and be able to compete in the market against Sovaldi. We don't know yet because all is dependent on how well the two chemical drug compounds from Achillion go together, plus also it depends on how long the drug combination takes to cure the virus -- how many weeks of treatment. While that remains to be seen this initial positive result of combining ACH-3102 together with Gilead's Drug Sovaldi shows the potential for a combination of combining an NS5A inhibitor together wtih an NS5B inhibitor.

The hepatitis C market is huge, and Achillion may have a chance to be a part of this huge market if its ACH-3422 drug  proves to clear the hepatitis C virus by 100%. Sovaldi is selling well matter in fact the drug compound made$3.48 billion dollars in second quarter sales in 2014. Eventually Achillion may have an opportunity to capitalize on this market in the mean time shares of the company have surged as much as 184% year to date. We think that the continuation of successful results with the company's hepatitis C pipeline will bring in other big pharmaceutical players to attempt a buyout of the company. Many big pharmaceutical companies are looking to fill their pipelines with a hepatitis C drug compound. Buying Achillion Pharmaceuticals may be that way for these big pharmaceutical companies to get their foot in the door on this growing hepatitis c space. Therefore we believe that Achillion Pharmaceuticals will eventually be bought out for billions of dollars.