Utilizing its proprietary GEMS technology, PTC has identified a number of small molecules that selectively inhibit the translation of the hepatitis C virus protein without inhibiting human host cell translation in in vitro studies. In March 2006, PTC entered into an exclusive collaboration with Schering-Plough Corporation for the development and commercialization of the compounds in the hepatitis C program.

In in vitro testing, PTC's compounds specifically inhibited protein synthesis by interacting with the HCV IRES, did not inhibit normal cellular cap-dependent translation and did not display toxicity to cells. Notably, these compounds have displayed equal activity against the IRESs from all common HCV genotypes, including the genotype 1 strain of HCV.

Chronic hepatitis C is an inflammatory liver associated with chronic infection by the hepatitis C virus. It is the leading cause of liver failure requiring liver transplantation in both the United States and Europe. According to the World Health Organization, approximately 170 million people, or roughly 2.7% of the world's population, are chronically infected with HCV. The Centers for Disease Control, or CDC, estimate that more than 2.7 million people in the United States have chronic HCV infection and that approximately 8,000 to 10,000 patients die annually in the United States from complications resulting from this infection. According to the National Institutes of Health Consensus Development Conference Panel Statement the prevalence of cirrhosis and the incidence of its complications, including various forms of liver cancer and liver related deaths, will increase dramatically over the next 10 to 20 years. Hepatitis C is now the leading reason for liver transplantation in the United States.

There are no available vaccines against HCV. The current standard of care for the treatment of HCV is a combination of two drugs, interferon and ribavirin. More than 50% of patients infected with the genotype 1 strain of HCV generally do not respond to this therapy. In addition, there are significant side effects to this therapy, which often result in dose reductions or premature treatment termination.

The hepatitis C virus is an RNA virus with a viral genome that encodes all of the proteins required for viral reproduction. The HCV RNA does not have a 5' cap structure, but has a large 5' UTR that forms an extensive secondary structure harboring an HCV IRES. The HCV IRES initiates translation using a mechanism that is distinct from the cap-dependent translation involved in normal cellular protein synthesis. The HCV IRES has a critically important function in replication of the HCV virus. As a result, this sequence of RNA is present in all HCV genotypes. This makes the HCV IRES an attractive target for the development of a broad-spectrum anti-HCV agent that is potentially active against all HCV genotypes. Based on PTC's knowledge of the difference between HCV and host cellular protein synthesis, PTC has designed compounds that have selectively inhibited viral replication in several in vitro surrogate cell-based systems. Because the IRES is distinct from viral proteins targeted by existing drugs and other product candidates in development, such as protease or polymerase inhibitors, PTC's compounds may become useful as a single agent or in combination with other drugs.