Intercept liver drug meets main goal in study, shares quadruple
(Reuters) - Intercept Pharmaceuticals Inc's drug to treat liver disease caused by fat buildup was found effective in a trial, paving the way for it to become the first approved treatment for the chronic condition.
The company's shares nearly quadrupled to a life high of $305 on Thursday morning on the Nasdaq, valuing the company at about $6 billion.
Intercept said it had stopped the trial after the drug showed statistically significant improvement in patients, compared with a placebo, in a review by an independent safety committee.
The trial tested the drug, obeticholic acid, in patients with non-alcoholic steatohepatitis (NASH), a form of liver inflammation.
Analysts said the news came as a surprise to investors, who had previously focused on the drug as a treatment for primary biliary cirrhosis, an autoimmune disease in which bile ducts in the liver are destroyed. The drug is being tested for the condition in a late-stage study.
"We didn't expect this data until the fourth quarter," Wedbush analyst Liana Moussatos said. "It's a huge opportunity for the company as there are over 10 million patients worldwide."
Moussatos said Intercept could tie up with Big Pharma companies to conduct a late-stage trial of the drug. Intercept could also conduct a late-stage trial with its partner Dainippon Sumitomo Pharma, which is testing the drug in Japan, she said.
Obeticholic acid, Intercept's lead drug, is also being tested in mid-stage studies to treat bile acid diarrhea and portal hypertension, which is high blood pressure in veins that transport blood from the gastrointestinal tract and spleen to the liver.
The drug's structure is similar to that of a naturally occurring human bile acid.
Intercept said the safety committee made the recommendation after reviewing liver biopsy data from about half of the 283 patients enrolled in the mid-stage trial.
There is currently no specific treatment for NASH, according to the U.S. National Institutes of Health.
To manage the disease, patients are recommended to maintain a healthy weight, follow a balanced diet, increase physical activity and avoid alcohol.
(Reporting by Vrinda Manocha in Bangalore; Editing by Kirti Pandey)