Intercept jumps after Phase 3 NASH study meets primary endpoint

News comes after competing drug failed late-stage trial

Shares of Intercept Pharmaceuticals (ICPT) jumped in morning trading after the company said its experimental medicine to treat the fatty liver disease known as nonalcoholic steatohepatitis, or NASH, met a primary endpoint in a Phase 3 clinical trial.

DRUG TRIAL RESULTS: Intercept Pharmaceuticals said Tuesday that obeticholic acid, or OCA, an experimental medicine to treat the fatty liver disease known as NASH, achieved its primary endpoint in the Phase 3 Regenerate clinical trial. The study enrolled 931 patients diagnosed with stage 2 or 3 liver fibrosis due to NASH, confirmed with a liver biopsy. The patients were randomized to treatment with one of two doses of OCA or a placebo for 18 months.

According to Intercept, 23.1% of the patients on the higher OCA dose showed a statistically significant reduction in liver fibrosis, or scarring, compared to 11.9% of the placebo patients. The study met one co-primary endpoint, a statistically significant proportion of patients achieving at least one stage improvement in fibrosis with no worsening of NASH at month 18, but failed to meet the other, the proportion of patients achieving NASH resolution with no worsening of liver fibrosis. The Food and Drug Administration agreed that only one endpoint needed to be met in order to be judged successful, Intercept said.
EXECUTIVE COMMENTARY: “We are thrilled to report the first positive registrational Phase 3 study results in patients with NASH, a devastating disease that is on track to become a leading cause of liver transplant in coming years. The topline REGENERATE data we are reporting today support our belief that OCA will become the first approved medicine for those living with liver fibrosis due to NASH. We are deeply grateful to the patients, investigators and study staff whose ongoing participation in REGENERATE has brought us one step closer to delivering a much-needed therapeutic option to address the enormous unmet medical need in this population,” said Mark Pruzanski, M.D., President and CEO of Intercept. Based on the study’s results, Intercept said it would file marketing applications for the treatment in the U.S. and Europe in the second half of the year.  OCA remains the only investigational drug to have received Breakthrough Therapy designation from the FDA for NASH with fibrosis, the company noted.

WHAT’S NOTABLE: A competing NASH drug from Gilead Sciences (GILD) failed a Phase 3 clinical trial last week. On February 11, Gilead said selonsertib did not meet its primary endpoint in Stellar-4, the Phase 3, placebo-controlled trial investigating its safety and effectiveness in compensated cirrhosis. The study failed to meet the primary endpoint of the proportion of participants achieving at least a one-stage improvement in NASH classification after 48 weeks of treatment, it said. Specifically, 14.4% of patients receiving 18 mg of selonsertib and 12.5% of those receiving 6 mg achieved at least a one-stage improvement in NASH compared to 12.8% for placebo.

ANALYST COMMENTARY: Following the announcement, Wells Fargo analyst Jim Birchenough raised his price target on Intercept to $127 from $75. In a research note to investors, Birchenough said that while the Phase 3 Regenerate study met the “more important” of the two co-primary endpoints, the analyst believes that overall effect size is relatively small with 11% absolute improvement over placebo, and that high rate of pruritis, imbalance in study discontinuation and imbalance in serious liver events/gallstones could present some regulatory risk and limit commercial uptake. Birchenough would await further REGENERATE details on statistical methods used, potential subset results and nature of liver adverse events to further assess any regulatory risk and commercial opportunity.

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