Intercept's much-hyped NASH drug misses the mark in Phase II

Intercept Pharmaceuticals' ($ICPT) new drug for the pervasive liver disease NASH came up short in a Phase II trial in Japan, seeding some worries about an ongoing late-stage study designed to support future FDA approval.

Sumitomo Dainippon Pharma, Intercept's partner in Japan, tested three doses of the drug against placebo in a 200-patient trial, surveying whether the treatment, obeticholic acid, could register a two-point improvement on a common measure of liver disease without worsening scarring. Across the board, Intercept's drug failed to get a statistically significant number of patients to that goal, with only the highest doses, 20 mg and 40 mg, clocking a p value under 0.05. The drug also failed to reach statistical significance on secondary endpoints including liver fat, inflammation, ballooning and resolution of NASH symptoms, Intercept said.

Intercept's share price fell about 14% on the results Tuesday morning on concerns that the drug, abbreviated OCA, may struggle to replicate its earlier Phase II success as its 2,000-patient Phase III trial gets underway.

Last month, Intercept began enrollment in a global study testing 10 mg and 25 mg of OCA versus placebo with primary endpoints of improving NASH symptoms, reducing liver scarring, and preventing death and end-stage liver disease. Final data won't be ready until 2021, but Intercept has scheduled an interim analysis in 2017 that will evaluate how well OCA is doing at resolving NASH and reducing scars in about 1,400 patients and plans to submit those results to the FDA for a shot at early approval.

NASH, short for nonalcoholic steatohepatitis, is a fatty liver disease estimated to affect as many as 5% of Americans and is on pace to become the the leading cause of liver transplants by 2020, according to Intercept. The disease has no approved treatments, creating a potential blockbuster market that has galvanized a major R&D push among biopharma companies.

With OCA, Intercept remains in first place among those working to develop drugs for NASH. Behind it, French biotech Genfit is blueprinting a Phase III trial for a similar treatment, while Gilead Sciences ($GILD), Enanta Pharmaceuticals ($ENTA) and a host of other companies advance NASH therapies of their own.

Intercept's drug is closer to the market in its secondary indication of primary biliary cirrhosis, a rare disease that results in serious liver damage. Under the FDA's priority review program, the drug is up for approval by the end of February in that disease.

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