La Jolla soars as kidney drug impresses in Phase II, but dosing questions linger

La Jolla Pharmaceutical's ($LJPC) chronic kidney disease drug hit its primary endpoint of improving organ function in a Phase II trial, the company said, and while the results sent the biotech's shares skyward by 75%, a quirk in dosing gave some analysts pause.

The study tested GCS-100 at two doses in 121 CKD patients, finding that the lower dose improved renal function at a statistically significant rate and met its secondary endpoint of cutting levels of galectin-3, a protein tied to tissue fibrosis. The higher dose, however, charted no statistically significant difference in either goal.

La Jolla blames the high-dose failure on what it calls a biologic feedback loop, with CEO George Tidmarsh telling investors that overinhibition of galectin-3 might spur the body to redouble production of the protein, negating GCS-100's effect. However, that explanation would appear to be inconsistent with the drug's Phase I results, in which La Jolla reported that a "statistically significant post-dose reduction of serum galectin-3 was also observed at the higher doses" of GCS-100.

But the dosing issue didn't scare off investors, who sent La Jolla's shares to an all-time high $19.17 in premarket trading on Wednesday, buying into the idea that GCS-100 could be the first drug approved for CKD, a big market with bigger unmet need.

"Chronic kidney disease is an enormous and growing medical problem worldwide," trial investigator and University of Texas professor Pablo Pergola said in a statement. "A disease-modifying agent that could slow and potentially reverse the tissue fibrosis that is a hallmark of this disease would be a welcome advance in the field and could have a major impact on patients' lives."

And Chardan Capital Markets analyst Ling Wang is all in on the drug's potential, telling Reuters that, if approved, it could gross more than $2 billion a year by 2024--"and that's a conservative estimate," she said.

On the safety side, both doses of GCS-100 were well-tolerated with no serious adverse events in the lower amount and two in the higher that were later deemed unrelated to the drug, La Jolla said.

- read the results
- here's the Reuters report

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