(Reuters) - The U.S. Food and Drug Administration has declined to approve Intercept Pharmaceuticals Inc’s therapy for a progressive liver disease, the company said on Monday, sending its shares tumbling 40% in early trading.
The FDA has sought additional post-interim analysis data from an ongoing late-stage trial in support of the marketing application as it found predicted effectiveness of the treatment failed to outweigh its potential risks. (reut.rs/2ZhKnbP)
The therapy, chemically known as obeticholic acid, is designed to improve fibrosis, or the build up of scar tissue in the liver caused by non-alcoholic steatohepatitis (NASH), a chronic disease related to obesity.
Intercept said the FDA’s decision was premature and disagreed with the denial of approval based on the treatment’s effectiveness.
The company said there was a lack of clarity regarding what efficacy data FDA is looking for, adding that the agency never said the drug was unapprovable.
“We are very concerned that the agency’s apparently still evolving expectations will make it exceedingly challenging to bring innovative therapies to NASH patients with high unmet medical need,” Chief Executive Officer Mark Pruzanski said.
NASH, which affects around 5% of Americans and is poised to become the leading cause of liver transplants, has currently no approved treatment.
As fat-filled diets make bigger chunks of the global population prone to developing the disease, some analysts expect the market for NASH drugs to reach up to $35 billion.
“(The decision) potentially raises the bar for all NASH companies and makes it a bit more murky as to what FDA wants to see for approvals in NASH,” Jefferies analyst Michael Yee said.
The industry has been littered with disappointments, including last year’s trial failure of Gilead Sciences Inc’s three-drug combination.
(This story corrects prevalence of NASH in U.S. to 5% from 25% in paragraph seven)
Reporting by Saumya Sibi Joseph and Trisha Roy in Bengaluru; Editing by Maju Samuel and Arun Koyyur