Madrigal Pharmaceuticals, Inc.’s (MDGL - Free Report) shares skyrocketed 145% yesterday on encouraging top-line data from a phase II study evaluating its thyroid hormone receptor beta-selective agonist, MGL-3196, in non-alcoholic steatohepatitis (“NASH”). The candidate demonstrated sustained reduction in liver fat of 30% or more over nine months.
Madrigal successfully completed the mid-stage study and will advance the candidate to a phase III study following a regulatory agreement on its design.
The candidate had met the primary endpoint of 30% or more reduction in liver fat at week 12 in December last year.
Shares of the company have significantly outperformed the industry so far this year. While the stock has surged 189.4%, the industry has lost 6.5%.
Data from the study showed that MGL-3196 achieved higher reduction in NAFLD activity score (“NAS”) and greater NASH resolution in patients who have achieved 30% or more liver fat reduction at week 12. Moreover, 35% of the patients treated with MGL-3169 who had NASH resolution achieved a reduction of 5% or more in NAS compared to zero for placebo. The candidate also resolved fibrosis in half of patients with NASH resolution and led to statistically significant reduction in fibrosis compared to placebo.
Mean relative reduction in fat was 37% for MGL-3169 compared to 8.9% for placebo at week 36.
Per the press release, NASH is a common form of liver disease which is spreading gradually in the United States. There is no approved treatment for this disease.
Moreover, the company believes that the high degree of NASH resolution achieved by the candidate also increases the likelihood of its success in the advanced study. Also, MGL-3169 can resolve NASH in 30-40% patients in just nine months.
However, there are several other companies developing their candidates for this indication. Viking Therapeutics, Inc. , which is developing a thyroid receptor beta agonist, VK2809, in a mid-stage study for fatty liver, also gained more than 100% following the strong results of MGL-3169. Intercept Pharmaceuticals, Inc. (ICPT - Free Report) is developing its cholestatic liver drug, Ocaliva, in NASH in a late-stage study. The company’s stock however fell 4.6% as the drug has safety concerns, which may help MGL-3169 to get a lead over Ocaliva.
Big players like Gilead Sciences, Inc. (GILD - Free Report) and Allergan are also developing treatment for NASH.
Madrigal currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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