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Is Intercept Pharma's Updated Late-Stage NASH Data A Sell-The-News Event?

Shanthi Rexaline

Intercept Pharmaceuticals Inc (NASDAQ: ICPT) announced additional positive data from its pivotal Phase 3 REGENERATE trial Wednesday.

The trial is evaluating Intercept's obeticholic acid, or OCA, in patients with liver fibrosis due to non-alcoholic steatohepatitis, or NASH.

The new data being presented at the International Liver Congress in Vienna showed that OCA demonstrated robust efficacy across a range of additional histologic and biochemical parameters, according to Intercept. 

In February, the company released positive topline results from the study, sending its shares up by 6 percent on Feb. 19. 

What We Already Knew 

The once-daily OCA 25mg dose had met the primary endpoint of fibrosis improvement by one point or greater, with no worsening of NASH in 23.1 percent of patients compared to 11.9 percent of placebo patients at the planned 18-month interim analysis point.

Yet the proportion of patients in both OCA treatment groups achieving the primary endpoint of NASH resolution with no worsening of liver fibrosis — though numerically greater than with a placebo — did not achieve statistical significance.

The FDA had mandated that the candidate achieve one of the primary endpoints in order for the primary objective to be met.

The New Data 

The additional analyses showed that 13.3 percent of patients in the OCA 25mg group achieved an improvement of fibrosis by two points or greater compared to a placebo, at 4.5 percent.

In an analysis of changes in fibrosis by greater than or equal to one point, 38 percent in the OCA 25mg group showed improvement compared to 13.1 percent who worsened. 

Substantially more patients in the OCA 25mg group showed improvements in key underlying NASH features, including hepatocellular ballooning, and rapid and sustained reductions in key liver biochemistry parameters, including alanine aminotransferase and aspartate aminotransferase, according to Intercept. 

Analysts Bullish On Intercept 

"Overall, we think that all updates in the release were supportive of a real effect seen in 25mg vs placebo," Cantor Fitzgerald's Alethia Young said in a Thursday note.

Cantor has a an Overweight rating on Intercept with a $191 price target. 

On safety parameters, Intercept noted LDL cholesterol increasing with OCA treatment, peaking at 22.6mg/dL at 4 weeks and subsequently reversing and touching the baseline at month 18.

Serious cardiovascular events and incidents were balanced across the three arms, namely placebo (1 percent), OCA 10mg (1 percent) and 2 percent in OCA 25mg), the company said.

These rates are very low based on the size of the study, Cantor's Young said.

"Though crowded, we also think that NASH is a big market and Intercept's Ocaliva could be one of the first drugs approved for NASH," the analyst said. 

UBS Securities analyst Navin Jacob said that fibrosis improvement and NASH resolution all point to OCA being an active drug for NASH.

The data enhances the argument for approval, the analyst said. 

UBS has a buy rating on Intercept with a $139 price target. 

Intercept shares, which have gained roughly 8 percent since the start of April, were last seen sliding 13.17 percent to $104.79 Thursday. 

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Photo by Nephron/Wikimedia. 

Latest Ratings for ICPT

Date Firm Action From To
Mar 2019 Raymond James Maintains Strong Buy Strong Buy
Mar 2019 B. Riley FBR Maintains Buy Buy
Mar 2019 RBC Capital Upgrades Sector Perform Outperform

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