Tag Archives: pbc

Intercept Pharma Drops On Downgrade, Despite FDA Panel’s Yes Vote

Shares of Intercept Pharmaceuticals ( ICPT ) were falling Friday after Morgan Stanley downgraded the stock, saying that a positive FDA panel vote nonetheless pointed toward a restrictive label for its lead drug. Trading in Intercept stock was halted all day Thursday as the advisory committee discussed obeticholic acid, now branded Ocaliva, eventually resulting in a 17-to-0 vote in favor of approving the drug to treat a rare liver disease called primary biliary cholangitis (PBC). The FDA will make a final decision on the drug, and what recommendations will be on its label, by May 29. Morgan Stanley analyst Andrew Berens wrote in a research note that issues raised during the panel discussion could limit the potential market. “The panel unanimously recommended to approve the drug based on the surrogate endpoint used in the phase 3 trial, but failed to endorse usage in advanced PBC patients given the lack of data supporting efficacy, as well as safety concerns,” Berens wrote as he downgraded Intercept stock to underweight from equal weight and lowered his price target to 80 from 100. “According to external consultants, the primary unmet medical need in this patient population is in patients with advanced or aggressive disease, so this lack of an endorsement by the panel has important commercial implications in our opinion, especially if the label is similarly restrictive,” Berens wrote. Berens added that the panel also expressed reservations about using the drug in patients with advanced cirrhosis, or scarring of the liver, due to signs of liver toxicity at high doses. He wrote that this could have implications for Ocaliva’s much-anticipated future launch in non-alcoholic steatohepatitis (NASH), a market that could potentially bring in billions. “We had previously assumed usage of Ocaliva in up to 20% of cirrhotic patients,” Berens wrote. “Given the concerns voiced by the clinicians and the FDA, we have decreased our penetration into NASH patients with cirrhosis to 5% at peak.” Intercept stock, which rose more than 8% Wednesday to a nearly four-month high, fell by as much as 10% in the stock market today . Shares were down 5.5% midday Friday, near 155. Other analysts generally stuck by their ratings on the stock. RBC Capital Markets analyst Michael Yee wrote that the possible PBC restrictions were in line with his below-consensus sales estimates for that indication, but he added that the company could still be an interesting buyout target for a big pharma name like AstraZeneca ( AZN ) or Sanofi ( SNY ). Credit Suisse analyst Alethia Young still says the PBC launch could beat expectations and wrote that the severe cases may not be that much of the market. “We think perhaps at worst the severe population is 15% of patients,” she wrote in her research note affirming an outperform rating. “Based on the super-group study, Intercept thinks 12% may be a high watermark.”

Intercept Pharma Gets Dueling Initiation Reports As FDA Panel Nears

Shares of biotech Intercept Pharmaceuticals ( ICPT ) were up in twice-average volume Wednesday, after two analysts launched coverage ahead of a crucial FDA panel vote. Credit Suisse’s Alethia Young initiated with a buy rating, while Salveen Richter at Goldman Sachs initiated with a neutral rating, though they agreed on the general outlines of the investment thesis. Intercept’s lead drug candidate, obeticholic acid (OCA), is up for an FDA advisory committee discussion on April 7 as a treatment for primary biliary cholangitis (PBC), a rare, chronic liver disease. If approved by the FDA’s May 29 deadline, it would be Intercept’s first commercial product. Young estimates that annual sales for obeticholic acid could hit $259 million in 2018, though Richter forecasts it at only $170 million at peak. Both analysts, however, agree that the really big potential market for OCA is in nonalcoholic steatohepatitis (NASH), a much more common liver disease without a current treatment. That could draw $3.5 billion a year, Richter estimates, but that’s a ways in the future: The next batch of data from the NASH clinical trial isn’t expected until 2018. Between the panel meeting and the NASH data, Richter sees “a dearth of catalysts” to drive Intercept’s stock, leading him to set his price target at 114. Young, however, says approval and launch for treatment of PBC, both in the U.S. and Europe, could provide more upside for the stock. Her peak sales estimate in NASH is almost twice Richter’s at $6.5 billion. She set her price target at 200. Intercept stock rose 5% in early trading on the stock market today , but by early afternoon it was up 1%, near 125.50. Shares hit a 19-month high above 314 last May.

Intercept Pharma Spikes On Report That It’s Exploring A Sale

Shares of biotech Intercept Pharmaceuticals ( ICPT ) spiked 30% in early-afternoon trading Friday on a report that the company is exploring a sale. Reuters cited anonymous sources in its report that Intercept has been working with investment bankers this week after it received interest from other companies. Reuters did not name any of the suitors, but Intercept has been a perpetual source of buyout speculation. Gilead Sciences ( GILD ) is a popular choice of buyer due to its overlapping work in liver diseases, and so are big pharmas working in that space such as Bristol-Myers Squibb ( BMY ), Johnson & Johnson ( JNJ ) and Merck ( MRK ). Intercept shares were up about 31% on the stock market today , near 123. An imminent deal would be oddly timed, however, given that Intercept’s lead drug is tied up in a long and uncertain FDA review. Initially the agency set a deadline of Feb. 29 to decide whether to approve Intercept’s obeticholic acid (OCA) for primary biliary cirrhosis (PBC). In December, however, the FDA pushed the deadline out to May 29 to provide time for an advisory committee, or adcom, to review and vote on the application on April 7. The FDA generally calls such committees when it has unresolved issues with the data. Intercept is also studying OCA for the potentially much bigger market in nonalcoholic steatohepatitis (NASH), but safety issues have arisen in its trials. “We doubt that Intercept could or would be acquired before at least an adcom panel to discuss the risk/benefit of the drug for PBC approval, and any indications of interest by an acquirer would be more to just do due diligence and explore scenarios and valuations first,” wrote RBC Capital Markets analyst Michael Yee in a research note. Yee added that an acquirer would likely have to pay up to $5 billion for Intercept but wouldn’t be able to make money off the deal for years since the drug is expected to ramp slowly. This uncertainty over the last few months has helped tamp down Intercept’s stock even more than other biotechs’, as it’s trading at only about a third of its May high of 314.88. Image provided by Shutterstock .