NGM Biopharmaceuticals (NGM) joined a raft of biotech companies with a failed hepatitis treatment on Monday, leading NGM stock to crash.
The biotech company was working on a treatment for non-alcoholic steatohepatitis, or NASH, an aggressive form of fatty liver disease. But the drug failed to improve fibrosis by at least one stage while keeping NASH symptoms in check. That was the primary goal of the study.
In morning trading on the stock market today, NGM stock collapsed 42.1% near 16.40. Now, the company says it will focus on its portfolio of drugs for eye disease and cancer. NGM said it won’t send the experimental NASH treatment into later-stage testing.
“These results are certainly disappointing, particularly given the dire unmet need in this patient population,” Chief Executive David Woodhouse said in a written statement. “The lack of significant fibrosis improvement was unexpected given the consistency of histology findings previously seen with (the drug called) aldafermin in our adaptive four-cohort Phase 2 study.”
NGM Stock Crashes
The news sent NGM stock crashing to its lowest point since September. Shares were consolidating with a buy point at 32.22, according to MarketSmith.com.
But NGM is far from the only name with a NASH failure under its belt. The disease is fairly tricky.
First, patients don’t show symptoms until their livers become extensively scarred and develop cirrhosis. Then, it can’t actually be diagnosed without an invasive liver biopsy. And, in order to gain U.S. approval, a drug must either improve fibrosis and keep NASH symptoms in check, or it must resolve NASH entirely and prevent fibrosis from worsening.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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