Akero Therapeutics, a biotechnology company based in South San Francisco, saw a significant drop in its stock value after revealing that its Phase 2b study of efruxifermin, the company's lead product candidate for nonalcoholic steatohepatitis (NASH), did not meet its key goal. NASH is a chronic liver condition characterized by the accumulation of fat in the liver.
The shares of Akero Therapeutics tumbled by two-thirds, reaching a 52-week low of $15.48 during Tuesday's trading session. The stock was valued at $15.65 at the time of reporting, reflecting a decline of nearly 68%. This decline also negatively impacted the stock of another company, 89bio, which is working on a NASH drug similar to efruxifermin.
While the Phase 2b study showed some improvement in fibrosis among patients with compensated cirrhosis due to NASH, it ultimately fell short of achieving statistical significance. However, Akero remains hopeful, stating that the study data suggests the potential for additional improvements in patients after a longer follow-up period of 96 weeks.
NASH Treatment Gap
Treating NASH has proven to be a significant challenge, as there are currently no drugs approved by the FDA for this condition. An estimated 17 million Americans are affected by NASH, which, if left untreated, can lead to cirrhosis and reduced survival rates. Akero emphasizes the critical need for effective treatment options, as only half of cirrhosis patients survive beyond five years without a liver transplant.
Analysts from SVB Leerink, Thomas Smith and Nat Charoensook, noted that despite missing the primary endpoint, Akero's study yielded the most effective dataset in a difficult-to-treat patient population. They believe that the sharp decline in the stock prices of Akero and 89bio is unwarranted. Although they do not cover Akero, they maintain an outperform rating on 89bio.