Needham Cuts Price Target On This NASH-Focused Stock As Its Awaits Visibility On Regulatory Path

Yesterday, Intercept Pharmaceuticals Inc ICPT announced data from the new interim analysis of the Phase 3 REGENERATE trial evaluating obeticholic acid in nonalcoholic steatohepatitis (NASH).
Needham writes that the efficacy results were similar to the initial results announced in February 2019.
Core cardiovascular and renal events were low and balanced across treatment arms, but hepatic events were higher.
According to the management, these events were manageable, with the majority mild in severity.
A pre-submission meeting with the FDA is planned this month, with resubmission anticipated.
The analyst says that concerns regarding the overall benefit/safety profile and how the FDA will view this new analysis remain in investors' minds.
Needham looks forward to visibility on the regulatory path. It lowered the price target from $25 to $22 (51% upside) but kept the Buy rating on the shares.
In the new analysis, 22% of patients achieved fibrosis improvement without NASH worsening in the 25mg group and 14.1% in the 10 mg arm compared to 9.6% on placebo.
The data is similar to the original analysis, which showed 23.% vs. 17.6% vs. 11.9%, respectively.
The placebo-adjusted treatment differences were similar: +11.2% original analysis vs. +12.8% new analysis.
The analyst thinks the data probably satisfies FDA's requirement for more consistency around the biopsy readings.
Price Action: ICPT shares are down 2.84% at $14.73 during the market session on the last check Friday.