Why Intercept Pharmaceuticals Inc. Shares More Than Quadrupled

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Intercept Pharmaceuticals (NASDAQ: ICPT  ) , a clinical-stage biopharmaceutical company focused on developing therapies to treat chronic liver disease, exploded higher by as much as 320% (that's not a misprint) today following a clinical update on its phase 2b Flint trial involving obeticholic acid (OCA) as a treatment for nonalcoholic steathohepatitis (NASH), a disease characterized by fat accumulation in the liver which can lead to cirrhosis, the need for a transplant, or death.

So what: According to Intercept's press release, the data safety monitoring board has recommended the Flint trial be stopped early based on OCA meeting its primary endpoint and highly statistically significant improvement in liver histology. The DSMB reviewed liver biopsy data from roughly half of all trial patients and noted that the primary endpoint – a decrease in the NAFLD Activity Score of at least two points with no worsening of fibrosis – was met.

Now what: In my 15 years of investing, I can recall but a handful of instances where I've seen a non-micro-cap or small-cap company explode higher by 320% in a single session – and certainly none of them moved higher by $230 per share! There are obviously huge implications here for OCA given that an estimates 12% of the U.S. population has NASH and some 6 million people in the U.S. are projected to have advanced liver fibrosis or cirrhosis, which is where OCA could be of incredible benefit. Then again, I am a realist, and a $200-plus move higher better come with absolutely utopian clinical data and execution from here on out or it will be clobbered. As much as today's move is exciting and reminds investors of the potential of the biotech sector, I'm sticking to the sidelines.

Can this top stock follow in Intercept's footsteps in 2014?
There's a huge difference between a good stock, and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report: "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.


Read/Post Comments (2) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 09, 2014, at 1:32 PM, marp11 wrote:

    arna will jump 300% this year...but a bit slower.

    check with osmelli for the scoop.

  • Report this Comment On January 10, 2014, at 10:41 AM, TheoryMeltFool wrote:

    And it's up another %50+ today (55%) at time of writing.

    This is one that I'll be watching, and I might short it for now.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2789460, ~/Articles/ArticleHandler.aspx, 12/21/2014 1:47:39 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 17,804.80 26.65 0.15%
S&P 500 2,070.65 9.42 0.46%
NASD 4,765.38 16.98 0.36%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

12/19/2014 4:00 PM
ICPT $156.63 Up +6.49 +4.32%
Intercept Pharmace… CAPS Rating: **

Advertisement