What happened

Shares of FibroGen (FGEN -3.70%) dropped more than 26% today after the company reported top-line results from a phase 3 clinical trial. The data are from pooled safety analyses of roxadustat, a drug candidate for treating anemia in chronic kidney disease (CKD) patients, and they weren't communicated as clearly as investors and analysts had hoped.

Seemingly contradictory phrases in the press release and statements on the first-quarter 2019 earnings conference call left room for Wall Street to cast the top-line results in a negative light. Reporting from FierceBiotech takes the "glass half full" perspective, noting that Jefferies analysts think the company's choice of certain words and phrases made the data appear worse than they are. But not everyone on Wall Street is so sure.

As of 1:58 p.m. EDT, the stock had settled to a 22.5% loss.

An investor with his face in his palm and a declining stock chart next to him.

Image source: Getty Images.

So what

FibroGen evaluated the time to the first major adverse cardiac event (MACE) from patients taking roxadustat and those taking either Epogen from Amgen or placebo. The head-to-head safety comparison was made in three distinct patient populations, but the results weren't so straightforward.

Patient Population

Roxadustat Compared to...

Met Statistical Threshold for Noninferiority

Further Comments

Dialysis-dependent CKD = 4,000 patients



"We believe there is no clinically meaningful difference in risk."

Newly initiated dialysis CKD = 1,500 patients



"There is a trend toward reduced risk for patients on roxadustat."

Non-dialysis-dependent CKD = 4,300 patients



"We believe there is no clinically meaningful difference in risk."

Data source: Press release.

The press release stated that the largest of three patient populations didn't meet the statistical threshold specified in the study to claim that the drug candidate is noninferior to Epogen, but the company said it believed there was "no clinically meaningful difference in risk."

When asked about this subtle but important difference on the conference call, CEO Thomas Neff stated that the U.S. Food and Drug Administration had not agreed on the statistical threshold for noninferiority in the first place. That left analysts thinking regulators could question the drug candidate's safety profile, especially since it likely has to be as safe as erythropoiesis-stimulating agents such as Epogen to be approved.

Now what

It's going to take time for investors to sort this one out. FibroGen and its partners, AstraZeneca and Astellas, plan to file a new drug application including the safety data. Given all the confusion, management might make an extra effort to communicate the subtleties of the complex results again in the near future.