What happened
Shares of clinical-stage biopharmaceutical company 89bio (ETNB -3.81%) were up 36.2% for the week as of Friday morning, according to data provided by S&P Global Market Intelligence. The stock is up more than 326% over the past 12 months. It closed last week at $12.44 and hit its 52-week high of $18.03 on Thursday.
So what
The healthcare company, which focuses on therapies to treat liver and cardio-metabolic diseases, released positive news regarding its lead therapy, pegozafermin. In a phase 2b study, a weekly 44-milligram dose and a weekly 30-mg dose of the drug both met the primary endpoints in treating patients with nonalcoholic steatohepatitis (NASH), a disease that causes the liver to swell and be damaged.
According to the American Liver Foundation, NASH affects about 1.5% to 6.5% of U.S. adults, roughly between 9 million and 15 million people. There are no Food and Drug Administration (FDA)-approved drugs to treat NASH.
Now what
The company has no revenue and lost $102 million in 2022. As of the fourth quarter, it reported $188.2 million in cash, so it will use the good news regarding pegozafermin to raise money through a stock sale, which it announced on Friday.
There's obviously a lot of risk with investing in the company, but it plans two phase 3 trials for pegozafermin in the second quarter. If those are successful, the company could have a breakthrough drug with blockbuster potential.
The drug is also in trials as a therapy for hypertriglyceridemia, when blood levels of triglycerides are too high, a condition that raises the risk of atherosclerosis and related heart diseases. Additionally, pegozafermin also has a large potential population, as hypertriglyceridemia affects 42% of adults 60 and over.
