What happened
Shares of Ventyx Biosciences (VTYX -3.20%) were down more than 26% as of noon on Tuesday after investors were unimpressed by the healthcare company's phase 2 trial results for ulcerative colitis (UC) therapy VTX002. The stock is down more than 31% so far this year.
So what
Ventyx is a clinical-stage biotech company that focuses on oral medicines to treat autoimmune and inflammatory disorders. The company's lead therapy candidate is VTX002. On Monday, Ventyx reported week 13 phase 2 trial details for VTX002 for patients with moderate-to-severe ulcerative colitis.
The company said that 28% of patients on the 60-milligram dose and 24% of patients on the 30-milligram dose achieved the primary endpoint of clinical remission at Week 13, compared to 11% of patients using a placebo. The company also said the drug showed a strong safety profile.
The concern for investors is the drug didn't do enough to separate itself from two other S1P1 receptor modulators, bioactive lipid molecules that play an active role in the immune system, which are used as UC therapies. The two are etrasimod, which is sold by Pfizer, and Zeposia, which is sold by Bristol Myers Squibb.
Pfizer is awaiting to hear whether etrasimod will be approved to treat UC, while Zeposia earned Food and Drug Administration (FDA) approval in 2021 and had $250 million in sales last year. Through the first six months this year, it has reported $127 million in sales.
Now what
The drop may be a bit of an overreaction. Ventyx has four programs in its platform other than VTX002. Its VTX958 is in trials to treat psoriasis, psoriatic arthritis, and Crohn's disease.
The company doesn't have any revenue and reported a loss of $55.3 million in the second quarter, compared to $20 million in the same period a year ago. It has a decent cash position, though, saying it had $332.3 million as of the second quarter, enough to fund operations into 2025.
