What happened
Shares of Akero Therapeutics (AKRO 4.28%) were down more than 70% for the week as of Thursday's close, according to data provided by S&P Global Market Intelligence. The healthcare stock closed last week at $50.33, then hit a 52-week low of $14.08 a share on Tuesday.
So what
Akero focuses on metabolic diseases. The clinical-stage biotech company saw its shares slump after it announced on Tuesday that efruxifermin, its lead pipeline candidate, missed its primary endpoint in a phase 2b study to treat nonalcoholic steatohepatitis (NASH). According to the company, patients with cirrhosis (scarring of the liver) due to NASH are unlikely to live longer than five years after diagnosis unless they receive a liver transplant. NASH is the most aggressive form of non-alcoholic fatty liver disease (NAFLD) and is a progressive disease that is expected to overtake hepatitis C as the most common reason for the need of a liver transplant.
Now what
The failure list of potential NASH therapies is a long one. The problem with many such therapies is they can lead to a buildup of toxicities that can negatively affect the liver and other organs. Efruxifermin is the only therapy Akero has in clinical trials, so the hit was a big one. Not all of the news from the trial was bad. Akero said that 22% of the patients at a lower dose of Efruxifermin (28 milligrams) and 24% of patients at the 50-milligram dose saw at least a one-stage improvement in liver fibrosis with no worsening of NASH by week 36, compared to 14% for placebo. The company's next step will be to see how the drug fares for a longer period of time. In the meantime, the company said it has a six-month net loss of $56.9 million and $658.9 million in cash, giving it a large window to develop efruxifermin.
