With Important Trial Results Due in June, Is This Drugmaker a Good Buy Now?
Founded in 2002, Intercept Pharmaceuticals (NASDAQ: ICPT) is a biotech company whose only drug treats liver diseases. Intercept's drug, obeticholic acid, was approved by the U.S. Food and Drug Administration (FDA) in 2016 for treating primary biliary cholangitis, a chronic disease that destroys bile ducts. However, the company has seen difficulty in expanding that approval to treating nonalcoholic steatohepatitis (also known as NASH). In fact, in June 2020, instead of approval, the FDA requested more safety and efficacy data on the drug. NASH affects millions of people and Intercept has been running a NASH phase 3 trial since 2015, so management initially thought it had enough evidence for approval.
On the day of the negative news, the stock price plummeted from $77 to $47; it's currently trading at about $21. With clarified clinical trial results coming out in June, there is ample reason for investors to worry.
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Source Fool.com
