Shares in Vertex Pharmaceuticals plunged 12% in Wednesday’s extended market session after the pharma company announced the decision to stop the development of its VX-814 for the treatment in patients with alpha-1 antitrypsin deficiency (AATD), which is a genetic disorder increasing the risk for lung and liver disease.
Vertex (VRTX) said that based on the safety and pharmacokinetic (PK) profile of VX-814 observed to date in a Phase 2 study, the company decided to halt trial dosing and will discontinue its development. Analysis of the PK data from the study indicated that exposures achieved were low and therefore Vertex concluded that it would not be feasible to safely reach targeted exposure levels. Vertex is considered the leader in the treatment of cystic fibrosis, a genetic disease that can severely affect lungs, pancreas and other organs.
“Based on the liver enzyme elevations observed, along with the determination that we would not be able to safely achieve targeted exposure levels with VX-814, we are discontinuing further development of this molecule,” said Vertex Chief Medical Officer Carmen Bozic. “We are grateful to the AATD patients and investigators who participated in the VX-814 studies and we remain committed to transforming the treatment of this disease. We look forward to continuing clinical study of VX-864 and other molecules targeting the underlying cause of AATD.”
The randomized, double-blind, placebo-controlled Phase 2 study of about 50 patients was designed to evaluate the safety and PK of VX-814, and the ability of VX-814 to increase functional levels of alpha-1 antitrypsin over 28 days of dosing. Elevated liver enzymes were observed in several patients. In 4 patients, across different doses studied, elevations greater than 8 times the upper limit of normal were noted.
Vertex added that the company will continue to advance multiple small molecule correctors in late stage research with a goal of advancing at least one additional molecule into development in 2021.
VRTX shares have already gained 24% this year with the $307.38 average analyst price target indicating 13% upside potential lies ahead. That’s with a cautiously optimistic Moderate Buy analyst consensus showing 11 Buys and 5 Holds.
Merrill Lynch analyst Geoff Meacham reiterated a Buy rating on the stock with a $325 price target, calling the share move reaction “overdone”.
“News that the VX-814 trial was stopped early due to safety concerns is certainly a blow to the strategy to diversify the pipeline outside of cystic fibrosis,” Meacham wrote in a note to investors.
However, “Vertex’s strategy of bringing multiple products into the clinic simultaneously provides a hedge against unexpected safety issues such as this,” the analyst added. “We would consider the weakness a buying opportunity for Vertex shares given the strong base business and emerging pipeline.” (See VRTX stock analysis on TipRanks)
Related News:
PerkinElmer Raises 3Q Sales Outlook Fueled By COVID-19 Testing Demand
J&J Halts Covid-19 Vaccine Trial Due To ‘Unexplained Illness’
Pfizer, BioNTech Initiate Rolling Canada Submission For Covid-19 Vaccine
