Galmed plunges after failed AIDS drug trial

drug development

The company is still testing its drug for treatment of fatty liver.

Galmed Pharmaceuticals Ltd. (Nasdaq: GLMD) has announced the failure of its Phase II trial of its treatment for liver inflammation in AIDS patients. The company today published an announcement that the product had not achieved its main target in a trial on 50 patients lasting 12 weeks. No difference was found in the proportion of fat in the liver (a risk factor for inflammation) among the AIDS patients treated with Galmed's product in comparison with those not treated with the drug.

Galmed's share price plunged 63% before the start of Nasdaq trading. If the trend persists after the start of trading, Galmed's market cap will fall to only $44 million.

The drug tested is Aramchol, Galmed's leading drug, but the trial in question is not the main trial being conducted by the company. The main trial is a multi-center trial conducted on 248 patients with liver inflammation resulting from fatty liver (with no connection to AIDS). This trial monitors the patients for 52 weeks, and measures not only the proportion of fat in the liver, but also uses a biopsy to measure the levels of inflammation.

The objective in both trials was to reduce the inflammation by lowering the levels of fat in the liver, but the trials differ in their scope, their duration, the form of the test, and the patients' disease mechanism. The fact that Galmed failed in the trial on AIDS patients therefore makes it less likely that the main trial will succeed, but does not eliminate this possibility. Initial results from the main trial are expected in the coming months.

Galmed hoped that its trial would demonstrate early and less expensive proof of the practicability of its drug's activity. The company is now emphasizing the difference between the trials. "It is possible that the treatment for fatty liver disease linked to AIDS or drugs for treatment of AIDS is more difficult that treatment for fatty liver among the general population,"Galmed president and CEO Allen Baharaff said in his company's press release.

If Galmed succeeds in its main trial, the failure of the trial on AIDS patients will not be significant, because inflammation resulting from fatty liver constitutes a huge market. The importance of the result for investor is therefore mainly as an indicator of the main trial's chances of success. Baharaff previously said that even if the results of the company's Phase IIb trial were not unequivocal, it would be able to continue on to a Phase III trial, as other companies in the sector have done. If the results are as unequivocal as today's results, on the other hand, it will probably signal the end of the company, or at least a significant change in it.

Published by Globes [online], Israel Business News - www.globes-online.com - on February 14, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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