Wall Street rejoiced over Intercept Pharmaceuticals Inc.’s stoppage for efficacy of the FLINT Phase IIb trial with obeticholic acid (OCA) for the treatment of non-alcoholic steatohepatitis (NASH) – “the coming tsunami of liver disease,” said CEO Mark Pruzanski.

New York-based Intercept’s shares (NASDAQ:ICPT) closed Thursday at $275.87, up $203.48, or 281 percent, on news that FLINT had met its primary endpoint.

Whether Intercept will prepare a new drug application (NDA) package based on FLINT and other data likely would be “one of the top questions” in a late Thursday conference call with investors, predicted James Molloy, analyst with Janney Montgomery Scott. “I’m not sure myself if this is fileable with just the Phase IIb data or not, but it likely shortens the timeline,” he told BioWorld Today.

During the call, it was part of the first question.

“The regulatory path in NASH in the U.S. is as yet undefined,” Pruzanski said, although the FDA has been proactive in setting up a workshop last September, which brought industry and academia together for a “very robust discussion” regarding drug development in a “huge unmet need.” The National Institute of Diabetes & Digestive & Kidney Diseases, part of the National Institutes of Health, proposed and designed the study, he noted.

A data safety monitoring board found OCA provided a highly statistically significant improvement (p = 0.0024 on an intention-to-treat basis) in the primary histological endpoint: a decrease in the non-alcoholic fatty liver disease activity score of at least two points with no worsening of fibrosis, as compared to placebo.

Though it may have few symptoms, NASH is a serious chronic buildup of fat in the liver that can lead to cirrhosis and death. Estimates suggest 2 percent to 5 percent of the U.S. population is afflicted with the severest forms, with 10 percent to 20 percent more having the mostly harmless “fatty liver.” Biopsy determines which of those is the case, if the patient’s blood test raises suspicion.

More than 10 percent of the U.S. population may have some form of NASH, and the worst-off population could make up 6 million patients, more than the market for chronic hepatitis C virus or alcoholic liver disease.

NASH has “come out of nowhere, seemingly, in the last decade or so to become, frankly, an epidemic,” Pruzanski said. “There’s no other way to describe it.” The condition is projected to become the leading indication for liver transplant. OCA, which is a bile acid analogue and first-in-class agonist of the farnesoid X receptor (FXR), was given daily to biopsy-proven adult NASH patients over a 72-week period in FLINT, from which Intercept had not expected full data until as late as the end of this year.

Osaka, Japan-based Dainippon Sumitomo Pharma Co. Ltd., Intercept’s partner, has a NASH trial with OCA under way. The licensing deal with Dainippon came about in 2011, when Intercept collected $15 million up front, with the promise of as much as $300 more in milestone payments. Dainippon will develop and commercialize the drug in Japan and China, with an initial focus on NASH and primary biliary cirrhosis (PBC), an indication in which OCA is farther advanced. (See BioWorld Today, March 31, 2011.)

Dainippon expects to complete its NASH enrollment by the end of this month, targeting 200 patients, with top-line data expected by the end of 2015. Whether Intercept’s FLINT results plus existing safety data, along with the outcome of the Japan trial, would be enough for an NDA package is unclear, Pruzanski said, and would be hashed out with regulators.

Meanwhile, Intercept’s PBC trial, known as POISE, is moving along briskly. As of late 2013, more than 125 patients had transitioned into the long-term, safety extension part of the Phase III experiment, which enrolled 218 patients in total.

The PBC patient population is estimated at 30,000. If approved in that orphan disease, OCA could command pricing of about $100,000 per year, wrote Janney’s Molloy in a research report, and “once the pricing for an orphan drug has been set, an expanded patient population would not change it.”

OTHER PHASE II TRIALS PROMISING

OCA is also at the Phase II stage in portal hypertension (high blood pressure in the portal vein – actually a vessel – that carries blood from the gastrointestinal tract and spleen to the liver) with alcoholic cirrhosis. In that indication, the study known as PESTO gave forth encouraging interim results at the 2012 American Association for the Study of Liver Diseases meeting, with five of eight evaluable patients hitting the primary endpoint: reduction of hepatic venous pressure gradient after seven days of treatment by 15 percent or more, or to less than 12 mm Hg. Final data likely will include more patients, treated at a higher dose, Molloy wrote.

A Phase II trial is under way, as well, in bile-acid diarrhea (often mistaken for irritable bowel syndrome, and characterized by impaired release of fibroblast growth factor 19, which OCA stimulates). Called OBADIAH, this study has proved strong in early results. The company disclosed in May of last year that OCA reduced stool frequency.

OCA’s medicinal magic lies in its bile-acid mimicry without toxic or inflammatory effects, thus stimulating FXR, which blocks the bad consequences of highly concentrated bile that’s already present.

Needham analyst Alan Carr wrote last November that his firm is “inclined towards a favorable outcome” for both of the Phase II trials, and now that the stellar NASH study results have rolled out ahead of schedule, the likelihood seems even more convincing.

Intercept charged out of the gate in October 2012 with a better-than-expected initial public offering that sold 5 million shares of common stock at $15 per share, with a 30-day option to underwriters to purchase up to 750,000 more. Intercept had filed in September for 4.3 million shares between $13 and $15 per share, for an expected total value of $60 million to $75 million, and ended up collecting at the top of the range. (See BioWorld Today, Oct. 12, 2012.)