With Headway in NASH, Madrigal Pharma is Considering Sale

Sales Projections

Reportedly, Madrigal Pharmaceuticals, based in West Conshohocken, Pennsylvania, is considering a sale. According to a Bloomberg report, after receiving interest from other big drug companies, the nine-employee company is evaluating its options, and is working with Centerview Partners Holdings on exploring a sale.

Madrigal focuses on drugs that target a specific thyroid hormone pathway in the liver, which is a key regulatory mechanism common in numerous diseases, including non-alcoholic steatohepatits (NASH). Its MGL-3196 is in Phase II clinical trials for NASH and familial hypercholesterolemia (FH).

On May 31, the company announced positive top-line, 36-week data from the Phase II trial in NASH. MGL-3196 is a first-in-class, oral, once-daily, liver-directed, thyroid hormone receptor beta-selective agonist. The primary endpoint of the trial was relative reduction of liver fat on MRI-estimated proton density fat fraction (MRI-PDFF) at 12 weeks.

The trial at 36 weeks showed sustained, highly statistically significant reduction in liver fat compared to placebo. The mean relative fat reduction in the patients receiving the drug was 37 percent compared to 8.9 percent on placebo. They also had statistically significant decreases in low-density lipoprotein cholesterol (LDL-C), triglycerides, ApoB and lipoprotein(a). Liver enzymes were also significantly decreased. There were also significant decreases in fibrosis biomarkers compared to those on placebo.

“NASH is a common liver disease in the United States, with a growing prevalence, for which no FDA approved treatment is yet available,” said Stephen Harrison, Principal Investigator of the trial in a statement. Harrison is the medical director of Pinnacle Clinical Research in San Antonio Texas. “Compared with Week 12, at Week 37 MG-3196 showed sustained effects to reduce liver fat on MRI-PDFF, and more reduction in liver enzymes than placebo. MGL-3196 demonstrates improvement relative to placebo on measurements of NASH on liver biopsy, including resolution of NASH. Importantly, this study is the first to demonstrate a correlation between efficacy in a non-invasive imaging test, MRI-PDFF at 12 weeks, and improvement in NASH on liver biopsy at 36 weeks.”

Which goes a long way to explaining why larger companies might be interested in acquiring Madrigal. NASH is a big area of unmet medical need, linked to the obesity and type 2 diabetes epidemics. There are no treatments aside from diet and exercise. NASH is similar to cirrhosis of the liver, but occurs in individuals who drink little or no alcohol.

The company has a market value of approximately $4.3 billion. Bloomberg noted, “The drugmaker’s valuation may deter some potential buyers, the people said, as the stock has surged about 18-fold in the past year with investors growing increasingly optimistic about the prospects for a treatment of the liver disease known as nonalcoholic steatohepatitis, or NASH. The potential for groundbreaking NASH therapies has generated excitement among investors and larger drugmakers, with behemoths like Gilead Sciences, Inc. and Novo Nordisk A/S also pursuing treatments.”

The market for NASH treatments has been projected to hit $25 billion by 2026. A recent analysis by BioPharma Dive indicated there are approximately 195 treatments in the pipeline for NASH. Most are in early- or mid-stage development. Any in late-stage are at least a year away from approval. In addition to Gilead and Novo Nordisk, companies with NASH programs include Terns Pharmaceuticals, which licensed three NASH programs from Eli Lilly, AstraZeneca, and Takeda Pharmaceuticals. Allergan has also acquired several companies in the NASH space.

Earlier this month, Paul Friedman, Madrigal’s chief executive officer, stated, “We have managed the company with an open mind to strategics who would either want to partner or acquire us. There’s a lot of interest in the field, obviously.”

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