Shares in Galectin Therapeutics Inc (NASDAQ:GALT) continued to rule weak in the wake of the company’s announcement that a Phase 2a study called NASH-FX involving its GR-MD-02 therapy failed its primary and secondary endpoints.
The stock ended Thursday at $1.22, down 12.86%, on volume of 2.5 5 million shares.
On Wednesday the company lost nearly half its market value on the news of the failed test. It is a leading developer of therapeutics that target galectin proteins for the treatment of fibrosis and cancer.
Galectin Therapeutics Inc (NASDAQ:GALT) downgraded by analysts
Sa’ar Yaniv of Roth Capital Partners downgraded the stock from Buy to Sell, and pruned the price target from $3 to $0.75.
“In our opinion, the results in fibrosis reflect on GR-MD-02’s efficacy, imparting a black mark on our confidence of a successful clinical program for GR-MD-02 in NASH cirrhosis,” Yaniv said.
Analysts at HC Wainwright also cut their rating from Buy to Neutral, with a price target of $1.50.
However, principal investigator Steven Harrison MD said: “Although there was no apparent improvement in the three non-invasive tests for assessment of liver fibrosis in this four-month pilot trial, inhibition of galectin-3 with GR-MD-02 remains promising for treatment of NASH fibrosis.”
The company intends to conduct yet another clinical trial of GR-MD-02 in the near future. The trial is expected to complete by end-2017.
Galectin Therapeutics Inc (NASDAQ:GALT) earnings
Last month, Galectin reported Q2 EPS of $-0.20 which beat estimates by $0.04.
Galectin held $18 million of non-restricted cash and cash equivalents, and in its opinion that would be sufficient to fund operations and R&D activities up to mid-2017.
That’s not very encouraging.
The news of the trial may also cool interest from any prospective acquirers looking for takeover targets engaged in developing therapies for non-alcoholic steatohepatitis (NASH) and other liver diseases in the wake of Allergan plc’s AGN recent, richly priced deal to acquire Tobira Therapeutics, Inc.