Shares of Achillion Pharmaceuticals Inc. surged Wednesday after the company said its hepatitis C drug candidate showed positive "proof-of-concept" results, while meeting safety and tolerability goals in an early-stage study.
The stock gained $1.12, or 52 percent, to $3.27 in afternoon trading. Shares reached $3.89 earlier, their highest point in more than a year.
The New Haven, Conn.-based company said late Tuesday that preliminary results show ACH-1625 continues meeting the safety and tolerability goals. Meanwhile, it reduced levels of the virus in patients taking the five-day course, showing "proof-of-concept," or the possibility of effectiveness .
Early-stage studies mainly focus on safety and tolerability, as they are often too small to determine a drug's effectiveness. But "proof-of-concept" is often used by companies to determine whether the drug candidate should be advanced into more detailed and expensive stages of development.
Hepatitis C is a viral infection causing swelling of the liver and can lead to scarring and potential liver failure.
Enrollment in the study is still ongoing and is expected to reach 54 patients.
Achillion said it expects to share additional data on the study in early January, with full data set for a presentation in April at the European Association for the Study of Liver Disease meeting in Vienna.
JMP Securities analyst Liisa A. Bayko reaffirmed a "Market Perform" rating on the stock, saying the early-stage data show the drug candidate as a potential contender in the hepatitis C treatment field.
"Although we are pleased with the results, we remind investors that these data are early and that the hepatitis C protease inhibitor space is highly competitive with many drugs in development," Bayko said.
Vertex Pharmaceuticals Inc. is nearly done with late-stage development of its potential hepatitis C drug, telaprevir. The company has said it plans to ask for Food and Drug Administration approval in late 2010. Pharmasset Inc., with partner Roche, is developing RG7128 as a potential hepatitis C treatment.
Elsewhere, InterMune Inc. and Roche are working on ITMN-191 as a potential contender, though the companies recently cut a high dose of the drug from a study because of its potential to cause liver damage.