A readout from the first late-stage clinical trial intended to treat the fatty liver disease known as NASH has delivered disappointing results.

Gilead Sciences said Monday that its experimental drug, called selonsertib, failed to improve liver scarring compared to a placebo in a Phase 3 clinical trial. The study enrolled nearly 900 patients with compensated cirrhosis, an advanced form of NASH at higher risk for liver-related death.

Shares of Gilead fell 4 percent on Monday night following the disclosure of the results. The setback is particularly discouraging because Gilead has invested heavily in a pipeline of NASH drugs, hoping clinical success will translate into new revenue and earnings growth.


A second Phase 3 study of selonsertib targeting patients with less advanced NASH is underway, with results expected later this year. Gilead is also conducting mid-stage studies in which combinations of NASH drugs are being investigated.

But Monday’s negative selonsertib study readout will likely cause most investors to zero out the drug in their Gilead models, and that just ups the pressure on incoming CEO Daniel O’Day to find news ways to get the struggling large-cap biotech growing again.

NASH is the commonly used acronym for nonalcoholic steatohepatitis, a chronic disease in which fat accumulates in the liver. Left unchecked over decades, the buildup of fat causes liver inflammation and fibrosis. Patients in the advanced stages of NASH present with cirrhosis and may require a liver transplant in order to survive.

Diet and exercise are effective in reversing the early stages of fatty liver disease, but obesity rates in the U.S. are on the rise, and so is the prevalence of NASH. Depending on how the disease is characterized, an estimated 15 million to 30 million Americans have NASH, according to the American Liver Foundation.

Later this quarter, Intercept Pharmaceuticals is expected to announced results from its own Phase 3 NASH drug trial.

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