An unusual placebo effect in Aligos Therapeutics’ Phase IIa trial is driving shareholder skepticism for its metabolic dysfunction-associated steatohepatitis candidate, according to Jefferies analyst Michael Yee.
Aligos Therapeutics on Thursday posted topline data from the Phase IIa HERALD study in metabolic dysfunction-associated steatohepatitis, showing that its drug candidate ALG-055009 significantly reduced liver fat.
At 12 weeks, patients who were treated with 0.5-mg, 0.7-mg and 0.9-mg doses of ALG-055009 had significantly lower liver fat, with median placebo-adjusted relative reductions of 24.1%, 46.2% and 43.6%, respectively. The lowest dose group, treated with 0.3-mg ALG-055009, saw a 19.7% decrease in liver fat, which failed to reach statistical significance.
In addition, up to 70% of participants achieved at least 30% relative reduction in liver fat from baseline, according to Aligos.
CEO Lawrence Blatt in a statement said that these findings highlight ALG-055009’s “enhanced pharmacologic properties,” which translated “into robust improvements in lifer fat reduction.” The drug candidate was also well-tolerated in HERALD, with no serious adverse events or episodes of clinical hyper- or hypothyroidism. Most treatment-emergent toxicities were mild to moderate.
Blatt made the case that ALG-055009’s favorable safety profile is “important” especially since treatments for metabolic dysfunction-associated steatohepatitis “will likely be administered for prolonged periods of time.”
With these data from HERALD, Aligos contends that ALG-055009 “warrants further development” and the company is holding “early discussions” with potential partners and is exploring other options to fund the candidate’s development, Blatt said. Aligos expects to complete required activities for a Phase IIb study by mid-2025.
However, despite HERALD’s positive results and ALG-055009’s promising path forward, the company’s stock tanked as much as 30% on Thursday.
Jefferies analyst Michael Yee in a note said that shareholder skepticism can be chalked up to some confounding data. HERALD’s placebo arm was “different than other studies” and the study sample had slightly higher background GLP-1 use, making quick cross-trial comparisons “difficult,” according to Yee.
Digging into Aligos’ data, Yee pointed out that its placebo-adjusted efficacy estimate of up to 46% should be viewed in light of the fact that placebo patients in HERALD saw a 7% rise in liver fat over the study’s duration. This trend is in contrast with other studies in which placebo participants tend to lose liver fat over time, “which makes sense,” Yee noted, as patients may adjust their diet during the trial.
The result of this placebo effect is that it makes ALG-055009’s placebo-adjusted effect “look better,” Yee wrote. “On an absolute basis and excluding placebo,” ALG-055009’s effects may in actuality be more in line with other MASH therapies, he argued.
