CUPERTINO, Calif. - DURECT Corporation (NASDAQ:DRRX), a biopharmaceutical firm focused on epigenetic therapies, has received Breakthrough Therapy designation from the U.S. Food and Drug Administration for larsucosterol, aimed at treating severe alcohol-associated hepatitis (AH), a condition currently without approved treatments. This designation, which seeks to expedite drug development, was supported by results from the Phase 2b AHFIRM trial.
The AHFIRM trial, a rigorous international study, assessed the efficacy and safety of larsucosterol in patients with severe AH. The primary outcome was the 90-day incidence of mortality or liver transplantation in patients treated with larsucosterol versus placebo. Secondary endpoints included 90-day survival rates. The trial enrolled 307 patients across multiple countries, including the U.S., EU, U.K., and Australia.
James E. Brown, D.V.M., President and CEO of DURECT, expressed satisfaction with the FDA's decision, highlighting the urgent need for effective therapies for AH, which has a high mortality rate. The company plans to proceed with a Phase 3 trial, incorporating FDA feedback and data from the AHFIRM trial.
The Breakthrough Therapy designation enables accelerated development and review of drugs for serious or life-threatening conditions when preliminary evidence suggests substantial improvement over existing therapies. Benefits include more frequent FDA interactions, eligibility for rolling review, and guidance from senior FDA managers.
AH is a severe form of liver disease linked to heavy alcohol use, characterized by inflammation and liver cell damage, leading to complications such as liver failure. The mortality rate for AH is significant, with studies indicating a 26% death rate at 28 days and 44% at 180 days post-diagnosis.
Larsucosterol, DURECT's lead candidate, is an epigenetic modulator that targets dysregulated DNA methylation, a common feature in acute and chronic diseases, including AH. By inhibiting DNA methyltransferases, larsucosterol may help reduce inflammation and improve cell survival.
DURECT's commitment to developing therapies for serious health conditions extends beyond AH, with applications in acute organ injury and cancer. The company's portfolio also includes POSIMIR®, a non-opioid analgesic for post-surgical pain, licensed to Innocoll Pharmaceuticals for U.S. distribution.
This news article is based on a press release statement.
InvestingPro Insights
As DURECT Corporation (NASDAQ:DRRX) advances its lead candidate larsucosterol, the company's financial metrics provide a mixed picture. With a market capitalization of $32.28 million, DURECT's valuation reflects the high-risk, high-reward nature of biopharmaceutical development. The company's Price to Book ratio, as of the last twelve months leading up to Q1 2024, stands at 3.89, indicating that investors are willing to pay nearly four times the book value for its shares, which could be seen as a sign of confidence in the company's assets and future prospects.
However, the financial data also reveals challenges. DURECT's significant negative gross profit margin of -272.18% in the same period suggests that the cost of goods sold far exceeds the revenue generated, which is not uncommon in the biopharmaceutical industry where upfront costs are high and revenues are often delayed until regulatory approval and market penetration. Additionally, with analysts not expecting the company to be profitable this year, investors may be focused on the potential future value of breakthrough therapies like larsucosterol rather than immediate financial performance.
On the brighter side, DURECT has experienced a strong return over the last month, with a 19.38% price total return, and an even more impressive six-month price total return of 64.84%, reflecting investor optimism possibly tied to the recent Breakthrough Therapy designation and promising trial results. This optimism is echoed by two analysts who have revised their earnings upwards for the upcoming period, as per InvestingPro Tips.
For those interested in a deeper dive into DURECT's financials and forecasts, InvestingPro offers additional insights. There are 13 more InvestingPro Tips available that could provide valuable information for potential investors. To access these insights and make more informed investment decisions, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at https://www.investing.com/pro/DRRX.
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