Dainippon Sumitomo Surges on Partner Trial for Liver Drug

Jan 10, 2014 7:36 pm ET

Jan. 11 (Bloomberg) -- Dainippon Sumitomo Pharma Co. surged to the highest in more than a decade yesterday after a U.S. partner’s trial of a liver disease drug worked well enough for the testing to be stopped.

Osaka-based Dainippon’s shares surged 17 percent to close at 1,906 yen in Tokyo trading, the highest level since March 2001. The broader Topix index gained 0.1 percent.

Intercept Pharmaceuticals Inc., Dainippon’s New York-based partner, rose 62 percent to close at $445.83 in New York, after more than tripling a day earlier.

Intercept’s obeticholic acid, or OCA, treats nonalcoholic steatohepatitis, or NASH, a liver disease in which people who don’t drink or drink very little alcohol suffer damage that resembles that of heavy drinkers. Eventually, the disease can cause scarring and hurt the organ’s ability to function. About 2 percent to 5 percent of Americans have the disease, according to the National Institutes of Health.

The drug is in the second of three stages of testing typically required before approval. In a trial of 283 patients who got either the drug or placebo, Intercept said the drug was shown to be effective in getting a measurement of the disease to drop by at least two points on an eight-point scale.

Dainippon Sumitomo and Intercept in 2011 announced an agreement to develop and commercialize obeticholic acid for chronic liver disease and Dainippon licensed the drug for sale in Japan and China in March 2011.

--With assistance from Caroline Chen in New York. Editors: Anjali Cordeiro, Bruce Rule