Roth Capital Partners downgraded Gemphire Therapeutics (NASDAQ:GEMP) to “neutral” from “buy” with a $2 price target after the company terminated its Phase 2a pediatric non-alcoholic fatty liver disease (NAFLD) trial. The stock closed at $1.80 on August 10.
“The Data Safety Monitoring Board recommended the termination of the trial, due to unforeseen increases in serum alanine transaminase and liver fat content in all of the first three patients (total enrollment was 40 patients) who completed the 12-week treatment”, writes analyst Yasmeen Rahimi.
It appears that the investigators terminated the trial due to the unforeseen increase in liver fat, which unexpectedly suggested “worsening of disease that the investigator believed was likely due to the study drug,” she added.
“While we acknowledge the pediatric and adult populations are different, in our view, this raises questions on gemcabene’s efficacy in the liver,” Ms. Rahimi said.
