Retrophin, the drug developer founded by controversial former biotech executive Martin Shkreli, has posted positive results from a midstage study for its treatment for a rare kidney disease.
San Diego-based Retrophin said that its drug, sparsentan, outperformed another drug sometimes used to manage a rare kidney disease, called focal segmental glomerulosclerosis (FSGS), in a Phase 2 clinical trial. The kidney disorder doesn’t have any FDA-approved therapies, Retrophin says, but several drugs are currently used off-label to treat it, including steroids, immune system suppressants, and diuretics.
Patients who received sparsentan had a 44.8 percent reduction in a symptom of the disease that’s associated with a breakdown of normal kidney function, according to the initial trial results. Meanwhile, patients who received irbesartan—one of a few different drugs used to manage FSGS—saw the symptom decline by 18.5 percent.
Retrophin (NASDAQ: RTRX) shares rose $4.96 cents by midday Wednesday, up 30.3 percent to $21.25 on the Nasdaq. The company plans to present detailed results at an upcoming medical meeting or in a peer-reviewed journal, it said in a statement.
The results exceeded expectations, according to a note from analysts at Leerink Partners, who said the drug has a 75 percent chance to earn FDA approval. The analysts said they were cautiously optimistic that Retrophin will meet the next milestone: earning an accelerated approval process from the FDA for the drug. Leerink expects the company to meet with the FDA later this year.
Retrophin’s involvement with sparsentan began with Shkreli, the company’s former CEO, who has since been characterized as an archetype of pharmaceutical industry greed rather than innovation. He licensed the drug from San Diego-based Ligand Pharmaceuticals (NASDAQ: LGND) in March 2012. Months later, Shkreli raised a $4 million Series A round for Retrophin from the hedge fund that he also ran, MSMB Capital.
After in-licensing and developing multiple other compounds and taking the company public through a reverse merger, Shkreli was ousted from Retrophin in late 2014—shortly after he raised the price on an old drug used for treating a condition related to kidney stones, which the company acquired, from $1.50 to $30 apiece. That would prove to be a harbinger of things to come.
After leaving Retrophin, Shkreli founded a new biotech, Turing Pharmaceuticals where he doubled down: He raised the price of another drug, Daraprim, used to treat parasitic infections that often afflict people with HIV. This time, he increased the price from $13.50 to $750 a pill. To say the least, there was widespread public outrage. While the incident undoubtedly made him famous, it also turned him into a global punching bag for price gouging. To boot, he was pushed out of Turing, indicted on fraud charges, and sued by Retrophin.
Even so, acquisitions that Shkreli made in Retrophin’s early days, such as sparsentan, can be partly credited for making Retrophin a potential success. The Leerink analysts placed a $32 per share price target on the stock.
FSGS affects an estimated 40,000 patients in the U.S. and can lead to end-stage renal disease after progressive scarring of the kidney, according to Retrophin. The Phase 2 trial studied sparsentan’s ability to reduce a measurement of a protein in a patient’s urine, known as proteinuria. The symptom is caused by a breakdown of the kidney’s normal filtration mechanism. Reducing levels of proteinuria is associated with a lower risk of FSGS, Retrophin says.
Other symptoms include edema, high cholesterol, and high blood pressure, according to nonprofit NephCure Kidney International.