NASDAQ-listed Galectin Therapeutics Inc. (GALT) announced top-line data from its phase 2a clinical trial intended to evaluate the efficacy, safety, and tolerability of its key drug GR-MD-02 in nonalcoholic steatohepatitis (NASH) patients with advanced fibrosis (NASH-FX). NASH is a liver inflammation and damage caused by a buildup of fat in the liver of individuals who don’t consume alcohol. Fibrosis indicates the thickening and scarring of connective tissue around the affected organ.

Missed Goal

The smaller four-month long phase 2a trial involved a small set of 30 NASH patients with advanced fibrosis at a single site, and the results missed the primary goal and a few secondary endpoints.

The company argues that “the relatively short treatment duration of only four months assessed in the NASH-FX was inadequate to see an efficacy response,” and is hopeful for additional positive results from the larger in-progress phase 2b clinical trial.

Wider Concerns

However, the results led to wider concerns that the drug may not demonstrate adequate performance during the ongoing phase 2b clinical trial, though those results are expected by late 2017 allowing longer treatment duration. The patient base will also be larger.

The Georgia-based company was successful in recently raising $1.5 million funding. The funds will be used to complete the phase 2b trial.

Compared to previous day’s closing price of $2.47, the stock touched an intraday low of $1.13, a nearly 55% decline, before recovering partially to close at $1.4. (For more, see Will This Drug Beat Gilead to Market in NASH?)