The stock of a little-known biotech company, Intercept Pharmaceuticals Inc.,ICPT -29.98% nearly quadrupled Thursday after the company's liver-disease drug performed well in a clinical trial, marking the biggest one-day stock leap among Nasdaq Composite companies of a similar size since at least 2012.
Shares of New York-based Intercept—which has 45 employees and no products on the market—closed Thursday at $275.87 on the Nasdaq Stock Market, valuing the company at $5.3 billion. On Wednesday, the stock closed at $72.39 with a market capitalization of $1.4 billion.
That's the largest one-day jump among Nasdaq Composite companies with market values of over $1 billion since at least 2012, according to FactSet Research Systems Inc. Only three other Nasdaq Composite companies of that size have had one-day stock increases of more than 100% since 2012, FactSet said.
The company, which operates out of offices in Manhattan's Meatpacking District, hasn't turned a profit to date. It was founded in 2002 by an Italian professor and an American venture capitalist and had an initial public offering in 2012.
Its biggest shareholder is Genextra SpA, an Italian life-sciences investment firm co-founded by Francesco Micheli, which owns about 31.5% of the company. Genextra couldn't immediately be reached for comment Thursday.
Intercept's stock leapt Thursday after the company announced that a clinical trial of its experimental drug had been halted early because patients showed significant improvement.
"My reaction is 'Wow,' " Intercept Chief Executive and co-founder Mark Pruzanski said in an interview. "We didn't expect this. The bar for stopping the study for efficacy was so high from a statistical significance standpoint that on an interim analysis like this, it seemed out of sight. We couldn't be happier with the result."
The drug, called obeticholic acid, or OCA, mimics a naturally occurring human bile acid that Intercept believes has liver-protective properties. The National Institute of Diabetes and Digestive and Kidney Diseases sponsored a clinical trial of the drug in patients with a condition known as nonalcoholic steatohepatitis, which involves fat accumulation in the liver that can cause inflammation and lead to the more serious conditions of cirrhosis and liver failure. The disease progresses over many years and often has no symptoms in the early stages.
There are no specific therapies for the disease, which affects 2% to 5% of Americans, according to the National Institutes of Health. Instead, physicians often recommend patients lose weight if they are overweight, improve their diets, exercise, and avoid alcohol and unnecessary medications.
The study compared OCA to a placebo and tracked the effect on liver biopsy samples and other measures of liver health. The trial, which began in 2011, enrolled more than 280 patients and was due to be completed by late 2014. But Intercept said Thursday the trial was stopped after a planned interim analysis showed that OCA induced a "highly statistically significant improvement" in measures of liver health versus placebo.
Dr. Pruzanski said the company doesn't yet have details about any adverse events patients might have experienced during the trial.
The drug was invented by Roberto Pellicciari, a professor at the University of Perugia in Italy and a co-founder of the company. Dr. Pellicciari couldn't be reached for comment Thursday.
Many experimental drugs fail to make it to market, so Intercept's OCA could yet stumble. But the clinical trial outcome raised investors' expectations that the company could have a big-selling product on its hands.
"We anticipate OCA could be a potential blockbuster drug," Janney Capital Markets analyst Jim Molloy wrote in a research note. He previously estimated the drug could generate annual sales of about $2 billion in 2020 if it makes it to market, but said the estimate was under review in light of the new data.
Intercept's development partner on the drug, Dainippon Sumitomo Pharma Co.4506.TO -7.66% , which trades on the Tokyo Stock Exchange, is conducting a similar trial in Japan, with enrollment expected to be completed by the end of January and preliminary results expected by the end of 2015. News of OCA's positive clinical trial results broke after the close of trading on the Tokyo Stock Exchange Thursday.
Intercept also is studying the drug in another liver condition, primary biliary cirrhosis.