What’s Next For Esperion Therapeutics Inc (ESPR)?

Esperion Therapeutics Inc (NASDAQ:ESPR) picked up strength at the end of last week, on the back of some news that – at first glance – seems unrelated to its own operations. Look a little deeper, however, and the gains seems to be justified, with an implications-based link between the aforementioned released news and Esperion’s pipeline. The question now, is, what’s next? Will the company continue to run, or is this response a one-off move? Let’s take a look.

So, the news in question relates to a drug currently under investigation by big pharma giant Amgen, Inc. (NASDAQ:AMGN). The drug is called Repatha, and it is part of a family of drugs called PCSK9 inhibitors. Some reading may already be familiar with this type of drug. For the last three or four years, PCKS9 inhibitors have been something of a hot topic in the cholesterol-lowering and cardiovascular space. A number of companies are developing them, and some are pretty close to bringing their respective assets to market.

As the name suggests, the drugs work by inhibiting a protein called PCKS9, which – when active – bind to what are called low-density lipoprotein receptors (LDL receptors). When bound, LDL receptors stop LDL from being removed from the blood, and this results in raised cholesterol. The current standard of care for reducing cholesterol is statins, but a large number of people are intolerant to statins, and there are some associated side effects that make them undesirable in certain patients. The idea is that these sorts of inhibitors can become a viable alternative to statins in these latter patients.

Esperion Therapeutics Inc (NASDAQ:ESPR)’s drug is not a PCSK9 inhibitor. It is called bempedoic acid, or ETC-1002, and it inhibits something called ATP citrate lyase. In this sense, its MOA is similar to that of the PCSK9 inhibitors class, and herein lies the link.

Basically, there is some uncertainty over the willingness of the FDA to approve Esperion’s ETC-1002 without the company conducting studies (and in turn, putting forward data) that proves a link between reduced cholesterol and a concurrent reduction in cardiovascular events. If the company has to conduct these tests, there is an obvious cost associated with doing so, and at this end of the biotechnology space, these costs can be prohibitive to investors pulling the trigger on a speculative buy position.

The data that Amgen, Inc. (NASDAQ:AMGN) just put out relates to its own candidate, Repatha, as evaluating whether Repatha reduces the risk of cardiovascular events in patients with cardiovascular disease. Well, we say data, but really the company just released a conclusion. That conclusion, however, was enough to give some of those as yet undecided potential Esperion buyers to pull the just mentioned trigger. Why? Because the conclusion released by Amgen was that its drug significantly reduces the risk of cardiovascular events.

The importance of this conclusion is that – while the two companies’ drugs are not the same chemically – they both work towards the same endpoint (reduction of LDL). As such, with Amgen demonstrating that a reduction in LDL levels translates to a concurrent reduction in cardiovascular risk, markets are taking a position based on the implications of this conclusion for ETC-1002; specifically, that the FDA will be lenient on the company and approve the drug based on the surrogate suggestion of endpoint efficacy.

So, that is the news, and why the company has gained strength. As of last count, the end of last week, Esperion Therapeutics Inc (NASDAQ:ESPR) was up nearly 30% and currently trades just shy of its 52-week highs. The question now, is, as mentioned, will this run continue? Our answer: we expect that – near term, at least – this is the peak of the Amgen, Inc. (NASDAQ:AMGN) news-driven run. With that said, however, there are a number of catalysts set to hit press over the next couple of quarters, and each has the potential to inject some further upside momentum into the company if they hit press as favorable.

Specifically, we should have some news from Esperion as related to its phase 3 development of 1002, and also some clarification as to the actual numbers achieved by Amgen and its Repatha in the above discussed study. Both are key drivers to watch going forward, and both could dictate a medium to long-term bias in the companies in question. We will update as and when we hear more.

Note: This article is written by Mark Collins and originally published at Market Exclusive.