Roivant Sciences Ltd. (NASDAQ:ROIV) shares jumped about 17% after the company reported positive mid-stage results for mosliciguat, its experimental treatment for pulmonary hypertension associated with interstitial lung disease (PH-ILD). The readout gives Roivant another late-stage pipeline opportunity shortly after the company won U.S. approval for Lisraya, its treatment for adults with dermatomyositis.
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PH-ILD develops when scarring in the lungs damages blood vessels, increasing pressure and forcing the heart to work harder. Roivant is now moving ahead with a Phase 3 study of mosliciguat, with enrollment already underway.
Bull Case
Mosliciguat met the primary endpoint of Roivant’s 135-patient PHocus study. At Week 16, the treatment produced a 56.3% placebo-adjusted reduction in pulmonary vascular resistance, or PVR, with a p-value below 0.0001. According to Roivant, this represented the largest PVR reduction reported in a randomized controlled pulmonary hypertension trial. The study also met its secondary endpoint for six-minute walk distance. Patients receiving mosliciguat walked 35.2 meters farther than those receiving placebo at Week 16, with a p-value of 0.0027. Roivant also reported a 53.2% placebo-adjusted reduction in NT-proBNP, a biomarker used to assess cardiac strain, with a p-value of 0.0002.
Roivant reported additional results from a pre-specified exploratory analysis at Week 24. The placebo-adjusted difference in six-minute walk distance was 52.7 meters, while the placebo-adjusted reduction in NT-proBNP was 75.9%. These Week 24 findings were exploratory and were reported with nominal p-values. The company also said mosliciguat was well tolerated in the study. Cough was reported in 12.1% of patients receiving mosliciguat compared with 18.2% of those receiving placebo.
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The data have also drawn attention to the drug’s potential commercial opportunity, although estimates at this stage remain forecasts rather than realized sales. J.P. Morgan analyst Brian Cheng told Reuters that before the readout, the firm estimated risk-adjusted peak PH-ILD sales of $1.5 billion for mosliciguat. Cheng said the latest results suggest the drug’s potential could be greater, citing management’s comments about possible development in additional indications. Roivant has already initiated its Phase 3 PHrontier study, and enrollment is underway.
Bear Case
Despite the positive PHocus results, mosliciguat remains an experimental treatment and has now entered Phase 3 development. The results reported so far come from a 135-patient mid-stage study, while the Week 24 findings were exploratory rather than primary or secondary endpoints. Mosliciguat would also enter a PH-ILD treatment landscape that already includes other therapies. Reuters identified United Therapeutics’ Tyvaso and Tyvaso DPI and Liquidia’s Yutrepia among available treatments, and some patients also receive PDE5 inhibitors off-label, including drugs such as Viagra and Cialis.
Investors should also distinguish the clinical results from the commercial projections surrounding the drug. J.P. Morgan’s $1.5 billion risk-adjusted peak-sales estimate is an analyst forecast, not Roivant guidance or current revenue. For now, the clearest development is clinical, as mosliciguat met the primary and secondary endpoints of its Phase 2 study, and Roivant has moved the program into Phase 3. The PHrontier study will provide the next major set of clinical evidence for the program.
Conclusion
For Roivant, this is the kind of clinical result that can make investors look at the pipeline differently. Mosliciguat did what it needed to do in Phase 2, delivering significant results on both the primary endpoint and the six-minute walk test, and the program is already moving through Phase 3. Coming soon after Lisraya’s FDA approval, that gives Roivant another late-stage asset with a clear catalyst ahead.
The $1.5 billion risk-adjusted peak-sales estimate from J.P. Morgan adds to the interest, but it is still just an analyst estimate. What matters now is whether the Phase 2 results hold up in the larger PHrontier study, because if they do, mosliciguat could become a much more important part of the Roivant story. For now, Phase 3 is the milestone investors will be watching.
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This article is originally published at Insider Monkey.
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