Oramed Pharmaceuticals Inc. (ORMP), the Israeli drugmaker seeking to develop the first oral insulin pill, said a trial on type 2 diabetes patients showed that the medicine has promising therapeutic potential.
The one-week study of 30 patients also met safety goals, the Jerusalem-based company said in a statement today. The company released no data from the study, and said it expects to present full results at a scientific conference. Oramed plans to follow the mid-stage trial with another this year as it pursues a product that, if approved, would provide relief for millions of people taking daily insulin shots.
“The results we announced today give us confidence about the chances of success in a bigger trial going forward,” Chief Executive Officer Nadav Kidron said at a press conference today at the Tel Aviv Stock Exchange. “We are also excited about the potential of this drug for type 1 diabetes.”
The results could bring Oramed, whose stock has more than tripled in the past year, a step closer to doing something no company has ever done: develop oral insulin. The technology has eluded scientists for decades and Novo Nordisk A/S, a Danish developer of diabetes products valued at about $104 billion, has yet to develop a pill to replace daily shots.
Oramed fell 4 percent to $24.94 at the close in New York, giving the company a market value of $243 million. The stock dropped as much as 14 percent, the biggest intraday decline since Jan. 15.
“The stock had made a very big move in a really short time with very little data being shared, so perhaps investors are now thinking that the stock is fully valued,” said Graig Suvannavejh, an analyst at MLV & Co. who has a buy rating and $27 price estimate on the stock. “This is an early-stage company with a very interesting technology. The data is intriguing, but now they need to demonstrate that it works in larger trials.”
While Oramed is years away from a potential approval, it’s taking advantage of the growing attention to raise money. The company raised $16 million on Dec. 25, five days after it said it had successful results in an early-stage type 1 diabetes study. On Jan. 24, the company filed to raise as much as $100 million.
The market for drugs to treat diabetes is likely to grow to more than $58 billion in 2018 from $35 billion in 2012, Standard & Poor’s wrote in an October report.
Diabetes afflicted 371 million people and killed 4.8 million worldwide in 2012, according to the International Diabetes Federation. People with type 2 diabetes don’t produce enough insulin, a hormone that helps the body use or store blood sugar, or can’t use the insulin properly. The illness, the most common form of diabetes, often strikes people over the age of 40, and is tied to obesity and sedentary lifestyles.
The drugmaker’s Protein Oral Delivery, or POD, technology, is based on research by scientists at Jerusalem’s Hadassah Medical Center. The Phase IIa trial detailed today will be followed by a Phase IIb study.
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