Ardelyx Inc. (NASDAQ:ARDX) Drug Thrives In Trials

Ardelyx Inc. (NASDAQ:ARDX)

Shares of Ardelyx Inc. (NASDAQ:ARDX) gained 36.11% in after-hours of trading, after the late-stage company said its experimental drug for irritable bowel syndrome met its primary endpoint. According to the drug developer, Tenapanor met the main goal of reducing abdominal pain and increasing bowel improvements.

IBS-C Treatment Opportunity

The positive clinical trial results could have a significant impact on the stock, especially after the Chief Executive Officer, Mike Raab claimed the results are a game changer for patients with IBS-C. Shares of Ardelyx are in dire need of a catalyst after its price edge lower after coming under pressure in May.  The stock is already down by more than 50% as it continues to trade at multi-year lows.

Ardelyx Inc. (NASDAQ:ARDX)

Investors’ confidence on the stock has taken a hit this year. However, the positive Tenapanor clinical trial results could be the catalyst to renew interest, given that the condition affects more than 11 million people across the United States.

“Based on tenapanor unique mechanism of action, which relies upon the inhibition of sodium absorption, and the exciting data reported today, tenapanor has the potential to be an important advancement and a new treatment option for patients suffering from IBS-C,” said William Chey, M.D., University of Michigan.

The clinical trial results indicate that Tenapanor has significant potential which increases the chances of Ardelyx Inc. (NASDAQ:ARDX) finding the ideal partner to bring it to market. Buoyed by the positive results, Ardelyx plans to submit, in the second half of next year, a New Drug Application (NDA) with the U.S Food and Drug Administration (FDA) for the treatment of IBS-C.

Ardelyx Restructuring

Separately, Ardelyx Inc. (NASDAQ:ARDX) completed a strategic review of its operations in the second quarter as it sought to position itself for multiple opportunities with its late-stage portfolio. The review process has resulted in the prioritization of resources to focus on upcoming milestones for late stage programs.  The company has also reduced its workforce by 28%.

Thanks to cost-saving initiatives, Ardelyx Inc. (NASDAQ:ARDX) remains on track to extend its operating runaway to the end of 2018. During the quarter, the company reported a net loss of (-$25.7) million or (-$0.54) cents a share, compared to a net loss of (-$28.6) million reported a year earlier.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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Ardelyx Inc. (NASDAQ:ARDX) Struggling After Successful Phase 3 Trial Of Tenapanor

Ardelyx Inc. (NASDAQ:ARDX)

Ardelyx Inc. (NASDAQ:ARDX) has lost ground in the market ever since it reported data from its Phase III study for its lead asset tenapanor. The sudden change in investor sentiments comes even though the drug met its primary endpoints and performed well against seven of the eight secondary points in the first stage of the two planned Phase III trials.

Positive Clinical Results

Tenapanor is a drug being developed as a novel treatment for irritable bowel syndrome with constipation or IBS-C. The medical condition has a significant market in the U.S. – over 11 million people suffer from the condition. Yet despite the positive outcomes, the stock has curiously shed 40% in market value.

Ardelyx Inc. (NASDAQ:ARDX)’a drug candidate is designed to stop the body from removing sodium in the gastro-intestinal tract. Increased level of sodium in the gut goes a long way to loosen stool and, therefore, relieving constipation. During the trials, Tenapanor successfully reduced abdominal pain by 30% and also resulted in an increase in spontaneous bowel movements.

“In this trial, tenapanor demonstrated clinical activity across a large number of study parameters and had a favorable safety profile consistent with previous clinical experience. With a differentiated mechanism of action, we believe tenapanor has the potential to augment the care of patients with IBS-C,” said CEO, Mike Raab.

Data from the trials also shows a good number of patients treated with tenapanor hit the primary endpoint compared with those on a placebo – 27% vs. 18.7%.

Tenapanor Prospects

One of the main reasons why investors sent the stock crumbling in the market may have to do the safety and tolerability aspect of the drug. When it comes to tenapanor, just like other drugs used to treat irritable bowel syndrome, diarrhea is always a big concern. The drug will have to find a balance between the medical condition and resolution if it is to combat its largest side-effect – diarrhea.

According to the study, 14.6% of the patients who took tenapanor got diarrhea with 5.9% opting to go off the drug due to this side effect. While the number looks pretty good when compared to Ironwood’s Linzess, the same cannot be said when compared to Synergy Pharmaceuticals Trulance.

The fact that Ardelyx Inc. (NASDAQ:ARDX) is competing with Synergy and Ironwood means it will have to significantly reduce the side effects of its candidate drug if it is to prevent further downturn.

Ardelyx Inc. (NASDAQ:ARDX) was down by 7.07% in Friday’s trading session and ended the week at $4.60 a share.

Ardelyx Inc. (NASDAQ:ARDX)
ARDX Chart

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

About the author: James Marion is a University of Houston student studying Business with a concentration in Finance