Viridian sinks as eye disease drug disappoints on efficacy despite trial success

By Siddhi Mahatole

March 30 (Reuters) - Viridian Therapeutics VRDN.O shares slumped 34% to an eight-month low on Monday after its experimental treatment for thyroid eye disease lagged rivals in efficacy in a late-stage study, even as it met the main goal of reducing eye bulging.

The 36% and 45% improvements in eye bulging versus placebo fell short of the 50%-plus investors expected, and the double-vision data were harder to read, Jefferies analyst Faisal Khurshid said.

There could be "fierce investor debate on commercial feasibility" of the drug, elegrobart, he said, despite the data reducing risk for Viridian since it now has two potential thyroid eye disease drugs.

Viridian's shares are last down 32% at $18.66. They had gained more than 62% this year, through Friday close.

The study tested elegrobart in 132 patients on either a four-week or eight-week dosing schedule or a placebo.

Thyroid eye disease, or TED, is an autoimmune condition causing inflammation, swelling, and fat expansion behind the eyes, often resulting in bulging, pain, redness, and double vision.

At 24 weeks, 54% of patients in the four-week group showed an improvement in eye bulging, compared with 18% on placebo. Double vision improved in 71% of patients on the more frequent regimen versus 32% on placebo.

The eight-week regimen also beat placebo, with 63% of patients showing reduced eye bulging and 54% reporting improved double vision, compared with 18% and 32% on placebo, respectively.

Oppenheimer analyst Leland Gershell said the less frequent dosing delivered a better profile of the two, but the overall efficacy was "underwhelming."

Viridian expects to submit a U.S. marketing application in the first quarter of 2027.

CEO Steve Mahoney said a home-administered IGF-1R therapy could help expand the thyroid eye disease market and allow Viridian to gain share. He said the company has "a lot of optionality" on pricing across both dosing schedules.

The only approved therapy for the condition, Amgen's AMGN.O Tepezza, was approved by U.S. regulators in 2020.