Microcap biotech Ocera craters on a PhIIb failure for hepatic encephalopathy

Linda Grais, Ocera

Ocera $OCRX has joined the growing lineup of microcap biotechs to experience the crushing effect of a clinical setback. The biotech announced that its lead, and only, drug — ornithine phenylacetate (OCR-002) — failed a Phase IIb trial among hospitalized patients suffering from hepatic encephalopathy.

There was a 17-hour reduction in time to an improvement in HE symptoms, compared to the placebo arm. But that was not statistically significant and underwhelmed the analysts following this company.

Ocera did what it could to whip up some enthusiasm for the data. Investigators cited a hit on a prespecified exploratory endpoint for time to achieve normal plasma ammonia levels. But investors only saw red, driving down Ocera’s shares by 56% — into penny stock terrain.

Thinly financed biotech companies with small pipelines can gain big when the data turns positive. But failure has been punished harshly.

“This is a key milestone for Ocera: the results confirmed that OCR-002 rapidly and safely lowered ammonia and showed a dose-related clinical benefit,” said Linda Grais, CEO of Ocera. “The patients at the higher doses (15 and 20 grams) had faster clinical improvement and greater complete response rates compared to the patients on the lowest dose (10 grams) and those on placebo. These findings will be integral in determining dose levels for future studies.”

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