Gelesis has rounded up $30 million to take its mixed set of data on its weight loss therapy to regulators in the US and Europe.
The biotech, part of the PureTech group in Boston, did what it could last fall to whip up excitement for hitting one primary measure for efficacy — with 58% of the treatment arm losing at least 5% of their body weight during a study compared to 42% in the placebo group. But it also conceded that the study failed to demonstrate a 3% mean difference between the two, missing the co-primary.
Typically, failing an essential agency standard for an approval would douse expectations about the future, but Gelesis’ unimpressive outcomes were based on a study with a nonsignificant risk (NSR) device designation — underscoring that regulators don’t see much risk in taking the product, which swells up in the stomach to produce a sensation of being full. Absence of risk will be key if this treatment expects to pass muster with regulators.
Jefferies’ Peter Welford has been offering some support for Gelesis’ chances, noting that Invesco put up about $18 million for preferred stock, with PureTech in for $5 million to maintain their 20% ownership stake.
Failing to meet both co-primary endpoints is not “best” case, in our view, but given nearly 60% of adults achieved clinically meaningful 5+% weight loss and the clean safety profile, plus prior FLOW trial data, we are optimistic regulatory authorities should support filings.
If they do green-light the product, the analyst expects the product has peak sales potential of $500 million a year. And he offered an explanation for the co-primary flop, noting that the placebo group had to drink two glasses of water before eating, which may have swelled the placebo effect.
Of course, drinking more water every day is also a standard suggestion for losing weight — and costs a lot less than any therapy.
We have yet to see the full set of secondary data that was also tracked in the study. Gelesis is run by Yishai Zohar, the husband of PureTech chief Daphne Zohar.
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