Insmed (INSM) Soars On Top-Line Data For Its Rare Lung Disease Drug

Insmed Inc (NASDAQ:INSM) is skyrocketing today, currently up $13.18 and trading at $25.47 – a 107 percent boost. The sudden surge arrived on the heels of the announcement that a Phase 3 clinical trial evaluating its rare lung disease treatment, ALIS, has hit its primary endpoint.

The drug maker’s stock is also trading on heightened volume today, with more than 14.6 million shares already exchanged so far. On a typical trading day, only about 477,000 shares of Insmed change hands.

ALIS was developed by Insmed as a therapy for treatment-refractory nontuberculous mycobacterial (NTM) lung disease caused by mycobacterium avium complex (MAC) – a highly rare and serious condition. The disease causes symptoms like fever, cough, weight loss, night sweats, lack of appetite, fatigue, and blood in the sputum, and frequently means that patients need to endure long hospital stays.

On top of that, currently available treatments for NTM lung disease fail often. The condition is growing in prevalence, especially in the United States, and Insmed says that it is an emerging public health concern across the globe.

ALIS has already been named a Breakthrough Therapy by the US Food and Drug Administration, and was also given fast track status by the regulatory boyd. Insmed says that it intends on pursuing accelerated approval for the drug.

The product is inhaled once per day, and it is a formulation of an intravenously-administered antibiotic that has been known to be quite toxic to patients’ hearing, kidney function and balance. ALIS brings the antibiotic straight into patients’ lungs – reducing toxicity and prolonging the release of the antibiotic.

The clinical trial reported on today is called the “Convert” study, a global program that evaluated the drug’s safety and efficacy in 18 different countries. The program enrolled 336 patients diagnosed with NTM lung disease caused by MAC. The primary endpoint of the trial is the proportion of subjects who reached culture conversion after six months on ALIS in combination with guideline-based therapy (GBT) – compared to a cohort of patients who were treated with GBT alone.

According to Insmed, ALIS managed to eliminate evidence of the disease by the sixth month in 29 percent of test subjects, compared to just 9 percent in the GBT-only patient group.

“We are particularly encouraged by the consistency of these data when compared with our Phase 2 study results, and look forward to additional data as the CONVERT study continues over the next two years,” said Insmed’s President and Chief Executive Officer, Will Lewis.

Following the upbeat top-line data being released this morning, Evercore ISI announced that it was lifting its price target on Insmed’s stock from $28.00 to $40.00. The firm reiterated an Outperform rating.

Similarly, Baird’s Neena M. Bitritto-Garg told investors earlier today that she was maintaining an Outperform rating on the company’s stock – and boosted her price target from $23.00 to $32.00.

“Though results on the secondary endpoints were not as positive, we think 20% conversion differential plus the strong safety profile provide a clear road towards approval in severe refractory NTM-MAC, and expect these results to appease the majority of investors’ concerns,” the analyst said this morning.

The author of this article holds no position in any of the companies mentioned above.

Tim is a contributing analyst for and specializes in equities trading and public offerings. He is a graduate of UCLA and began his career doing capital markets research for a top investment banking software provider.