FDA Approves Phase 3 Trial for Durect’s Larsucosterol

In a significant development for Durect Corporation (NASDAQ: DRRX), the U.S. Food and Drug Administration (FDA) has approved the company’s plan for a pivotal Phase 3 trial to test larsucosterol, a promising treatment for severe alcohol-associated hepatitis (AH). This approval promises to streamline the drug's development pathway, potentially speeding up its availability to patients in need.

Durect's planned study will enroll 200 patients across the United States to evaluate the efficacy of larsucosterol, with a primary focus on 90-day mortality rates. This design follows notable findings from the Phase 2 AHFIRM study, during which the treatment demonstrated a remarkable 60% reduction in mortality among U.S. participants. This group made up 76% of the trial's enrolment, highlighting substantial national interest and the potential impact of larsucosterol.

Following the announcement, Northland has reiterated its positive outlook on Durect, underscoring that the Phase 3 trial set-up “uniquely derisks larsucosterol's development.”

The financial firm maintains an Outperform rating on Durect shares, with a target price of $8.50. This endorsement from a major analytical firm might influence the market's perception and investor sentiment towards Durect’s stock, as developments in pharmaceutical companies often do following significant regulatory milestones or promising trial results.