Shares of Viridian Therapeutics (NASDAQ:VRDN) fell more than 30% Monday morning following the release of topline results from the company’s REVEAL-1 trial in active thyroid eye disease (TED).
The study, which tested the subcutaneous formulation of elegrobart, met its primary endpoint, signaling that the drug could gain approval. However, efficacy fell short of investor expectations, fueling debate over its commercial potential.
According to Jefferies, the pbo-adjusted proptosis response was 36% for the Q4W dosing schedule and 45% for Q8W, below expectations of more than 50% and trailing performance seen with intravenous competitors such as veli (65%) and Tepezza (51%-73%). Complete diplopia resolution was also mixed, with Q4W at 35% and Q8W at 12%, compared with 42% for IV veli and 28% for Tepezza.
“Elegrobart appears to be a real drug that could expand the TED market with subcutaneous dosing, particularly for infusion-averse patients,” Jefferies wrote. “But debate is likely on how it fits commercially given weaker efficacy.”
On safety, the subcutaneous formulation was generally well-tolerated. Pbo-adjusted hearing impairment was 2% for Q8W and 11% for Q4W, comparable to Tepezza.
Jefferies noted that while the data de-risk the pipeline with REVEAL-2 in chronic TED now partially de-risked, the commercial outlook is less clear. Chronic TED, representing over 70% of patients, could be a major opportunity if the convenience of subcutaneous dosing offsets lower efficacy.
The brokerage maintained a Buy rating on the stock, with a target price of $45, highlighting the potential for Viridian to expand the TED market and capture sales alongside existing intravenous therapies.