The Zacks Analyst Blog Highlights:Intercept Pharmaceuticals, AT&T, Verizon Communications, Sprint and T-Mobile US
CHICAGO, Jan. 13, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Intercept Pharmaceuticals (Nasdaq:ICPT-Free Report), AT&T, Inc. (NYSE:T-Free Report), Verizon Communications Inc. (NYSE:VZ-Free Report), Sprint Corporation (NYSE:S-Free Report) and T-Mobile US, Inc. (NYSE:TMUS-Free Report).
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Here are highlights from Friday's Analyst Blog:
Intercept Pharma Surges on Trial Results
Shares of Intercept Pharmaceuticals (Nasdaq:ICPT-Free Report) surged a whopping 281.09% in regular trading after the company announced that the FLINT (Farnesoid X Receptor Ligand Obeticholic Acid in Nonalcoholic Steatohepatitis Treatment) trial on its lead pipeline candidate, obeticholic acid or OCA was stopped early after the study met its primary endpoint.
The multi-center, double-blind, placebo-controlled phase II trial, FLINT (n=283), is evaluating the efficacy and safety of OCA for the treatment of nonalcoholic steatohepatitis (NASH).
The trial is being sponsored and conducted by the National Institute of Diabetes & Digestive & Kidney Diseases (NIDDK).
The Data Safety Monitoring Board (DSMB) reviewed liver biopsy data through the trial in approximately half of the randomized patients and recommended to stop the trial. The data from the trial showed that treatment with OCA resulted in a highly statistically significant improvement as compared to placebo, thereby meeting the primary endpoint.
The news comes as a major milestone for Intercept Pharma as OCA is its lead candidate. Intercept Pharma primarily focuses on the development and commercialization of novel therapeutics to treat chronic liver diseases.
Apart from NASH, OCA is being evaluated for other indications like primary biliary cirrhosis (PBC), portal hypertension and bile acid diarrhea (BAD).
We note that OCA enjoys orphan drug status in the U.S. and EU for the treatment of PBC. Intercept owns worldwide rights to OCA except in Japan and China, where it has out-licensed the product candidate to Dainippon Sumitomo Pharma.
Concurrent with the results from the FLINT trial, Intercept Pharma announced that it has obtained positive clinical data in all six phase II clinical trials in five different indications for OCA. The company expects data from POISE and FLINT trials in 2014, followed by the anticipated completion of the New Drug Application (NDA) and Marketing Authorisation Application (MAA) filings for PBC by 2014 end.
Intercept Pharma also announced positive top-line results from the OBADIAH study which is evaluating whether OCA can stimulate the release of FGF19 in patients suffering from primary BAD (PBAD) and preliminary data from the PESTO trial evaluating OCA for portal hypertension.
Intercept Pharma currently does not have any approved drug in its kitty. Hence, we expect investor focus on OCA updates for the PBC (POISE trial) and NASH (FLINT trial) indications.
AT&T Special Access Rates Suspended
The Federal Communications Commission (FCC) recently decided to suspend revision of tariff on time-division multiplex (TDM) based special access services by AT&T, Inc. (NYSE:T-Free Report). According to reports, FCC has suspended certain tariff revisions for five months and has called for an investigation before the increased rates on special access services come into effect.
Special access tariffs are charges on Internet bandwidth, or in other words charges on dedicated wireline circuits, typically owned by large telecom carriers like AT&T and Verizon Communications Inc. (NYSE:VZ-Free Report). These services are sold to competitive carriers like Sprint Corporation (NYSE:S-Free Report) and T-Mobile US, Inc. (NYSE:TMUS-Free Report).
Any increase in these tariffs would directly affect the customers of these competitive carriers who pay the special access charges in lieu of dedicated wireline circuits for Internet services. Since FCC intervention has debarred AT&T to pursue any price hike in this service category, we believe this may likely hurt the company's operating profits going forward.
Further, the company's wireline division is struggling with persistent losses in access lines because of competitive pressure from voice-over-Internet protocol (VoIP) service providers and aggressive triple-play (voice, data, video) offerings by the cable companies. These are weighing on the company's revenues and margins. As a result, any further regulatory intervention can worsen situation for the company, in particular for its wireline business.
In addition, the new spectrum auction by FCC will likely be available over next year. If AT&T fails to acquire substantial bands of spectrum under the auction, the company's business prospects could be hurt.
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