Madrigal (MDGL) is a late stage biopharma company developing resmetirom, a first-in-class, orally administered, small-molecule, liver-directed, thyroid hormone receptor (NYSE:THR)-β selective agonist. The drug targets a specific thyroid hormone receptor pathway in the liver, which is a “key regulatory mechanism common to a spectrum of cardio-metabolic and fatty liver diseases with high unmet medical need.” The asset is currently in two Phase 3 clinical studies, MAESTRO-NASH and MAESTRO-NAGLD-1, designed to demonstrate multiple benefits across a broad spectrum of NASH (non-alcoholic steatohepatitis) and NAFLD (non-alcoholic fatty liver disease) patients. I have covered Madrigal extensively before.

Madrigal’s main catalyst is the set of two MAESTRO phase 3 trials, one each in NASH and NAFLD. The MAESTRO-NAFLD study, which is a “relatively lighter weight” study of “presumed NASH” patients in what has been termed by the company as a “real life” NASH study with non-invasive monitoring of patient response, differs from the MAESTRO-NASH study in its selection of patients (less severe NASH, borderline NASH F1-F2 stages), study endpoints, and patient monitoring (biopsy vs non-biopsy). The two studies are best described in the following diagram:


The NAFLD study will be completed by December 2021, while the NASH study by March 2024, with estimated primary completion date of December 2021. The NASH study began in March 2019, while the NAFLD study in December 2019. The NASH study, of course, targets more a severe disease form and therefore will be a crowning success for MGL-3196 or resmetirom, however the NAFLD study is no pushover either and targets a much higher earlier stage patient population.

In the recent AASLD 2020 Virtual Meeting held in November, Madrigal published a number of updates from these studies. The updates included recapitulation of Phase 2 NASH data, but the most important update was early data from the NAFLD part of the MAESTRO study, specifically its OLE arm, and the entire study achieved its enrollment target of over 700 patients in September 2020. That means Madrigal is well on its way to complete the entire study by the target date, or even 2 months earlier than that. MAESTRO-NAFLD-1 was originally planned to enroll 700 patients with non-alcoholic fatty liver disease (NAFLD), presumed NASH, randomized 1:1:1 to receive resmetirom 80 mg once a day, 100 mg once a day, or placebo, and included an 100 mg resmetirom open label arm in up to 100 patients. By September, enrollment exceeded the targets in the three double-blinded arms and in the open label arm. Dr. Stephen Harrison, M.D., Medical Director for Pinnacle Clinical Research, San Antonio, Texas, and Visiting Professor of Hepatology, Oxford University, and Principal Investigator of the MAESTRO studies said, “… The ultimate goals of the biomarker tests and liver imaging, which have expanded rapidly in the past few years, are to diagnose NASH with fibrosis non-invasively in order to identify patients with high risk fatty liver disease.”

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Meanwhile, another important development took place for Madrigal, which is best described in the words of Becky Taub, M.D., Chief Medical Officer and President of Research & Development of Madrigal, who said, “As we have recently reported, including in presentations by NASH experts over the past week at the Digital International Liver Congress™ 2020 (EASL), secondary analyses of data from our Phase 2 NASH study demonstrate that liver fat reduction at three months after starting treatment has clear predictive power for NASH resolution and fibrosis reduction on subsequent liver biopsy. Further, once daily oral 80 mg and 100 mg Phase 3 doses of resmetirom deliver at least 50% reduction in liver fat, and, based on secondary analyses of Phase 2 data, are associated with a statistically significant reduction in all components of NASH, including 64% NASH resolution (p<0.0001), of which >60% had fibrosis reduction. Finally, data from these analyses demonstrate that resmetirom robustly and statistically significantly (p<0.001) reduces markers of net collagen deposition in the liver, supporting the anti-fibrotic action of resmetirom. The related presentations by NASH experts at EASL are available here: EASL Presentations by NASH Experts_August 2020.”

So, the EASL data demonstrated three things – one, liver fat reduction is a strong predictive marker of NASH resolution; two, both doses of resmetirom to be used in the phase 3 MAESTRO studies delivered strong liver fat reduction, and lastly, that the achieved liver fat reduction was associated with statistically significant NASH resolution, including fibrosis reduction.

Coming to the OLE (open label extension) study whose data was presented at AASLD recently, data confirmed “robust liver fat reduction on MRI-PDFF and reduction in liver fibrosis measured on magnetic resonance elastography (MRE) at Week 16 of resmetirom treatment.”

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Becky Taub, M.D., Chief Medical Officer and President of Research & Development of Madrigal, stated, “The data from the ongoing open label arm of MAESTRO-NAFLD-1 confirm the robust effects of a 100 mg dose of resmetirom with direct actions in the liver at 16 weeks to statistically significantly reduce, compared to baseline, both hepatic fat on serial MRI-PDFF as well as meaningfully reduce a measure of liver fibrosis assessed by serial MRE. MRI-PDFF reduction was 53% overall and up to 62% in key subgroups. Marked lowering (p<0.0001) of multiple atherogenic lipids and lipoproteins was also observed, including LDL-C and apolipoprotein B >22%, triglycerides >25% and lipoprotein (NYSE:A) >30%. These data at a dose used in the ongoing serial liver biopsy study, MAESTRO-NASH, predict that a high percentage of MAESTRO-NASH patients will achieve a level of liver fat reduction that has been shown, with this mechanism of action, to be associated with improvement in NASH and liver fibrosis on liver biopsy.”

So the data from the 100 mg resmetirom arm, the same dosage as in the NASH study, showed high hepatic fat reduction, 53% overall and up to 62% in key subgroups. Recall that just >30% reduction is considered a high achievement in NASH studies, so these results are tremendous. Serial MRE data also demonstrated high measure of liver fibrosis resolution, which again correlates fat reduction as a surrogate endpoint of NASH resolution. In a key subgroup of SHBG high patients, fibrosis was near normalised after treatment of only 16 weeks.

The following is a graph of fat reduction as seen in the patients:

As we can see, 30% reduction was observed in every subgroup. Patients achieving greater than 5% weight loss reported the highest liver fat reduction on treatment.

One of the strong angles for the drug is its moderate safety profile. That was again demonstrated in the OLE arm of the study, as follows:

The drug was well-tolerated, with loose stools lasting more than 2 weeks in just 6.5% patients. No other major AEs were observed. The selectivity of the THR-β drug was again demonstrated by lack of thyrotoxic effects. This supported the 100mg dose, including in patients on thyroxine treatments.

All this data strongly predicts that the MAESTRO studies will meet their primary endpoints satisfactorily and without safety concerns.

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As of September 30, 2020, Madrigal had cash, cash equivalents and marketable securities of $335.9 million, compared to $439.0 million at December 31, 2019. The decrease in cash and marketable securities resulted primarily from cash used in operations of $102.6 million. The company’s market cap is $1.75bn and price at the time of writing was $113.26. If previous data is anything to go by, the company has enough cash until the NAFLD study completion, which will be a major catalyst. If successful, this could be material for an NDA in the NAFLD population, with approval by end-2022 or earlier depending on accelerated approval status. The company has a cash runway even until then. If this happens – ie NAFLD approval by 2022 – then from the ensuing stock price appreciation, as well as from the revenue stream generated, there will be no fear of dilution for existing shareholders.

One issue I see here is that insiders are selling, and not buying.


I do not know why; this could be just mundane reasons. Good to see just a few are selling, but I would have loved to see other insiders buying stock.


For over a year now, I have stated that MDGL is a solid buy. Despite the 20% price appreciation since I said that last, the stock is still a buy. With a much better safety profile than Intercept’s (ICPT) OBA, resmetirom will be a game changer in the hepatic liver disease arena.

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Disclosure: I am/we are long MDGL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.


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