On Monday, shares of Larimar Therapeutics experienced a significant decline following a data update from its ongoing Friedreich’s ataxia treatment study. The update included reports of serious adverse events (SAEs) affecting two patients, both of whom chose to withdraw from the study. Despite these events resolving within 24 hours, the stock briefly plummeted by as much as 51% in New York trading before recovering slightly to a 25% loss.
The company, in a premarket statement, asserted that the daily subcutaneous injections of 25 mg nomlabofusp were “generally well tolerated for up to 260 days” in the open label extension (OLE) study. Larimar remains committed to its goal of submitting a Biologics License Application (BLA) to U.S. regulators in the second half of 2025, aiming for potential accelerated approval for the treatment of the rare neurodegenerative disease.
According to a press release dated December 16, 2024, Larimar announced positive initial data from the OLE study, showing that nomlabofusp increased and maintained tissue frataxin (FXN) levels. The company also observed early trends indicating potential clinical benefits. The treatment appears to have reached a steady state by Day 30, and the dose escalation to 50 mg has begun in six participants. Additionally, adolescent screening for a pediatric pharmacokinetic (PK) study is underway, with dosing expected early in 2025.
Despite the setbacks, analysts from Leerink Partners, Citi, and Guggenheim shared their perspectives on the stock’s potential. They acknowledged the adverse events but emphasized the encouraging biomarker and functional data, the company’s strong balance sheet, and the continued development of the nomlabofusp program. They also noted that the stock’s reaction to the safety news seemed overdone and advised buying on the dip, reiterating confidence in the drug’s favorable risk/benefit profile.
Larimar ended the third quarter of 2024 with $203.7 million in cash and investments, extending its financial runway into the second quarter of 2026. The company is preparing for key upcoming milestones, including the initiation of a global confirmatory/registration study in mid-2025, initial data from the 50 mg dose in the OLE study, and the targeted BLA submission for potential accelerated approval in the second half of 2025.
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