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July 7 (Reuters) - Kailera Therapeutics' shares dropped 10% on Tuesday after its oral weight-loss drug showed high rates of nausea and vomiting among participants in a late-stage trial in China, overshadowing the experimental treatment's success in meeting the study's main goal.
The drug, HRS-7535, was being tested in patients with obesity and diabetes in two separate trials conducted by Kailera's China-based partner Jiangsu Hengrui Pharmaceutical.
U.S. drugmakers have been increasingly looking to China to secure the rights to promising drug candidates at a lower cost and access important early data that could pave the way for global trials.
In the obesity trial, the drug achieved a mean weight loss of up to 10.9% at week 44 and a mean weight loss of up to 11.1% at week 50, Kailera said.
The most common side effects were nausea and vomiting, reported in about 70% and more than 65% of patients receiving the drug, respectively, compared with 16.2% and 4.5% in the placebo group.
"In our view, reducing the rate of nausea and vomiting to roughly mid-30% and mid-20%, respectively, will yield a competitive profile," said William Blair analyst Andy Hsieh.
The drug was also found to be non-inferior to AstraZeneca's dapagliflozin across dose levels in the diabetes trial in terms of reducing HbA1c levels, a key marker of long-term blood sugar levels.
Kailera Therapeutics was launched in October 2024 with $400 million in early-stage funding and four obesity drug candidates licensed from Hengrui.
The company is advancing HRS-7535 in a global mid-stage clinical trial in overweight or obese adults. The trial started in April, with data expected next year.
(Reporting by Christy Santhosh in Bengaluru; Editing by Shilpi Majumdar and Leroy Leo)
