Why Did GALT Shares Plummet Over 30% Today?

Galectin Therapeutics said it had received feedback from the FDA on its belapectin drug and also announced a new $10 million line of credit.

• Following the written FDA response, the company believes there is alignment with the agency on the proposed patient population for enrollment in its registration trial.
• The company also plans to pursue another follow-up meeting to finalize details on the next clinical trial design that were not fully resolved in the written response.  
• Galectin Therapeutics also secured a $10 million line of credit from its chairman that would cover its expenditures until at least March 2027.

Galectin Therapeutics Inc. (GALT) shares plunged more than 30% in Friday morning trading after the company announced it had received feedback from the U.S. Food and Drug Administration (FDA) on its belapectin drug. The pharma company also announced a new $10 million line of credit.

The company said that the FDA provided a written response to its Type C meeting—a non-urgent, non-milestone meeting—request regarding the development of belapectin, its investigational galectin-3 inhibitor for patients with MASH cirrhosis and portal hypertension.

The FDA feedback has led Galectin Therapeutics to believe that there is alignment with the agency on the patient population proposed for enrollment in a registration trial.

Separately, the company announced that its chairman, Richard E. Uihlein, will provide a $10 million unsecured, convertible line of credit financing.

FDA Clarification

Galectin Therapeutics had requested an in-person or teleconference meeting with the FDA to address its queries regarding the development of belapectin. However, the FDA converted its initial request for a meeting to a written response.

The company now plans to pursue another follow-up Type C meeting to finalize details on the next clinical trial design that were not fully resolved in the written response, it said.  

Galectin Therapeutics believes the meeting will provide an opportunity to clarify recent biomarker data that were not added to the initial submission ,and said that the next FDA interaction would be important to gain full clarity to advance belapectin towards the next Phase 3 clinical trial.

Line Of Credit

The $10 million unsecured, convertible line of credit from the company’s chairman, along with its cash reserves, would fund Galectin Therapeutics’ expenditures until at least March 2027, it said. The maturity dates of all convertible lines of credit and convertible notes payable to its chairman have been extended through June 30, 2027.

“This additional financing will enable us to continue to explore multiple strategies for the advancement of belapectin. We will provide updates as they become available,” Joel Lewis, Chief Executive Officer at Galectin Therapeutics, said.

“Our focus remains on advancing belapectin for patients with MASH cirrhosis and portal hypertension,” he added.

How Did Stocktwits Users React?

On Stocktwits, the retail sentiment around Galectin Therapeutics remained in the ‘bullish’ territory over the past 24 hours, and message volume stayed at ‘high’ levels.

GALT was among the top trending tickers on Stocktwits at the time of writing.

One user highlighted their bullish stance on GALT stock, stating that more clarity would come after the in-person FDA meeting.

Shares of GALT are up over 263% this year.

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