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NEW YORK (TheStreet) -- Intercept Pharmaceuticals (ICPT) - Get Intercept Pharmaceuticals, Inc. Report knew last January that abnormal cholesterol levels in patients contributed to the early stopping of a clinical trial involving its liver disease drug obeticholic acid, or OCA, but the company chose not to tell investors and lobbied government scientists conducting the trial to downplay the potentially worrisome safety finding, according to newly released emails.

These emails, made public through the Freedom of Information Act, provide a behind-the-scenes look at the days before Intercept's Jan. 9, 2014 announcement about the OCA clinical trial in patients with nonalcoholic steatohepatitis, or NASH.

In that announcement, Intercept said the clinical trial was stopped early after an interim analysis found a "highly statistically significant improvement" in the livers of patients treated with OCA compared to placebo. Intercept's stock price skyrocketed from $72 to $445 per share in two trading days following the Jan. 9 news release. In that same time period, the market value of Intercept increased six-fold to $8.4 billion.

But patients treated with OCA were also observed to have "significant lipid abnormalities" not seen in placebo patients, according to a written summary of a phone conversation between National Institutes of Health Program Director Dr. Averell Sherker and Intercept Chief Scientific Officer David Shapiro on Jan. 6.

On this call, Shapiro was told by Sherker that the decision made by the NIH's National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK) to stop the OCA trial early was based on positive efficacy and the negative safety signal.

"Intercept has a fiduciary responsible [sic] to publicly release Material Information in a timely manner," Sherker's summary of the Shapiro Jan. 6 phone call states. "Intercept has a previously scheduled Quarterly Webinar on January 9 and will mention that NIDDK has informed them that the treatment phase of the study has been terminated on the basis of efficacy and that lipid abnormalities have been observed. Additionally, Intercept will release a press release with the same information."

When Intercept broke the news publicly three days later on Jan. 9, nothing about the "significant lipid abnormalities" or its role in stopping the OCA study was disclosed.

Why? Shapiro explains to Sherker in an email sent on Jan. 7, the day following their phone conversation. In the email, Shapiro tells Sherker that he consulted with Intercept CEO Mark Pruzanski about how the company intended to disclose news about the stopping of the OCA clinical trial.

"I  think we should just aim to keep the release simple...," writes Shapiro in the email. He goes on to tell Sherker that the release will only say that NIDDK informed the company about the planned interim efficacy analysis achieving the primary endpoint with statistical significance.

Shapiro then adds, "We don't think that without the specific data, we can comment on the lipid changes. We have previously reported HDL and LDL changes (see attached)."

Later on Jan. 7, NIH's Sherker replies to Shapiro at Intercept via email:

"With respect to the lipid abnormalities, I will defer to you about the decision whether or not to include it in your press release," Sherker writes. "As I mentioned yesterday, the NIDDK decision to terminate therapy was primarily due to the efficacy effect but, in part, influenced by the significant lipid abnormalities observed in the OCA treated patients."

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Intercept's Jan. 9 press release makes no mention of the abnormal cholesterol findings which influenced the decision to stop the OCA trial.

On the evening of Friday Jan. 10, right before the start of the weekend, the NIDDK issued its own public statement about the OCA trial, disclosing the "interim results also found disproportionate lipid abnormalities (increased total cholesterol with increased LDL and decreased HDL cholesterol) in patients on OCA compared to those on placebo."

Interestingly, the NIDDK statement does not say the decision to stop the OCA trial was influenced by the negative cholesterol observations. In fact, the statement almost goes out of its  way to downplay the safety concerns, stating that "lipid abnormalities are common in people with NASH" and the "limited additional information" about the interim results was done to give a "broader context for the findings."

Why NIDDK chose to soft-pedal the fact that the OCA trial was stopped, in part, because of the negative cholesterol findings isn't known. However, Intercept appears to have lobbied the government scientists to do so, according to an email sent by Intercept's Shapiro to NIH's Sherker in the early evening of Jan. 10, hours before NIH's NIDDK issued its own statement.

"Averell -- The lipid information is specific and I think will cause issues. If this hasn't been issued already can we discuss first. At least it would be good to mention that similar findings had been seen previously," Shapiro writes.

Intercept declined to comment for this story. The NIH would not make Sherker available for comment, choosing instead to reiterate the statement made about the OCA trial on Jan. 10. The emails and phone call log were obtained through a FOIA request made by a healthcare investment research firm, which has a sell recommendation on Intercept. TheStreet obtained a copy of the research firm's report, including the emails and phone call log, from an investor with no position in Intercept.

The Wall Street Journalfirst reported on the NIH statement regarding abnormal cholesterol levels in OCA-treated patients on Jan. 10. In the story, Intercept CEO Pruzanski offers an explanation:

In a phone interview Friday, Intercept Chief Executive Mark Pruzanski said Intercept also received a statement from the NIH after the market's close Friday about lipid abnormalities. He said earlier in the week, before Intercept announced the positive clinical trial results, the NIH told the company that patients taking the drug had experienced "lipid effects," but the NIH didn't provide any detail.

When Intercept announced the positive study results in a statement Thursday, "we had no concrete data with respect to lipids," Dr. Pruzanski said. "All they gave us that was concrete that we could comment on was the level of statistical significance that was the basis for the decision to stop the study early for efficacy," he said.

Based on the new disclosures in the emails between the NIH and Intercept's top scientist, Pruzanski has some more explaining to do.

Intercept shares closed Monday at $260.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback;

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