FDA policy shift drives up Adial Pharmaceuticals stock price

LootboxPhobia · 2026-02-24T12:11:41+00:00

Adial Pharmaceuticals Inc. stock price increased by 2.9% as the company announced that new FDA policies could reduce the number of critical trials required for drug approval. This change involves modernizing the evidence standards for drug approval, potentially lowering costs and speeding up new drug applications. Adial's main candidate drug, AD04, aims to treat alcohol use disorder.

LootboxPhobia

2026-02-24 12:11:41

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Investing.com – Adial Pharmaceuticals Inc. (NASDAQ:ADIL) stock rose 2.9% on Monday after the company announced that the FDA’s latest policy direction could reduce the number of critical trials needed for drug approval.

The clinical-stage biopharmaceutical company noted that FDA Director Martin A. Makary and Vinay Prasad published a commentary in The New England Journal of Medicine on February 19, 2026, outlining a shift in the agency’s evidence standards. Under the updated approach, drug approval can be supported by a sufficiently robust and well-controlled clinical study along with confirmatory evidence, rather than the historically expected two independent pivotal studies.

This policy reflects a modernization of the evidence standards under Section 505(d) of the Federal Food, Drug, and Cosmetic Act, emphasizing trial quality and confirmatory support over trial quantity.

Adial has traditionally considered conducting two pivotal trials for its lead candidate AD04 in its Phase 3 strategy. The company stated that the new policy direction could significantly reduce Phase 3 costs, improve capital efficiency, and accelerate the submission process for new drug applications.

AD04 is a gene-targeted 5-HT3 receptor antagonist being developed to treat alcohol use disorder in patients with severe alcohol dependence. The company indicated plans to communicate with the FDA regarding an appropriate evidence strategy for AD04 that meets current regulatory standards.

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