Intercept Pharmaceuticals has announced that its treatment in patients with a progressive fatty liver disease showed an improvement in scarring on the organ, taking the drug a step closer to approval and sending the company’s shares surging 25%.

The news puts them ahead in the race to develop a new treatment for nonalcoholic steatohepatitis (NASH), as Gilead said last week that a late-stage study of its experimental drug aimed at treating NASH failed to meet its main goal.

Intercept tested the treatment, obeticholic acid (OCA), in patients with liver fibrosis, and late-stage study found that a once-daily higher dose of 25 milligram met the main goal of fibrosis improvement with no worsening of NASH after 18 months.

The study showed that a higher number of patients in the two dosage arms achieved the main goal of NASH resolution with no worsening of liver fibrosis compared with a placebo, but the company said it was not statistically significant, and that it intends to file for regulatory approval in the US and Europe in the second half of 2019.

“The topline data we are reporting today support our belief that OCA will become the first approved medicine for those living with liver fibrosis due to NASH,” chief executive officer Mark Pruzanski said in a statement.