NASH: The Second Wave – Seeking Alpha

In my previous article regarding NASH disease and the potential winners of the first wave drugs, I made a comparison of efficacy of the late stage drug candidates which have better chances to be first in the market of NASH. For those who are interested, please click here.

In this article, I would like to share my thoughts regarding the drug candidates of the second wave and the possible leaders among them.

At the same time, I would like to compare the "second wave" NASH drugs using available data to identify the lead drug candidate. This comparison itself may be interesting later in 2020 when a lot of NASH catalysts are coming.

Also, I would like to share which company is my favorite based on risk/reward opportunity.

I will try to make a short list of potential winners of the second wave and briefly explain the reasons.

As you know, NASH is very complicated condition where many parameters matter, but the major FDA surrogate endpoints for NASH are: 1) resolution of steatohepatitis with no worsening of fibrosis or 2) improvement of fibrosis with no worsening of steatohepatitis or 3) both.

In our previous article, we made a brief description of NASH and disease statistics. I just want to point out some statistical information:

According to National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK), 30-40% of adults in United States have NAFLD and 20% of people with NAFLD have NASH.

These figures mean that more than 40 million people in the US have NAFLD and more than 8 million people have NASH accordingly.

According to another study, the global prevalence of NAFLD is 25.24%, with highest prevalence in Middle East and South America. Due to the fact that NASH requires histological diagnosis, we can assume that there are uncountable millions of people with NASH in developing countries. Based on NASH-NAFLD prevalence ratio, the global estimation for NASH is more than 180 million people.

Many companies are pursuing the possibilities of effective treatment of this disease by exploring different approaches:

Source: NASH Landscape in one picture/Evercore ISI Research

It looks like fierce competition awaits these companies. But the reality is different. Only a few will be able to bring their drugs to the final stage and more importantly, these drugs should have better efficacy and safety than the late stage rivals. It seems that a very small number of companies will succeed. This suggests that the prize for winning in this competition will be very attractive.

In our previous assessment, we chose Madrigal Pharmaceuticals' (NASDAQ:MDGL) Resmetirom among the late stage candidates due to better efficacy and safety.

As you can see from the image above, we will have to compare the efficacy and safety of many drug candidates in order to make our preliminary assessment.

So, we will use Madrigal's resmetirom results as a benchmark to compare with the possible second-wave rivals:

Source: created by the author for previous article "Potential Winner Of The First NASH Battle"

And additional data released by Madrigal Pharmaceuticals (MDGL):

Source: Madrigal Pharmaceuticals' Corporate Presentation

Source: Madrigal Pharmaceuticals' Corporate Presentation

Resmetirom had achieved 55% liver fat reduction at week 36, 22.3% LDL-C lowering, Apolipoprotein B reduction by 27.6%. At the same time, Adiponectin increase from baseline was 31% (100mg cohort).

These results were the most promising among the late stage drug candidates for NASH treatment until recently.

Now, we have to look through the following companies and their drug candidates pursuing to effectively treat NASH:

Source: created by the author

We had 23 drug candidates in 2019 with different mechanisms of action (MOA). Let's see how the list has changed since 2019:

Source: created by the author

Let's exclude terminated, halted studies, trials failed to meet primary endpoints and 2 private companies:

Source: created by the author

It is obvious that our list will be substantially corrected later in 2H 2020 due to the many catalysts for these drug candidates. And maybe the list itself will be shortened more in 2020.

We will try to use already available markers to make a preliminary assessment. Let's try to briefly summarize the available data on the above drug candidates.

AKR-001 is Fc-FGF21 fusion protein - analog of the FGF21 hormone.

Currently, AKR-001 is at Phase-2 to evaluate safety and efficacy in patients with biopsy proven NASH (study: NCT03976401).

Here are some brief tables summarizing already shared data on AKR-001:

Source: Akero Therapeutics Presentation at J.P. Morgan Healthcare Conference

Source: Akero Therapeutics Presentation at J.P. Morgan Healthcare Conference

Source: Akero Therapeutics Presentation at J.P. Morgan Healthcare Conference

The above biomarkers have a significant indicative role in NASH disease. And could be predictive markers of efficacy. I would like to emphasize that this fact is confirmed by many studies and described in many scientific publications. I highly recommend reading these publications for anyone interested in any NASH company.

Here is a brief list of scientific publications on correlation between these biomarkers and NASH pathophysiology:

Therefore, we must pay a serious attention to these indicative biomarkers that are closely related to the pathophysiology of NASH.

Based on the above, the AKR-001 data looks very promising, and there is a high probability that AKR-001 may have the best results among the current NASH candidates.

2. Albireo Pharma (NASDAQ:ALBO)/Drug candidate: Elobixibat.

Elobixibat is ileal bile acid transporter (IBAT) inhibitor. Elobixibat is currently at Phase-2 for NAFLD/NASH (study: NCT04006145). Regarding elobixibat, we have only small study results published in BMC Cardiovascular Disorders journal in 2015 which can give us some hints about potential of IBAT inhibitor in LDL cholesterol reduction and LDL/HDL ratio.

Results

In the dyslipidemia study LDL cholesterol was reduced by 7.4 % (p = 0.044), and the LDL/HDL ratio was decreased by 18 % (p = 0.004). Serum C4 increased, indicating that BA synthesis was induced. No serious adverse events were recorded. In the CC study, GLP-1 increased significantly in both the 15 mg (20.7 2.4 pmol/L; p = 0.03) and the 20 mg group (25.6 4.9 pmol/L; p = 0.02).

The preliminary data does not give us the opportunity to talk about the serious chances of this candidate compared to others. Certainly, some level of efficacy is expected, but the data in my opinion is weak in comparison with its rivals. So, I will not include Elobixibat to the final list.

3. AstraZeneca (NYSE:AZN) / drug candidate: MEDI-0382 (Cotadutide).

Cotadutide is glucagon-like peptide-1 (GLP-1) and glucagon receptor dual agonist.

Currently, cotadutide (MEDI-0382) is at Phase 2 for NASH/NAFLD (study: NCT04019561).

Here are some brief tables shared during AASLD meeting in Boston (November 2019):

Source: AASLD meeting Boston November 2019

As in the previous case, we observe possible effectiveness, but unfortunately, it's likely to be not so strong. At least, biomarkers do not show strong efficacy.

But this increases the chances of AstraZeneca to be considered as potential buyer of efficient NASH treatment option.

4. Bristol-Myers Squibb (NYSE:BMY)/drug candidate: Pegbelfermin

Pegbelfermin is pegylated FGF21 analog. Currently, pegbelfermin is at Phase 2 for NASH and Stage 3 Liver Fibrosis (study: NCT03486899) .

Company published the data on previous findings in Obesity Journal (Silver Spring MD):

Source: Obesity Journal (Silver Spring MD)

Pegbelfermin shows promising activity in my point of view. LDL-C change from baseline was -12%, HDL-C increase was +15%, Adiponectin increase was +38% from baseline. This data shows a high probability that pegbelfermin could be efficient in NASH treatment among other drug candidates.

5. Eli Lilly (NYSE:LLY)/Drug candidate: Tirzepatide.

Tirzepatide is dual GLP1 (glucagon-like peptide-1) and GIP (glucose-dependent insulinotropic polypeptide) receptors agonist which is currently at Phase 2 for NASH (study: NCT04166773). NCT04166773

Here is some informative data on tirzepatide efficacy:

Source: ConsienHealth

Source: Pharmnews

Unfortunately, as in cases 2 and 3, these data do not indicate a high probability of serious efficiency in NASH treatment. So, we will not include tirzepatide to our "second wave" NASH short list, but we will include Eli Lilly (LLY) to our list of "potential active NASH buyers".

6. Enanta Pharmaceuticals (NASDAQ:ENTA) / Drug candidate: EDP-305.

EDP-305 is FXR agonist and company's lead candidate for NASH. The company released the data of Phase-2a (ARGON-1 study) in September 2019 and is planning Phase-2b:

The study's primary endpoint was achieved with a statistically significant ALT reduction of 28 U/L in the EDP-305 2.5mg arm versus 15 U/L in the placebo arm at week 12 (p=0.049).

As with our primary endpoint, there was a statistically significant reduction in liver fat content with EDP-305 at the 2.5mg dose as measured by MRI-PDFF (p<0.001). Forty-five percent (45%) of subjects were MRI-PDFF responders (i.e. 30% fat reduction). EDP-305 also exhibited strong target engagement as shown by reductions in C4 and increases in FGF-19 and ALP. A robust GGT reduction was also observed.

Overall, EDP-305 was generally safe, with the majority of treatment-emergent adverse events (TEAEs) being mild to moderate. The most common (5%) TEAEs included pruritus, gastro-intestinal (GI) related symptoms (nausea, vomiting, diarrhea), headache and dizziness. A consistent safety profile has been observed across more than 400 subjects exposed to EDP-305 across all studies to date. As for tolerability of EDP-305 in this 12-week Phase 2a study, pruritus was present in approximately 51% of the subjects in the 2.5mg arm compared to less than 10% in the 1mg arm, with the majority being mild or moderate in severity. The incidence of treatment discontinuation due to pruritus was 1.8% for 1mg and 20.8% for 2.5mg, with all the discontinuations in the 2.5mg arm being due to moderate pruritus.

Treatment with EDP-305 was associated with a very modest effect on lipids as demonstrated by a minimal absolute change of 6 mg/dL, 5 mg/dL, and -4 mg/dL, with the 2.5mg dose, 1mg dose and placebo, respectively.

Source: Enanta Pharmaceuticals Comparison of key 12-week ARGON-1 data for EDP-305 with the FXR Agonists Obeticholic Acid, Cilofexor and Tropifexor

Source: Enanta Pharmaceuticals Comparison of key 12-week ARGON-1 data for EDP-305 with the FXR Agonists Obeticholic Acid, Cilofexor and Tropifexor

This data can be compared with Madrigal's (resmetirom) results and seems that EDP-305 has high likelihood of inferiority to resmetirom. So, I will exclude it from my short list of promising "wave two" candidates.

7. Galmed Pharmaceuticals (NASDAQ:GLMD) / Drug candidate: Aramcol.

Aramcol (arachidyl amido cholanoic acid) is SCD-1 modulator with Phase-2 results shared by the company in AASLD 2018.

Here are the brief tables summarizing the results of NASH study:

Source: Galmed Presentation at AASLD

Aramcol has shown efficacy in NASH, but the results are inferior to resmetirom (16.7% NASH resolution without worsening of fibrosis at highest dose).

8. Inventiva S.A. (OTCPK:IVEVF) (IVA.PA) / Drug candidate: Lanifibranor.

Lanifibranor (former IVA337) is oral PPAR agonist activating PPAR, PPAR and PPAR. The drug is currently at Phase-2 for NASH with biopsy data expected in 1H 2020. (Study: NCT03008070).

Here are some brief tables shared by the company:

Source: Company's corporate presentation

Lanifibranor shows high probability of efficacy: Triglycerides change from baseline: -28% (at highest dose)/HDL-C change from baseline: +28% (at highest dose). But we don't have enough biomarker data to include lanifibranor to our short list of the most promising candidates.

9. NGM Biopharmaceuticals (NASDAQ:NGM) / Drug candidate: NGM-282 (aldafermin).

Aldafermin (NGM-282) is human FGF19 analog which is currently at Phase-2 for NASH with compensated cirrhosis (study: NCT03912532).

The company expects to share the 4th cohort biopsy data from previous Phase-2 trial in Q1 2020.

Source: Company's corporate presentation

In October 2019, the company shared interim results from ongoing 24-week Phase-2 study of aldafermin (NGM-282):

The Cohort 4 interim analysis demonstrated that once-daily treatment with 1 mg of aldafermin for 24 weeks in patients with stage 2 or 3 (F2-F3) liver fibrosis resulted in a statistically significant change in the absolute liver fat content (LFC) of -7.9% (measured by magnetic resonance imaging-estimated proton density fat fraction, or MRI-PDFF), as compared to -2.0% in the placebo arm (p<0.05), and a statistically significant change in relative LFC of -39.6%, as compared to -5.9% in the placebo arm (p<0.05). As per the study protocol, results were calculated using least square (LS) mean, which is a statistical approach that adjusts for observed baseline differences. 72% of patients treated with aldafermin achieved a 5% absolute reduction in LFC versus 17% for placebo. Similarly, 72% of patients treated with aldafermin achieved a 30% relative reduction in LFC versus 17% for placebo. Of the patients treated with aldafermin, 28% achieved a normal LFC after 24 weeks, defined as 5% absolute LFC, versus none in the placebo arm. In addition, in assessing biomarkers of liver inflammation and injury, treatment with aldafermin resulted in clinically meaningful reductions in alanine aminotransferase (ALT) and aspartate aminotransferase (AST). Treatment with aldafermin also resulted in a statistically significant reduction in PRO-C3, an exploratory biomarker of liver fibrogenesis, as compared to placebo.

Here are some brief tables summarizing the data from previous cohorts as well:

Source: Company's corporate presentation

Source: NGM282 in NASH: 3 mg QD (phase 2)

The data looks very promising, and there is a high probability that NGM-282 may have great results. So, I will include it to my short list of "wave two" candidates.

10. Novartis AG (NYSE:NVS) / Drug candidate: Tropifexor (former LJN452).

Tropifexor is FXR agonist which is currently at Phase-2 for NASH monotherapy (study: NCT02855164) and as a combination with Cenicriviroc (study: NCT03517540).

Here is data available for tropifexor (previously shared at AASLD):

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NASH: The Second Wave - Seeking Alpha