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Conatus (CNAT) Focuses on Developing NASH Candidate Emricasan

Zacks Equity Research
Molina's (MOH) first-quarter earnings benefit from lower expenses.

On Mar 20, we issued an updated research report on Conatus Pharmaceuticals Inc. CNAT. This San Diego-based company has no approved product in its portfolio at the moment and focuses on developing its lead pipeline candidate, emricasan.

Emricasan, a caspase inhibitor, is being developed for the treatment of patients with fibrosis or cirrhosis caused by nonalcoholic steatohepatitis (NASH). Conatus acquired the worldwide rights to emricasan from Pfizer PFE in July 2010. The company has an exclusive option, collaboration and license agreement with Novartis NVS for the worldwide development and commercialization of emricasan.

Conatus is conducting three phase IIb ENCORE studies on emricasan for treating fibrosis or cirrhosis induced by NASH. The programs are, namely ENCORE-NF (for NASH fibrosis), ENCORE-PH (for portal hypertension) and ENCORE-LF (for liver function).

Last December, Conatus announced top-line results from the ENCORE-PH evaluation. In the program, emricasan demonstrated clinically meaningful treatment effects on compensated NASH cirrhosis patients, who stand at the risk of passing to the decompensation state. However, the study failed to meet its primary endpoint. Following a post hoc analysis, emricasan demonstrated a clinically meaningful treatment impact compared with placebo. Additional results are now awaited in mid-2019.

Meanwhile, in February 2019, Conatus completed enrolling patients in the ENCORE-LF study. Top-line data from the investigation is expected in mid-2019 while top-line findings from the ENCORE-NF study are anticipated to be released in the first half of 2019.

Positive outcomes from these studies will pave the way for a phase III efficacy and safety assessment on the candidate for the given disease.

Notably, the NASH market holds untapped prospects. People afflicted with diabetes, high cholesterol or high triglycerides are often diagnosed with this indication, which is feared to become the fastest-growing cause for liver transplant and liver cancer. With no treatments currently available for this malady, the market opportunity for emricasan seems substantially huge.

However, several companies like Allergan AGN, Intercept Pharmaceuticals, Galectin Therapeutics, Enanta Pharmaceuticals are working on developing therapies for the same. Additionally, interest in this market has gone up of late, considering that several companies are inking deals and others aiming for an entry into the same space, all because of its high-revenue potential.

Given such an optimistic scenario, we believe that on approval, emricasan has the power to capture a large market share.

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