(by Gery DIVRY)

 “And I've said is why deals over the years, there are point in time when you can do them. You can’t acquire something before the data mature. You can't necessarily pick your time with regard to valuation, but you have to be ready when the stars are aligned and if there is a deal to be done. And so that's what we're trying to be prepared for in a number of different scenarios right now.” 

John Milligan- CEO of GILEAD Sciences During the Morgan Stanley Global Healthcare Brokers Conference the 16th of september 2015 - 

The notion of conjunction of the planets, or alignment of planets, is fashionable.

It symbolizes the establishment of apparently distant elements but which, together, create a context favorable to the emergence of a trend.

The planets are in the process of aligning in the GENFIT’s sky, in some days, five informations created this virtuous alignment.


1- The RAPTOR withdrawal from the NASH market:

Following the absence of convincing histological results of their Phase 2b, while their serological results were very encouraging, the withdrawal of RAPTOR created a regrettable vacuum in the prospect of finding a drug to treat children with NASH. Some analysts said the withdrawal would be beneficial to other competitors laboratories indiscriminately. I think it is, as often, an unfortunate analyst shortcut .

The situation is much more complex than that.

First, the market share reassigned to other competitors is not really one. RAPTOR specifically targeted the child population, which is not the case with other competitors except GENFIT which has made numerous statements in that sense and announced a pediatric component in its future phase 3 clinical study.

Secondly, if we look at what happened in this RAPTOR failure,  we can legitimately worry about  other laboratories, like GALMED, CONATUS and  IMMURON. The lasts  announced plans to launch a phase 3 for the treatment of NASH based on a phase 2 only positive on serological criteria and imaging and without histological element to support their claims to treat NASH. GALMED is launching a phase 2b without any previous histological results ! 

As we have seen, the risk of not finding histological improvement while one had an good improvement in serological markers is high. Take the financial risk of a phase 3 without guarantees already establishing histological effects seems very risky. It is very likely they will have to execute a phase 2b with histological criteria which can delay their potential arrival on the market by more than 2 years. This is especially true for CONATUS with a phase 2 sample included only 38 patients. They'll have to be very persuasive with investors to find funding for a Phase 3 under these conditions.

It is too early to know if the planning of these two laboratory will be directly affected by this news, but my intuition tells me that this is not beneficial for them despite analysts support.

In my eyes, GENFIT is most favored by this unfortunate news



2- The postpone of simtuzumab GILEAD study results on fibrosis in NASH :

GILEAD confirmed the necessity to complete the 96 weeks of study before publishing results, a first publication was initialy expected after 48 weeks (august 2016).

It mean that they can’t expect to be on the NASH market before 2020  .. 2021  whith the simtuzumzab

This will favoring GALECTIN (GALT)  targeting fibrosis and cirrosis but also GENFIT.


3- The failing of the OCA phase 2 clinical study  in Japan

The Phase 2 clinical study conducted in Japan on OCA in NASH revealed its published results.

The results published today are the following:

A first reading is a failure of the study with no statistical significance evidence 

  • The 10 mg arm is a failure : 22% OCA vs 20% placebo mean no measurable effect of OCA on the NAS score reduction.

It would be a problem because the endpoint of the Japan study (NAS improvement ≥2 points  with no worsening of fibrosis)  was not as difficult to reach as the endpoint of the future Phase 3 REGENERATE  (NASH reversion with no worsening of fibrosis ) and one arm of the future REGENERATE study will be also a 10mg/day dose.

Regarding those results it would be very difficult to reach the endpoint on this arm in the future Phase 3.

  • The 20 mg arm is still a kind of failure :  28% OCA vs 20% placebo is a very limited effect RR =1,4

the Pruritus was high and consistent with the FLINT Study (24%)

It is the dose approaching the dose used in the FLINT Study ( 24mg)  and curiously the results are very different it can maybe explained by the ethnicity ot the patients

 The press release include à statement on that point

“There were distinct differences in baseline characteristics in this study population when compared to the Western patients in the previously conducted FLINT trial »

  • The 40 mg arm is interesting: 38% OCA vs 20% placebo is a significant effect RR =1,9 but the Pruritus was very high (50%)  and 13 patients on 50 discontinued the study (26%)

We do not have the lipidic balance induced by the treatment but they declare the changes in lipid parameters, including LDL-C, HDL-C and triglycerides, appeared to be consistent with previously reported lipid changes in Western NASH patients.

This is not good news to my opinion because they do not say if the increase of LDL is correlated to the dose.

The press release confirm the failure of the study

Dose-dependent trends not reaching statistical significance were also observed for several other pre-specified histologic endpoints, including the proportion of patients with steatosis and inflammation improvement, ballooning resolution and NASH resolution. No difference was seen in fibrosis improvement in the OCA groups compared to placebo.

Regarding the extended results published by SUMITOMO the 9 of decembre 2015, the OCA result in NASH reversion is a complete failure for all doses(10,20,40 mg)  and all NASH Reversion definitions (old and new).

the data on fibrosis improvement  are showing the same failure for all doses (10,20,40 mg)

All the study is a failure, even in fibrosis wich is the OCA advantage alleged by Intercept .. 

The bias we discovered in th FLINT study seems to be confirmed by the Japanese study on OCA .. So ! what is the real effect of OCA on NASH .  

Dhe diabetes parameter was evoqued during the last conference, since the FLINT publication, one can notice that OCA had no significant effects on patients without T2 diabetes. As the japaneses patients had less diabetes than the overrepresented population of diabetes in the FLINT study, it could be an explanation !!

But when you know all the bias of the FLINT study you were expecting a confirmation of the results in another study managed to prevent bias.. now you can be very pessimistic because the Japan results do not confirm any of the supposed positives FLINT results. 

To my opinion, the only good news  is the supposed proved Effect/Dose relation wich would be a proof of OCA efficacy on the disease but the doses needed to obtain results are not possible to use because of the strong adverses effects. 

As a new sign of this new paradigm, the last INTERCEPT conferences were focused on OCA in PBC, not NASH.


4- The development of patented biomarkers by GENFIT to diagnose NASH

This is very important for two reasons.

First, it will allow to do without biopsy to diagnose NASH, which immediately expands the market to the general population. the NASH market which was still locked in a narrow band of very achieved and diagnosed patients, expands enormously. 

a you can see on the page dedicated to the market for biomarkers, this also opens up a new market for GENFIT that could reach $ 1 Billion per year.

Second, it confime the technological and scientific advance in the knowledge of NASH by GENFIT and the official announcement that they will start their Phase 3 before the end of the year and are eligible for  SUBPART H.


5- The scientifical support of NASH Key Opinion Leaders

The results of the GOLDEN-505 phase 2b study of Elafibranor in NASH have been selected for an exclusive oral presentation during the AASDL Presidential Plenary session in San Fransisco the 16th of November 2015.

Only major scientific papers were entitled to this honor, and it is an independent scientific committee that selects the AASDL presentations worthy of figuring in plenary before 4000 world specialists of the liver. That is, they considered that the results presented by GENFIT in NASH are worthy of interest.

In the abstract published before the presentation one can read : 

This is a clear support of the Elafibranor in NASH treatment

GENFIT presented also the total success of its GOLDEN phase 2b study with the new consensual definition of NASH réversion.


6-  The publication of GOLDEN results in ‘Gastroenterology’  

this publication ( find here the comments on it ) is very positive and conclude :

In conclusion, this randomized controlled trial provides evidence that pharmacological modulation of the PPARα/δ nuclear receptors results in substantial histological improvement in NASH, including resolution of steatohepatitis, and improvement of the cardiometabolic risk profile, with a favorable safety profile. Larger phase 3 trials of elafibranor in the target population of patients with moderate to severe NASH are warranted. 

It is a confirmation of all the previous announcements


7- The Phase 3 first recruitments and announces of other clinical studies in pediatric NASH, Cirrhosis and PBC

Its confirm the leadership of GENFIT in the NASH .. still contested by some incompetents analysts..

Regarding the last market forecast on the income peak of  ELAFIBRANOR (over $ 10 billion in 2020),  and the current ratios used by large pharmaceutical companies to valuate the biotechs (between 2 and three times the forecast income peak ),  we can anticipate that investors will come back strongly on the value in the coming months.

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