On November 1, 2017 Conatus Pharmaceuticals Inc. (Nasdaq:CNAT), a biotechnology company focused on the development and commercialization of novel medicines to treat liver disease, reported financial results for the quarter and nine months ended September 30, 2017, and provided updates on its development programs (Press release, Conatus Pharmaceuticals, NOV 1, 2017, View Source [SID1234521452]).
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Program Updates
In collaboration with Novartis under terms of the company’s Option, Collaboration and License Agreement with Novartis, which was executed in December 2016, Conatus is conducting four randomized, double-blind, placebo-controlled Phase 2b clinical trials designed to evaluate emricasan treatment in various patient populations, including three EmricasaN, a Caspase inhibitOR, for Evaluation (ENCORE) clinical trials in patients with fibrosis or cirrhosis caused by nonalcoholic steatohepatitis (NASH), and a fourth clinical trial in POLT-HCV-SVR patients:
POLT-HCV-SVR, initiated in the second quarter of 2014, in approximately 60 post-orthotopic liver transplant (POLT) recipients with liver fibrosis or cirrhosis post-transplant as a result of recurrent hepatitis C virus (HCV) infection who have successfully achieved a sustained viral response (SVR) following HCV antiviral therapy, with top-line results expected in the second quarter of 2018;
ENCORE-PH (for Portal Hypertension), initiated in the fourth quarter of 2016, in approximately 240 patients with compensated or early decompensated NASH cirrhosis and severe portal hypertension, with top-line results expected in the second half of 2018 followed by an integrated treatment extension period for clinical outcomes;
ENCORE-NF (for NASH Fibrosis), initiated in the first quarter of 2016, in approximately 330 patients with NASH fibrosis, with top-line results expected in the first half of 2019; and
ENCORE-LF (for Liver Function), initiated in the second quarter of 2017, in approximately 210 patients with decompensated NASH cirrhosis, with top-line results expected in the second half of 2019.
Results from the four ongoing emricasan clinical trials are expected to support the design of Phase 3 clinical efficacy and safety trials.
Pipeline Expansion Plans
In October 2017, the European Medicines Agency (EMA) granted Orphan Drug Designation in the European Union to the company’s pan-caspase inhibitor IDN-7314 for the treatment of primary sclerosing cholangitis (PSC), a disease affecting bile ducts in the liver, which can lead to cirrhosis and liver failure. In June 2017, the U.S. Food and Drug Administration (FDA) granted Orphan Drug Designation in the United States to IDN-7314 for the treatment of PSC.
These orphan drug designations were based on previously reported data with IDN-7314 demonstrating reduction of relevant biomarkers in two preclinical models of PSC. New results, showing that IDN-7314 markedly diminished inflammasome activation and reduced liver injury in a preclinical model of PSC, were presented in October 2017 at The Liver Meeting, the annual meeting of the American Association for the Study of Liver Diseases (AASLD). In a separate study, IDN-7314 reduced biochemical markers in a new acute preclinical model of PSC.
Conatus believes the orphan drug designations, along with the growing body of preclinical data, warrant further evaluation of IDN-7314 as a potential product candidate in PSC as a component of its initial pipeline expansion plans. The company’s ongoing pipeline expansion activities also include:
internal development of new preclinical product candidates leveraging its expertise with the caspase inhibition technology platform, and
evaluation for potential in-licensing or acquisition of external clinical-stage product candidates consistent with its product development and regulatory expertise.
Conatus may pursue the development of product candidates in liver disease and in other related disease areas.
Financial Results
The net loss for the third quarter of 2017 was $4.0 million compared with $6.9 million for the third quarter of 2016. The net loss for the first nine months of 2017 was $13.0 million compared with $20.6 million for the first nine months of 2016.
Total revenues were $9.6 million for the third quarter of 2017 and $26.6 million for the first nine months of 2017, compared with $0.0 million for the comparable periods in 2016. Total revenues for both periods in 2017 consisted of collaboration revenue related to the Option, Collaboration and License Agreement with Novartis.
Research and development expenses were $11.2 million for the third quarter of 2017 compared with $4.8 million for the third quarter of 2016. Research and development expenses were $32.3 million for the first nine months of 2017 compared with $13.8 million for the first nine months of 2016. The increases in research and development expenses were primarily due to the ramp up of our ENCORE-NF, ENCORE-PH and ENCORE-LF clinical trials.
General and administrative expenses were $2.4 million for the third quarter of 2017 compared with $2.1 million for the third quarter of 2016. General and administrative expenses were $7.4 million for the first nine months of 2017 compared with $6.9 million for the first nine months of 2016. The increases in general and administrative expenses were primarily due to higher personnel costs and professional fees.
Cash, cash equivalents and marketable securities were $85.2 million at September 30, 2017, compared with $77.0 million at December 31, 2016. Based primarily on lower than expected spending on in-licensing and internal pipeline development, the company is now projecting a year-end 2017 balance of between $70 million and $75 million. The company believes its current and forecasted financial resources are sufficient to maintain operations and ongoing emricasan clinical development activities through the end of 2019, as well as to fund anticipated pipeline expansion activities.
Conference Call and Audio Webcast
Conatus will host a conference call and audio webcast at 4:30 p.m. Eastern Time today to discuss the financial results and provide a corporate update. To access the conference call, please dial 877-312-5857 (domestic) or 970-315-0455 (international) at least five minutes prior to the start time and refer to conference ID 99505370. A live and archived audio webcast of the call will also be available in the Investors section of the Conatus website at www.conatuspharma.com.