The Race to Commercialization: Examining the Current NASH?Pipeline

Nonalcoholic steatohepatitis (NASH) it’s the more severe form of Nonalcoholic fatty liver disease (NAFLD) which is characterized by the accumulation of fat in the liver cells (steatosis) and inflammation. NASH can lead to fibrosis and sometimes cirrhosis, increasing the risk for hepatic decompensation and hepatocellular carcinoma (HCC). The risk of liver-related death increases considerably as fibrosis progresses. F0 (no fibrosis) to F4 (cirrhosis) is the fibrosis scale. Those classed as F2 or F3 are the most likely to benefit from any NASH medication, accounting for 32% of the total.

NASH is a serious medical condition, and its prevalence is rapidly growing. Obesity and Type 2 diabetes are two associated comorbidities. Obesity is expected to affect 42% of individuals in the United States, with obesity incidence increasing by 26% since 2008. It is estimated that 35 million Americans have Type 2 diabetes mellitus, and 96 million have prediabetes, a condition in which glucose levels are higher than usual. Diabetes affected 108 million persons globally in 1980. According to the WHO (World Health Organization), the figure has climbed to 422 million by 2014. In 2020, the International Diabetes Federation predicted an increase to 700 million individuals by 2045. NASH affects 37% of Type 2 diabetics in the United States.

In other words, 71% of NASH patients have metabolic syndrome, 83% have dyslipidemia, 80% are obese, and 54% have Type 2 diabetes.

Current unmet need:

Even though there’s has been decades of research in understanding the mechanisms that cause NASH, there’s not an approved therapy that can directly modulate fibrosis and improve clinical outcomes in patients. Furthermore, the current detection and the way to stage liver fibrosis is biopsy, which is an invasive and resource-intensive approach. Therefore, the development of better non-invasive biomarkers is urgently needed, not only for the diagnostic but to provide indications on the biological and clinical actions of therapeutic candidates.

The current front-line NASH treatment consists of lifestyle changes like diet and exercise.

Many questions arise, is fibrosis the right mechanism to be targeted? are we targeting the right cells? maybe is time to target Cell-Cell interactions to understand the key intercellular networks that trigger or promote disease progression as possible targets to inhibit NASH-related fibrosis.

Another area where patients could benefit is with precision medicine, for example treating NASH patients carrying a variant in the PNPLA3 gene?which leads to a dysfunctional liver enzyme that is not only unable to digest fat itself but impedes another type of enzyme from doing it too.

Unfortunately, at the pre-clinical stage, there’s an urgent need for better models in the drug discovery and development process against fibrosis.

Much progress has been done to move away from simple cell culture models to organoids and liver-on-a-chip (LoC), but we are still unable to recapitulate the physiological, anatomical, and cellular complexity of the liver tissue. Only human ex vivo precision-cut liver slice (PCLSs) systems have successfully modeled fibrogenesis and demonstrated antifibrotic therapy efficacy. Nevertheless, these approaches are still in their infancy and they rely upon human samples.

Additionally, there’s no agreement on which animal model provides the closest approximation of human disease, with the immune system and microbiota as some of the problems that are inherent to differences between mice and humans, as well as the lack of consideration of biological sex, genetics and ethnic variations in the human population that influence disease progression.

Lessons learned from the drugs that failed:

Several drugs have failed to show beneficial effects in clinical trials in patients with NASH, even though they target relevant mechanistic pathways, nevertheless, they didn′t achieve significance on their primary outcome. Just to name a few, Simtuzumab did not benefit patients with either bridging fibrosis or compensated cirrhosis. Selonsertib was not superior to placebo in improving fibrosis in patients with both bridging fibrosis and cirrhosis. Furthermore, Elafibranor (PPAR agonist) missed its primary endpoint in phase III with only 19% of patients in the treatment arm achieving NASH resolution without worsening of fibrosis compared with 15% of patients in the placebo group.

So, How Big Is The Market Exactly?

Putting a monetary value on the NASH liver disease market is difficult and no report on the web can give you the best assumptions to understand it, from so many different angles.

Taking from someone with skin in the game, according to Marc Schneebaum, Madrigal's chief financial officer, the market for NASH liver disease therapy might be worth USD 50 billion. That is his most cautious estimate. He bases this on the cost of diabetic medications, which varies from $5,000 to $8,000 per patient each year.

Clinical trials / What′s coming

At the current time, there is no approved pharmacotherapy for NASH, and physicians have encouraged lifestyle modification, as weight loss in excess of 10% can lead to improved NASH outcomes and may reverse early-stage fibrosis in some patients. In May 2023, two companies led the race to commercialization:?Intercept Pharmaceuticals?and?Madrigal Pharmaceuticals.

However, in June 2023, Intercept dropped out of the race following the receipt of a complete response letter (CRL) from the FDA for obeticholic acid (OCA) as a treatment for NASH. Based on the content of the CRL, any resubmission of an NDA for OCA in NASH would require, at a minimum, successful completion of the long-term outcomes phase of the REGENERATE study. As a result, the company announced restructuring and the discontinuation of all NASH-related investments. Recall, this is the company’s second attempt for approval, following the receipt of its first CRL from the FDA in June 2020.

As such, Madrigal’s Resmetirom (selective thyroid hormone receptor-β agonist; THR-Beta agonist) will most likely be the first drug candidate approved for NASH in both the US and EU. For context, on 17 July 2023, the company announced the completion of its rolling submission of its New Drug Application (NDA) to the FDA for Resmetirom for the treatment of adults with NASH with liver fibrosis. Of note, Madrigal has also requested a priority review of the Resmetirom NDA.

With + 100 compounds and top pharma companies working on developing a new treatment, there are several promising compounds from different companies and MoA being developed in late-stage (figure 1).

Nevertheless, there are many other compounds in early and very early stages with promising results and different MoA.

In Figure 2, we can appreciate the distribution of molecules under development. Due to the huge amount of compounds being discarded due to no significant efficacy, only 5% (4) of the total number of NASH pipeline assets (84) are in Phase III development, with slightly more than 50% of these assets in the discovery, preclinical, and Phase I stages of development.

If we move on very early in discovery or maybe academia, we can find that AR-T therapy, traditionally associated with cancer treatment, could potentially be applied in advanced cirrhotic or fibrotic cases. One animal model study published in Nature in 2020 demonstrated promising results using CAR-T therapy to target senescent stellate cells, which produce fibrosis. Over time, this approach led to the resolution of scar tissue and improved liver chemistry tests.

5) Investments

We know that the market is suffering quite a meltdown these days and LPs seem to turn their backs on VCs, nevertheless, NASH is a disease that everybody wants to get their hands on. As mentioned before there are + 100 compounds in development and investors and pharma companies are eager to find the next treatment for NASH. Below you will find the most recent investment:

• Resalis Therapeutics Announces Seed Financing of €10 Million in 2023 to Fund Non-coding RNA-based Therapeutics for Metabolic Diseases - Claris Ventures, with participation from Italian Angels for Growth and Club degli Investitori.

• In 2022 Pfizer?made a $25 million equity investment?that will help support the development of its experimental pre-cirrhotic and cirrhotic nonalcoholic steatohepatitis therapeutic (NASH) drug in Akeros Therapeutics

• Terns Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company developing a portfolio of small-molecule single-agent and combination therapy candidates for the treatment of non-alcoholic steatohepatitis (NASH) and other chronic liver diseases, announced the closing of an $87 million Series C financing in 2021. The financing round was led by Deerfield Management Company alongside a strategic equity investment by Eli Lilly and Company with participation from OrbiMed Advisors, Lilly Asia Ventures, Vivo Capital, Samsara Capital, Suvretta Capital Management and several other new investors. Elise Wang, Partner at Deerfield, has joined the Terns Pharmaceuticals Board of Directors.

Assets:

1. ERN-101?(liver-directed non-bile acid farnesoid X receptor (FXR) agonist): top-line data from ongoing Phase 2a trial in approximately 96 NASH patients (LIFT Study) expected in the second half of 2021.
2. TERN-201?(highly-selective inhibitor of vascular adhesion protein (VAP)-1): expected initiation of Phase 1b NASH clinical trial in the first half of 2021, with top-line data expected in the first half of 2022.
3. TERN-501?(thyroid hormone receptor (THR) beta agonist with high metabolic stability, enhanced liver distribution and high THR-β selectivity): initiation of Phase 1 first-in-human clinical trial in the first half of 2021 with top-line data expected in the second half of 2021.

• In January 2020, Dutch NASH-focused biotech NorthSea Therapeutics raised $40 million in a Series B to progress its lead candidate icosabutate, a structurally-engineered fatty compound for NASH. Just shy of two years later, NorthSea has completed another round of financing, netting an $80 million Series C to start a Phase III in NASH and advance several other candidates.

• Glympse Bio?(Glympse), a biotechnology company advancing the way diseases are understood, tracked, and treated, closed an oversubscribed?$46.7 million?Series B financing in 2020. Temasek,?DNS Capital,?New Leaf Venture Partners,?Waterman Ventures, and?Catalio Capital Management, as well as existing investors, including?LS Polaris Innovation Fund,?ARCH Venture Partners,?CRV,?GreatPoint Ventures,?Gilead Sciences,

6) Agreements

The lack of FDA-approved therapies coupled with the emergence of research highlighting the benefits of combination treatments has continued to attract several big pharmaceutical and biotech companies (e.g.,?Gilead Sciences,?Novo Nordisk, Eli Lilly, and?AstraZeneca) to try their hand at developing a successful asset for NASH. While most assets have suffered the same fate as Intercept’s OCA, these attempts have fueled a certain degree of M&A and strategic alliance deal activity between 2018 and 2022

Some of the most prominent examples are:

• Novo Nordisk/Ventus license agreement for USD 70 million in advance with a potential total of USD 633 million + royalties for VENT-01 (NLR3, an inflammasome receptor).

• PathAI/GSK strategic multi-year partnership to accelerate scientific research and drug development programs in oncology and non-alcoholic steatohepatitis (NASH) by leveraging PathAI’s technologies in digital pathology including the use of PathAI’s AIM-NASH tool.

• HemoShear Therapeutics/Takeda agreed to use REVEAL-Tx?, a human disease modeling platform for drug discovery activities for a total of USD 470 million.

• GSK/Arrowhead agreement for $120 million upfront and over $900 million in milestones on Arrowhead’s RNA drug.

• Insitro/Gilead agreement for USD 15 million upfront and an additional USD 35 million based on milestones and up to low double-digit tiered royalties on net sales.

• Ionis/AstraZeneca for AZ6-2.5-LRx for USD 30 million upfront fees and a chance to pull in up to $300 million in milestones + low teens royalties if the products come to market.

7) Future perspective

To boost their chances of success in the NASH market, established businesses may attempt to create combination medicines that target various phases of NASH development. Notably, Novo Nordisk is currently developing semaglutide, a glucagon-like peptide-1 receptor agonist (GLP-1RA), as a monotherapy for patients with Stage F2/F3 NASH (NCT04822181), as well as a combination therapy for patients with Stage F4 NASH with cirrhosis (NCT04971785) in collaboration with Gilead Sciences. As a result, as the market gets more crowded and businesses are able to capitalize on clinical trial results, late-stage partnership activity is anticipated to increase.

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