Shares of Conatus Pharmaceuticals (CNAT) tumbled as much as 40% Friday, closing the day at $6.19 per share. The company reported top line data on a phase 2 trial testing the drug Emricasan in patients with acute chronic liver failure — ACLF — and organ impairment. The drug showed an excellent reduction of key biomarkers in acute chronic liver failure but only at the highest dose tested of 50 milligrams. Emircasan also showed an excellent safety profile in all the patients in the trial, which is a good thing for these patients that are in very poor shape.
The company met with the independent Data Monitoring Committee –IDMC — to determine whether the trial should continue to completion. The IDMC declared that the safety data observed warranted the ability for Conatus to continue with the trial to completion. The company decided that it should terminate the trial early regardless, and this is what may have spooked investors into selling (and at least one analyst, who dropped his price target from $16 to $6). The reason the company states for stopping the trial early is that there were a lot of patients dropping out of the trial and it would become difficult to assess the data properly. Also, as expected, a lot of these patients were very ill so many died early in the study period.
There might be the ability for the company to explore Emircasan further in acute chronic liver failure at the highest dose possible if the company decides to go this route. That is because the company saw good biomarker data at the highest dose, and an excellent safety profile. Although this program has met some hardships early on it does not imply that it is necessarily done in terms of treating this patient population. A drug like this is needed for these patients because the hope is that Emircasan can keep these patients' livers functioning until new livers can be found for transplant.
Conatus states that it is awaiting results from its other trials testing Emircasan in other liver diseases which may show the company the path forward for this latest trial. Primarily the company has another potential catalyst in a big indication known as NASH — non-alcoholic steatohepatitis. As the name implies, NASH is a fatty liver disease not developed through the use of excessive alcohol. The company may have a chance to redeem itself with these results in NASH due out in Q1 2015.
