On Friday, Conatus Pharmaceuticals (CNAT) presented two posters at the European Association for the Study of the Liver -- EASL -- conference. This conference took place at Amsterdam, and it is where all biotech companies developing drugs for liver disease go to present. The two posters presented came from a data analysis done by W. Ray Kim. M.D., professor of Medicine, and the lead author of the posters Ajitha Mannalithara, P.h.D, Engineering Research Associate. Both of whom worked at the Division of Gastroenterology and Hepatology. 

The two poster presentations were entitled as follows: 

Poster #1 : Poster #FRI-485 entitled, “Model for end stage liver disease [MELD] score dynamics in NASH [nonalcoholic steatohepatitis] patients awaiting liver transplantation and waitlist outcomes

Poster #2: poster #FRI-486 entitled “Model for end stage liver disease score dynamics in patients awaiting liver transplantation and waitlist outcomes

Both of these posters had data analyzed by the Organ Procurement and Transplantation Network. There were adults who were waiting on a transplant list on or after January 1, 2010. The second poster #486 dealt with patients with liver cirrhosis, hepatitis C, alcoholic liver disease etc.. The first poster #485 dealt with NASH cirrhosis patients.

What do both of these posters have to do with Conatus? It is quite simple really. In both of the posters patients who saw a decrease in MELD score by 2 points saw a 40% or better reduced rate of death/need for liver transplant. That exactly plays into Conatus because of prior results. In the ad hoc analysis by Conatus those liver cirrhosis patients that had a MELD score of > 15 after taking Emricasan  saw at least a -2.8 point reduction in MELD score. The translation here is that Conatus is set to start a phase 2b Liver Cirrhosis trial in the current Q2 2017. It will probably design its endpoint around this MELD score for a registration trial, but that will be revealed soon. 

All eyes are on Conatus starting this phase 2b liver cirrhosis trial because it is the main trigger for Novartis (NVS) to take the option to license Emricasan. It is a key catalyst for the quarter becomes if Novartis licenses the drug Emricasan from Conatus. For starters its opens the gate for the potential for Conatus to earn up to $650 million pending positive clinical, regulatory, and commercial milestones. Secondly, Novartis will be responsible for half of all phase 2b costs dealing with Emricasan along with paying in full all phase 3 trials. Finally, it gives Conatus the chance to earn double digit royalty sales on single agent Emricasan sales along with single digit royalty sales on combination products with Novartis' FXR agonist drug for NASH. 

Conatus is a good long-term investment as it has already proven its drug to work in preliminary Ad-hoc analysis. Liver cirrhosis patients taking Emricasan for 3 months that had a MELD score > 15 saw a p-value of p = 0.003.At month 6 Emricasan saw a -2.8 point MELD score reduction, which should be an improved p-value.  Meaning Emricasan achieved statistical significance in these patients after only 3 months of treatment compared to placebo. It is probably one of the major reasons why Novartis chose to make a deal with Conatus. 

Conatus has three trial readouts in 2018. One for HCV transplant patients with fibrosis, one with NASH fibrosis patients, and one with liver cirrhosis patients with hyper portal tension (veins in the liver that become constricted). All these 3 trial readouts in 2018 could make for a magnificent year. The company has even announced new targets that it has retained limited rights with Emricasan. It is thinking of adding to its pipeline heart disease, lung fibrosis, kidney disease, colorectal cancer, primary sclerosing cholangitis -- inflammation of the bile ducts in the liver, rare liver disease. More info on these targets are going to be provided in Q3 2017.