Visit Intercept Pharmaceuticals'(ICPT) website on the liver disease known as NASH and you might come away thinking that your liver is about to kill you.
"HOW CLOSE ARE YOUR PATIENTS TO THE TIPPING POINT?" the website asks in all caps, with an illustration featuring boulders that spell the word "cirrhosis" bouncing off a cliff.
Getting doctors and patients to worry about NASH -- nonalcoholic Steatohepatitis -- is important for the pharmaceutical industry. Drug developers are all-in on the little-known, newly defined disease, which afflicts a large swath of the adult population in Western countries, but which few sufferers will notice over the course of their lifetimes.
Big and small drug companies are piling on. About 72 different drugs are in the pipeline to treat the disease, says Pasha Sarraf, an analyst with SVB Leerink, and many more are in the early stage. Companies like Novartis (NVS), Intercept Pharmaceuticals(ICPT) , Gilead Sciences(GILD) , Novo Nordisk(NVO) , Eli Lilly(LLY) , and Alnylam Pharmaceuticals(ALNY) are all contenders.
Investors, however, should view that pipeline with skepticism. Though analysts agree that Intercept will have significant sales if its drug hits the market first, as expected sometime next year, there is growing uncertainty around the long-term hopes for the field.
"NASH involves huge patient numbers and real unmet need, but until the diagnostic pathway improves and higher impact therapies enter the pipeline, I think it's going to be a tough business for pharma to build, " says Marc Elia, the founder of M28 Capital Management, an investment firm focusing on biotechnology that is launching early next year.
In lay terms, NASH describes a very, very fatty liver. In more advanced stages, patients experience scarring on their liver, known as fibrosis, which can lead to deadly conditions like liver cancer or decompensated cirrhosis.
That sounds bad, and it can be. But even if you have a serious case of it, NASH likely won't be the thing that kills you. NASH does not seem to cause symptoms before its terminal phases, and in most patients, it can take years, and even decades, to pass through all the phases of the disease.
By that point, people suffering from NASH are more likely to die of a heart ailment. NASH patients often suffer from obesity and Type 2 diabetes. According to a simulation tool developed by researchers at Massachusetts General Hospital and Harvard Medical School, a 60-year-old male patient with the most significantly progressed form of NASH has only a 16% chance of dying from liver-related diseases within 10 years, and a 40% chance of dying from a heart condition.
And treatment poses challenges. Among other things, the only way to diagnose NASH currently is through a liver biopsy, an expensive and potentially dangerous procedure.
Still, physicians are eager for tools to treat the disease, particularly in its advanced stages, and companies are eager to fill the need.
"There is nothing available to treat the liver" in NASH patients, says Intercept CEO Mark Pruzanski. "We believe that there's an unequivocal unmet need for antifibrotic therapy in patients with advanced fibrosis."
Intercept's senior vice president for medical affairs, Gail Cawkwell, stands by the imagery on the company's " tipping point" website for health-care professionals. "Patients may be going along, walking on that edge of the cliff, but not know that they're there," she says. "Once you develop cirrhosis, there's a point where that cirrhosis is so advanced that there's little functional liver left, and...there's few options for the patient."
The rush for NASH treatments followed Gilead's success with Harvoni, a treatment for another liver ailment, hepatitis C. In 2015, Gilead sold $13.9 billion worth of Harvoni. As patients were cured, sales dropped, and Gilead is expected to sell $674 million worth of Harvoni this year.
Some of the push for NASH drugs comes from hepatologists worried about the growing impact of obesity, Sarraf of SVB Leerink says. But, he adds, there is also "an opportunistic force that's riding this."
At a time when much of drug development is focused on extraordinarily expensive drugs for extraordinarily rare diseases, NASH offers the benefit of affecting up to 6.5% of adults worldwide, according to one 2016 study that looked back at previous research.
And since NASH isn't caused by a virus like hepatitis C, it would likely need to be treated chronically over a lifetime.
Investor enthusiasm over NASH has cooled a bit, particularly after Gilead's lead entry in the NASH race, selonsertib, failed in two Phase 3 trials earlier this year. In December, Gilead announced that a Phase 2 study of combination therapies targeting NASH had also failed to reach its primary endpoint.
Still, big players remain in the game.
"People want to be there on the hope that this will be a very big market, " says Ronny Gal, an analyst with Bernstein.
Some scientists, however, worry that the commercial windfall of the hepatitis C drugs has led to an approach to NASH that underestimates the disease's complexity. "They were sort of bewitched by the success, the enormous commercial success, for the companies," says Ian Rowe, a hepatologist and a university academic fellow at the University of Leeds. NASH is "much, much more complicated."
The NASH treatment scheduled to reach the market first is Intercept's obeticholic acid. The company submitted the drug for Food and Drug Administration approval in September, and the agency has granted the application priority review status. The FDA is expected to make a decision by March, and analysts expect sales of obeticholic acid in NASH to hit $ 770 million by 2023.
But data from a Phase 3 study suggests that the impact of obeticholic acid on the disease may be incremental. Intercept based its FDA application on interim data from a study that found that liver scarring, or fibrosis, improved, and other NASH parameters did not worsen, in just 23.1% of patients who took the higher dose of the drug, compared with 11.9% of patients who took a placebo.
Intercept says that figure understates the drug's efficacy. Pruzanski, the CEO, says that the most important metric was stabilization of fibrosis, and that four in 10 of the patients on the high dose improved by a full stage of fibrosis, the unit by which the scarring is measured, while just one in 10 worsened by a stage.
Obeticholic acid also raises levels of so-called "bad cholesterol," a potential concern for the likely patient population, which is prone to heart disease. Intercept's Cawkwell says the risk could be managed with other cholesterol- lowering medication.
Shares of Intercept are up 95% since Sept. 27, when the company announced it was filing its application for approval of obeticholic acid with the FDA. The S&P 500 is up 8.3% over the same period.
Analysts say that there is a significant group of patients already diagnosed and waiting for a NASH drug, and that insurance companies will have a hard time denying coverage.
"People think it's the front-runner," SVB Leerink's Sarraf says of Intercept's drug. "If they price it appropriately, if they can execute commercially, they have no competition."
Yet beyond that first group of patients, the future begins to get hazy. In a note in April, Bernstein's Gal estimated that the entire market for NASH drugs will be just $5 billion by 2030, and that Intercept's obeticholic acid will quickly lose market share. By 2025, he projects it to hold just 9% of the market.
Other drugs in the pipeline include Elafibranor from Genfit, which would be the second drug to hit the market. Novo Nordisk(NVO) and Eli Lilly(LLY) each have similar drugs in Phase 2 NASH trials, called semaglutide and tirzepatide, respectively. The GLP-1 class of drugs were originally developed for diabetes.
Even as the companies prepare to release these drugs on the market, the science on the disease remains a moving target.
"It's definitely causing cases of end-stage liver disease and liver cancer," says Rowe of the University of Leeds. "But the optimal approach of treating it is much more difficult to know, and ultimately the vast majority of people who've got [fatty liver and NASH] will not die of liver disease."
Rowe published a study this fall arguing that the benefits of treating NASH in patients who have yet to develop cirrhosis is "predicted to be limited."
If Rowe is right, that could mean that the GLP-1 drugs may be more useful in the long-term than the drugs arriving on the market sooner.
None of this has discouraged the drugmakers. Nor has the difficulty of identifying patients, or diagnosing the disease, or keeping the patients on the drug long-term.
The drugmakers say that they expect more diagnostics to hit the market, and that the insurance companies won't require biopsies to pay for the drugs.
Given the challenges in identifying NASH patients, some of the success of the NASH compounds will rely on marketing campaigns. Some of that work, including Intercept's, has already begun.
"I'm a commercial guy," says Pascal Prigent, CEO of Genfit, which has a NASH drug in Phase 3 trials. "Most of those consumers... they don't even know they're sick. So how you drive them to seek treatment and all of that? It's a cool marketing challenge."
Write to Josh Nathan-Kazis at firstname.lastname@example.org
(END) Dow Jones Newswires 12-26-190459ET Copyright (c) 2019 Dow Jones & Company, Inc.