Why Conatus Pharma Shares Were Halved

Conatus Pharmaceuticals Inc. (NASDAQ: CNAT) shares were more than halved on Thursday after the company announced top-line results from its midstage trial in cirrhosis patients at high risk of decompensation.

Specifically, the results came from the company’s Phase 2b Encore-PH clinical trial showing clinically meaningful treatment effects in compensated nonalcoholic steatohepatitis (NASH) cirrhosis patients.

The trial’s primary endpoint was change in mean hepatic venous pressure gradient (HVPG) from baseline to week 24 in any of three emricasan dosing groups compared with placebo. In the overall trial population, changes in HVPG from baseline to week 24 showed trends consistently favoring emricasan compared with placebo but ultimately did not meet the primary endpoint.

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Arun Sanyal, MBBS, M.D., Professor of Medicine, Physiology and Molecular Pathology at Virginia Commonwealth University School of Medicine, chair of the NIH NASH Clinical Research Network and chair of the Liver Forum, commented:

This trial evaluated the ability of emricasan to reduce HVPG in patients with cirrhosis due to NASH.  Although the primary endpoint was not met, the data indicates an amelioration of portal pressures by emricasan. Not surprisingly, those with the highest HVPG had the greatest benefit and the trends in all groups on sensitivity analyses favored active therapy. Together, these suggest that the findings are real and support additional investigation of this compound for those with compensated cirrhosis due to NASH and high HVPG, i.e., the population at greatest risk of clinical decompensation for whom there are no alternate approved therapies.

Shares of Conatus were last seen down 53% at $2.13, with a consensus analyst price target of $14.20. The stock has a 52-week trading range of $1.80 to $7.95.

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