RE:RE:RE:RE:RE:RE:RE:RE:NASH in the ATM ProspectusThis board is falling back in palaver mode. We all know that in official papers like a propectus or annual information form they will always put all the possible risks. It is a legal obligation for them to do so to avoid any future lawsuit.
To me this partnership thing in NASH is quite sudden and looks like a way to buy time. A way for Levesque, who painted himself in a corner on the start of phase III, to walk on the paint to get out of this bad position. In other words, it is a way to regain freedom in his decision process. I am not saying the partnership process is not real, but between searching for a possible partner and stricking a deal, there is a big difference. That being said, maybe he will find a deal too good to resist.
But now he has all his options open and to me, the ATM was put in place in order to benefit from potential great news in oncology. Levesque in the last chat said the delaying the start of the phase III by three months would not be dramatic. The thing is that in three months they will know for sure what is going on in oncology. If they can come out with a really great news, the stock price will rise significantly and they will be able to bring in cash, add to that the warrants from the last financing will be exercized. So if that happen, they will have the money to push oncology, and maybe go alone in NASH, knowing they have an early way out of the trial if it's not good enough after 400 patients. This clause has been negociated as a risk mitigating tool. The agencies asked for a larger cohort than expected, but the company got a possible exit point. The problem with the NASH phase III has always been the cost coupled with the low stock price. I think they have early efficacy data in oncology right now and they hope it will further improve in the next two months and lead to a higher stock price by the end of phase Ia and the public release of the results.
Levesque is now using what I would call a tactical tool (i.e. exploring partnership), but his strategy is quite the same. Only a very appealing partnership offer would change the strategy of the company. So it's the old military tactic of gaining time to be stronger when the real action will begin.
SPCEO1 wrote: While the phase III is thought to be a registrational trial, the language in the prospectus held out the possibility that the FDA could require a second phase III trial. So, that is a huge risk and I am sure it is something the potential partners are thinking a lot about. Clearly, the need for a second phase III would come about only if the data from the first phase III left room for doubt about the drug's efficacy. But the propsectus language also referred to the need for the first phase III's results to be perhaps better than others since they skipped the phase IIb step? Again, something for the potential partners (and us) to be concerned about.
It is amazing what the compamy has pulled off but it still has some hair on it as a result of how they got here. But if they can show some good results with those first 400 patients, everything should get much easier from that point forward.
qwerty22 wrote: A registrational NASH trial is their goal, it's still alive and they should pursue every possibility of making that happen. They should exhaust all possibilities. More time devoted to that in any way possible is time well spent. The reward is massive. A partnership with a serious Pharma that takes the financial burden would be the most valuable outcome and they should pursue this for sure.
All I'm saying is the fall back position is an exploratory trial. In no way is that a terrible outcome either.
SPCEO1 wrote: The 400 patient interim readout is effectively the phase IIb you and others are looking for. Because of its size, it is longer and more expensive than a standard phase IIb as you and others point out. But, if the drug works, and I am pretty sure TH has a high degree of confidence it will, then the phase III protocol is the best option as its present value would be highest due to getting to market sooner. Getting to market sooner may be critical to the ultimate success of the drug.
Now, we know TH has said they do not have the resources to market Egrifta in NASH and have talked about only marketing to the key centers of NASH excellence and leaving the broader market to the thousands upon thousands of other doctors to a partner. It seems to me that one good option for TH would be to fund the 400 patients themselves and then work out a partnership agreement to provide the funds to finish the trial (if the 400 have good enough data) and market the drug beyond the NASH centers of excellence. Clearly, if they have good data for the 400 patients, the partnership deal they can arrange could be quite attractive. In the best of all worlds, this would be the alternative we shareholders should desire as it would likely be the one that maximizes profits for TH.
I wonder if the KOL event is essentially an attempt to set something like that up for investors. They would still need to raise some additional money so that may be the reason for the KOL sales pitch. Also, if they wait a few months to kick the trial off, they may have the cancer data out by then which could cause the stock to rise considerably and make any fundraising much more palatable.
qwerty22 wrote: This is a big reveal that the fda prefer one more exploratory trial. It's worth it to just keep parsing this until we understand.
What I think this says is based on their principles of keeping patients safe, avoiding futility, timely drug development the fda think both a Ph3 with non-futility interim readout OR a Ph2 both work (for their principals) but their preference (or recommendation) is to go with Ph2.
In effect what the company is doing now is fully exhausting the feasibility of that Ph3 route. It has pros - shorter time frame and cheaper overall costs to approval and it has cons - likely a more expensive and maybe longer route to that non-futility readout than if they did a stand alone Ph2b. If your concern was to get to non-futility fastest and cheapest you might pick a Ph2 next. If your priority was to get to approval fastest and cheapest you'd take Ph3. That seems to be the dilemma (or opportunities) crudely stated. It's clearly a challenging problem for thtx with its level of resources to pick the Ph3 route atm but maybe you get a different viewing of the issue with a pharma and it's resources.
They state not going forward with NASH as the worst possible outcome but I think there are a number of barriers to cross before they get there. The first one was can they start the Ph3 on their own, that one they failed. The next test is to see if they can go Ph3 with a partner (likely taking most of the financial burden). If that one succeeds then great, if it fails then they move on. Third, have circumstances changed that go-it-alone Ph3 looks viable, let's say unlikely in 6-12 months. Does go-it-alone Ph2 work? Does a partnered Ph2 work? I think all these alternatives need to be considered before they decide to pull the plug on NASH. Maybe they have to say not progressing is a possibility in their risk section but given everything they have, and the many different ways they can proceed it seems unlikely to me. Remember if they choose a Ph2b trial that would put them firmly on the same path as all other mid/late stage programs except they'd have an added bonus of this golden ticket in their pocket that says the fda already think they a registrationally ready.
The next months are the final assessment of the viability of the Ph3 path. If that fails the next assessment should be the best way to run a final exploratory trial, with or without a partner. In my view that should work giving everything they have and not proceeding with NASH while possible shouldn't ever get reached. For my investment purposes I'm still thinking 2b is the worst likely outcome. Having Ph3 as a viable option has always been something of a golden egg, the success so far has been to keep that on the table. While it's on the table it has a possibility of actually happening, once they exhaust that possibility things really should shift to the viability of Ph2b, all stakeholder should see that as far less problematic.
Wino115 wrote: It's starting to make some sense. If you look at the trial up to the futility checkpoint, it's basically a robust 2b but with twice the normal cohort (I'm guessing a bit from recalling some P2b sizes). The difference is that it would all count toward the P3 endpoint registration of the drug. That's worth something valuable if it goes the right way. Otherwise, it was more costly.
qwerty22 wrote: We are reading that differently, I think it means the FDA's preference was for a Ph2b in general NASH.
I think the FDA's priorities are to ensure patient risks are minimized, that patients aren't exposed to futile trials and that drugs get developed in a timely fashion. I think they see that this could be achieved with the present protocol thtx have laid out, where the interim data minimizes the number of patients exposed to biopsy in a potentially futile trial OR alternatively the drug goes through one more exploratory trial. Both work for the fda but I guess their recommendation was do the Ph2 first.
I think the company getting the option for Ph3 gives them something important to show a partner. It shows that on many fronts the drug is ready for a registrational trial. It's ticked all the boxes except one, non-futility. That is an important card to play in negotiations. In essence it tells a partner if they invest in the next stage of development then all the risk is on the biopsy outcome, everything else has been shown to pass the regulators. I like they complete the Ph3 talks because of that even if it doesn't end with the next trial being Ph3. Assuming a partner wants to do a Ph2b it gives them a sneak peek into what the future looks like if they can hit those biopsy endpoints, that's not what other Ph2 companies can provide.
juniper88 wrote: If not the FDA then who convinced Thera to go for General rather than HIV NASH? And why?
SPCEO1 wrote: Below are the paragraphs realted to NASH in the ATM prospectus. Someone may have already posted this, but in case not, here it is again. Qwerty will feel good about the part that says the FDA really did want them to do a phase II trial first. The company has indicated that the FDA will seemingly hold their phase III trial results to a somewhat higher standard since agreed to wave the phase II requirement. The language in the risk section of any prospectus is meant to present the worst case scenario, so read the below with that in mind but there are some interesting tidbits in it. You can see why finding a partner on attractive terms may be a challenge. Accordingly, I have to think that has been the early experience and TH is now rebooting in hope of boosting the share price via the KOL meeting so they can pursue NASH on their own via new money raised with the ATM. Alternatively, perhaps the KOL event is meant to encourage potential partners as well. If they are able to drag there NASH effort over the finish line by either finalizing a nice partnership or going it alone after a fund raising, then it will be an amazing achievement. It is amazing they got it this far but they have to "stick the landing" to make it all worthwhile. In light of all this, what we will learn at the KOL meeting takes on added significance. If that event is a flop, it is possible TH might just have to give up on NASH. I sure hope they are working overtime to make sure investors who can make a difference to the stock are at the KOL event. While most of us are here for cancer now, if they can pull this off and give us some value for NASH to, it would be stunning. I believe they can do that but they ahve to execute on selling to investors like they never have before.
Here is the language from the prospectus with some highlights in red from me:
Risks Related to the Phase 3 Clinical Trial Evaluating Tesamorelin for the Treatment of NASH in the General Population
The conduct of the Phase 3 clinical trial evaluating tesamorelin for the treatment of NASH in the general population will be costly and the Corporation has decided to secure additional resources, including finding a partner, prior to initiating such clinical trial, all of which will result in a postponement of the initiation of such trial. If tAlthough the Corporation has begun the search for a potential partner, there can be no assurance that a partner will be found or that a partnership agreement will be entered into on terms satisfactory to the Corporation. If a partner is not found, the Corporation will need to look for alternatives to secure additional resources but there can be no guarantee that the Corporation will secure such resources in an amount sufficient to initiate its Phase 3 clinical trial. Moreover, the Corporation has no meaningful Phase 2 clinical data evaluating tesamorelin for the treatment of NASH in the general population and any results obtained from the conduct of one Phase 3 clinical trial will have to show substantial evidence that tesamorelin is safe and effective for the treatment of NASH in the general population. Finally, the Corporation’s decision to design its Phase 3 clinical trial to meet the FDA’s primary endpoint may prevent the Corporation from seeking approval of tesamorelin for the treatment of NASH in the general population from the EMA since the primary endpoint for this agency is different from that of the FDA.If the Corporation is unable to secure additional resources to initiate its Phase 3 clinical trial, the conduct of such trial could be cancelled. Moreover, if the Corporation is unable to meet the endpoints of its Phase 3 clinical trial or does not receive approval for tesamorelin for the treatment of NASH in the general population, its potential long-term revenues, growth and prospects will be materially adversely affected.
The Corporation has recently held discussions with the FDA and the EMA to finalize its Phase 3 clinical trial design. As a result of such meetings, the trial design will result in higher costs than what the Corporation had previously estimated. The Corporation has decided to postpone the initiation of its Phase 3 clinical trial evaluating tesamorelin for the treatment of NASH in the general population until it can secure additional resources to execute its program and has initiated a search to find a partner for that purpose.
There can be no guarantee that the Corporation will be able to initiate its Phase 3 clinical trial evaluating tesamorelin for the treatment of NASH if it is unable to secure substantial additional resources, either from this Offering, a partnership or other means that it could resort to. In addition, the Corporation may not be able to find a partner to help with securing additional resources. Even if the Corporation finds a partner, the terms and conditions pursuant to which such partner may be interested in assisting the Corporation may not be suitable to the Corporation or may be unfavorable. Under such circumstances, the Corporation may decide to forego the search of a partner and turn to alternative sources of financing. If the Corporation is unable to secure additional resources, it may further postpone the initiation of its Phase 3 clinical trial until it can secure additional resources or may cancel its Phase 3 clinical trial evaluating tesamorelin for the treatment of NASH in the general population. If the Corporation is unable to, or does not proceed with, the development of tesamorelin for the treatment of NASH in the general population, it could have a material adverse effect on its potential long-term revenues, growth and prospects.
Even if the Corporation secures additional resources to initiate its Phase 3 clinical trial, there can be no guarantee that the FDA will approve tesamorelin for the treatment of NASH in the general population since the FDA recommended the Corporation to conduct a Phase 2 clinical trial to generate data resulting from the use of tesamorelin in patients suffering from NASH and since the Corporation must meet the primary endpoints set forth by the FDA in its guidelines. Given the lack of Phase 2 data resulting from the use of tesamorelin in patients suffering from NASH, the data from the Phase 3 clinical trial will have to demonstrate substantial evidence of the safety and effectiveness of tesamorelin for the treatment of NASH in the general population. In addition, even if the Corporation meets the primary endpoints of the clinical trial through the conduct of one Phase 3 clinical trial, the FDA could require the Corporation to conduct an additional study.
The Corporation has decided to design its Phase 3 clinical trial based on the FDA guidelines requiring it to demonstrate “NASH resolution and no worsening of fibrosis” as primary endpoints. This trial design does not follow the current EMA guidelines which require a sponsor to demonstrate both (i) NASH resolution and no worsening of fibrosis and (ii) improvement of fibrosis by one stage without worsening of NASH as primary endpoints. Therefore, even if the Corporation meets the primary endpoints for FDA purposes, the EMA may not approve tesamorelin for the treatment of NASH in this territory since the trial was not designed to demonstrate both endpoints.
If the Corporation is unable to obtain approval of tesamorelin for the treatment of NASH in the United States, this would have material adverse effects on its revenues, financial results and long-term growth and prospects. In addition, even if the FDA approves tesamorelin for the treatment of NASH, the lack of an approval in Europe will limit the Corporation’s ability to maximize its revenue growth potential, therefore potentially hampering its long-term growth and prospects.