On September 20, 2023 GENFIT (Nasdaq and Euronext: GNFT), a late-stage biopharmaceutical company dedicated to improving the lives of patients with rare and severe liver diseases, reported its first half-year 2023 financial results and provided a corporate update (Press release, Genfit, SEP 20, 2023, https://ir.genfit.com/news-releases/news-release-details/genfit-reports-first-half-year-2023-financial-results-and [SID1234635278]).
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Pascal Prigent, CEO of GENFIT, commented :
"The positive interim results of our ELATIVE Phase 3 study in PBC means that GENFIT is now entering into a new era, as we pivot from a focus on a single program to the development of a robust portfolio of exciting programs. Additional ELATIVE data will be released in the coming months, and we are confident that this data will further demonstrate that elafibranor has a very competitive profile and the potential to add significant value to patients with PBC. We are pleased to see the commitment of our partner Ipsen and believe that they will make the most of the opportunity. For GENFIT, this means a potential first milestone in 2023 and, if elafibranor is approved in PBC, additional milestones and a regular revenue stream of royalty payments. These potential revenues would be used to finance the development of a very exciting pipeline of seven different programs ranging from preclinical to Phase 2. In particular we have five distinct programs in ACLF where the medical need is significant."
GENFIT will host a conference call in English on September 20, 2023 at 4.15pm EDT | 9.15pm GMT | 10.15pm CET
The conference call will be accessible on the investor page of our website, under the Events section at: https://ir.genfit.com/events%26presentations/events or by calling 888-204-4368 (toll-free United States/Canada), 0800 279 0425 (toll-free United Kingdom), 0805 101 219 (toll-free France) five minutes prior to the start time (confirmation code: 1615622). A transcript of the conference call will be made available in French on the investor page of the GENFIT website soon after the call.
I. 1H23 Business highlights1
PBC: positive results from pivotal Phase 3 ELATIVE trial
GENFIT and Ipsen announced positive interim topline data from the pivotal ELATIVE Phase 3 trial of elafibranor in PBC in the second quarter of 2023. The trial met its primary endpoint, with a statistically significant higher percentage of patients achieving a clinically meaningful cholestasis response compared to patients who received placebo. 51% of patients on elafibranor 80mg achieved a cholestasis response compared with 4% on placebo (p<0.0001). The first key secondary endpoint, normalization of ALP at Week 52, was also met with statistically significant improvements for investigational elafibranor compared with placebo. For the other key secondary endpoint, a trend for pruritus improvement was observed with a greater decrease from baseline in the PBC Worst Itch Numeric Rating Scale score for patients on elafibranor compared to placebo, which did not reach statistical significance. In the study, elafibranor was generally well tolerated with a safety profile consistent with that observed in previously reported studies.
ACLF franchise2
GENFIT’s Acute on Chronic Liver Failure (ACLF) franchise now comprises 5 assets (VS-01, NTZ, SRT-015, CLM-022, VS-02-HE) based on differentiated mechanisms of action leveraging complementary pathways.
VS-01-ACLF: First patient randomized in the Phase 2 trial
VS-01 is currently being evaluated in the international UNVEIL-IT Phase 2, open-label, randomized, controlled, multi-center, proof of concept study to assess its efficacy, safety, and tolerability in addition to standard of care (SOC), compared to SOC alone, in adult patients with ACLF grades 1 and 2 and ascites.
The Investigational New Drug (IND) was in effect as of April 17, 2023, and the first patient was randomized in the Phase 2 trial in early July. The trial is expected to enroll approximately 60 adult patients with ACLF grades 1 and 2. Patients will be randomized in a 1:1 ratio to receive either daily intraperitoneal administration of VS-01 over 4 days on top of SOC (active treatment group) or SOC alone (control group).
NTZ in ACLF: Phase 1 clinical data presented at DDW
Data presented in May 2023 at Digestive Disease Week (DDW) showed that nitazoxanide (NTZ) was generally safe and well tolerated in subjects with moderate and severe hepatic impairment. Preliminary data from a similar Phase 1 study also showed that NTZ was well tolerated with a favorable safety profile in subjects with renal impairment.
Following engagement with the U.S Food and Drug Administration (FDA), and on the basis of the preclinical work and phase 1 data confirming the potential of NTZ in ACLF, GENFIT has decided to pursue the development of a new nitazoxanide formulation, which will permit greater dosing flexibility.
ASK1 Inhibitor SRT-015 in acute liver disease
In May 2023, GENFIT licensed the exclusive worldwide rights of ASK1 Inhibitor SRT-015 (injectable formulation in acute liver disease) from Seal Rock Therapeutics, a Seattle, Washington (USA) based clinical stage company developing potential first-in-class and best-in-class kinase inhibitors.
Preclinical and clinical evidence support ASK1 inhibition as a relevant therapeutic strategy in multi-system disorders such as ACLF. ASK1 inhibition has shown several potentially beneficial effects that may be relevant in ACLF, such as blocking LPS (lipopolysaccharide) associated hyperinflammatory response, reducing the ROS (Reactive Oxygen Species)-related immune response, reducing apoptosis, reducing release of the proinflammatory cytokines, reducing fibrosis, and protecting macrophage mitochondrial function. Multi-organ benefits have been observed in several animal models and clinical trials.
Under the terms of the agreement, Seal Rock Therapeutics is eligible for payments of up to €100 million, including regulatory, clinical, and commercial milestone payments, plus tiered royalties. This agreement does not have any material impact on our current financial forecast, as specified in Part III of this press release.
CLM-022 in liver disease treatment
In July 2023, GENFIT licensed the exclusive worldwide rights of CLM-022, a potential first-in-class inflammasome inhibitor, from Celloram Inc., a Cleveland, Ohio (USA) based biotechnology company. GENFIT will leverage Celloram’s acquired scientific insights on this molecule to finalize IND enabling studies of this preclinical stage asset and secure an IND for future clinical trials.
Under the terms of the agreement, Celloram is eligible for payments of up to €160 million, including regulatory, clinical and commercial milestones, as well as tiered royalties. This agreement does not have any material impact on our current financial forecast, as specified in Part III of this press release.
VS-02 in HE
VS-02-HE is in preclinical stages and is being developed in Hepatic Encephalopathy (HE), which is one of the major complications of advanced liver disease and portal hypertension. As many as 45% of patients with cirrhosis will experience at least one episode of HE. VS-02-HE is a urease inhibitor, designed to inhibit ureases by binding to nickel atoms in their active site.
CCA
CCA: Phase 1b/2a study evaluating GNS561
The first patient is expected to be screened in the second half of 2023 in a Phase 1b/2a study evaluating GNS561 in patients with KRAS mutated cholangiocarcinoma (CCA).
In the Phase 1b, patients are enrolled to evaluate the safety and tolerability of GNS561 when given in combination with a MEK inhibitor, and to identify the recommended doses of the combination to be administered in the Phase 2a study.
UCD and OA
GENFIT is also pursuing the development of preclinical programs in Urea Cycle Disorders (UCD) and Organic Acidemias (OA).
VS-01-HAC
VS-01-HAC is a potential first-line lifesaving treatment for acute hyperammonemic crisis associated with Inborn Errors of Metabolism in UCD and OA.
NASH diagnostic
In May 2023, the Journal of Hepatology published a manuscript on the development and validation of NIS2+, followed by an article in August 2023 on NIS2+ ‘s performance in older patients in Hepatology Communications.
At the EASL3 Congress 2023, GENFIT presented NIS2+ as an effective screening tool for optimizing patient selection in clinical trials targeting NASH4 and as the most adapted Non-Invasive Test (NIT) for an efficient identification of at-risk NASH that is not impacted by age.
Corporate governance updates
At the Company’s Annual Shareholders’ Meeting held on May 24, 2023, all of the resolutions endorsed by the Board of Directors were adopted by a significant majority of the votes cast. This includes the renewal of financial authorizations that would allow the Company flexibility to seize relevant market opportunities.
In June 2023, Sandra Silvestri, M.D., Ph.D., replaced Steven Hildemann M.D., Ph.D., on the Board of Directors of the Company as representative of IPSEN, the legal entity that holds the board seat. Sandra Silvestri, M.D., Ph.D., joined Ipsen in 2023 as Executive Vice President, Chief Medical Officer and Head of Global Medical Affairs, Patient Safety and Patient Affairs.
In the first half of 2023, Sakina Sayah Jeanne and Tom Huijbers joined GENFIT’s Executive Committee, respectively as Executive Vice-President Research & Translational Science and Executive Vice-President Regulatory.
ESG commitment
GENFIT’s ESG commitment and performance were recognized by independent stakeholders.
In July 2023, GENFIT was awarded a gold medal by Ethifinance (compared to bronze in 2022) and ranked 2 out of 75 companies in the biopharmaceutical sector. This upgrade in the ratings is a testament to a company-wide effort in implementing CSR initiatives and ensuring transparent communications in relation to our CSR approach.
In June 2023, GENFIT was classified by ODDO Research as "Best-in-Class" in its sector, based on two main criteria: activity impact and ESG maturity.
In January 2023, GENFIT obtained a "Prime status" label by ISS ESG, upgrading its corporate rating from C to C+.
In the second half of 2023, GENFIT will continue to reaffirm its commitment to social/societal responsibility and sustainable development.
II. 2H23 and beyond: key milestones and outlook
PBC
Additional data on the ELATIVE study is expected to be disclosed by Ipsen at an upcoming scientific conference.
Ipsen is responsible for the development and commercialization of elafibranor, including the submission of regulatory applications for elafibranor following discussions with the FDA and the European Medicines Agency.
ACLF franchise
VS-01-ACLF: Interim data expected to be available in 1H24
Interim data are expected to be available in the first half of 2024 with the objective of supporting preparation of further testing of efficacy. Given the high unmet need in this indication and the Orphan Drug Designation obtained from the FDA for VS-01, it is expected that the program may qualify for some of the expedited regulatory pathways provided by health authorities.
NTZ in ACLF: Phase 2 clinical trial launch expected in 1H25
Subject to the successful development of a new nitazoxanide formulation, we have revised the expected launch date of a Phase 2 clinical trial to the first half of 2025.
ASK1 Inhibitor SRT-015 in acute liver disease: First-in-Human study planned in 2H24
A First-in-Human study is planned in the second half of 2024 to support a Proof-of-Concept study in ACLF patients as early as 2025.
VS-02-HE
IND enabling nonclinical studies are targeted to be completed in 2025.
CLM-022 in liver disease treatment
A preclinical proof-of-concept study is targeted for 2024.
CCA
GNS561 in CCA: First biomarker data targeted for 1H24
The first patient is expected to be screened in the second half of 2023.
The first biomarker data are expected to be available as early as the first half of 2024 and should support preparation of further evaluation of efficacy with the optimal doses of GNS561 and a MEK inhibitor in Phase 2a of the study.
Given the high unmet need in this indication and the Orphan Drug Designation obtained from the FDA for GNS561, it is expected that the program may qualify for some of the expedited regulatory pathways provided by health authorities.
UCD and OA
IND enabling nonclinical studies are targeted to be completed in 2024 for UCD and OA.
NIS2+ in NASH
GENFIT continues to explore the possibility of obtaining regulatory approval and CE Certificates of Conformity, with a development and commercial partner, to release an IVD test powered by NIS2+ technology on the US and European markets.
In the second half of 2023, GENFIT will continue to publish data in scientific publications and at scientific events on NIS2+.
III. 1H23 Financial highlights
Cash, cash equivalents and other current financial assets
As of June 30, 2023, GENFIT had €111.8 million in cash, cash equivalents and other current financial assets compared with €140.2 million as of December 31, 2022. We expect that our existing cash, cash equivalents and current financial assets will enable us to fund our operating expenses and capital expenditure requirements until approximately the fourth quarter of 2024. This is based on current assumptions and without taking exceptional events into account, as well as potential milestones and royalties that the Company may receive pursuant to the licensing agreement with Ipsen.
In the first half of 2023, these cash flows are mainly the result of our research and development efforts, notably for ELATIVE, our Phase 3 clinical trial of elafibranor in PBC; UNVEIL-IT, our Phase 2 clinical trial of VS-01 in ACLF; GNS561, as part of our cholangiocarcinoma program; and NTZ, as part of our ACLF program.
Revenues and other income
Revenues and other income amounted to €15.4 million in the first half of 2023 (compared with €12.2 million in the first half of 2022).
Substantially, all revenue is attributable to our Collaboration and License Agreement with Ipsen and related Transition Services Agreement. Revenue growth reflects certain services billed to Ipsen under the Transition Services Agreement, originally entered into in the first half of 2022.
Operating expenses
Operating expenses amounted to €34.7 million in the first half of 2023 (compared with €26.5 million in the first half of 2022).
Substantially, all of the increase in operating expenses is due to research and development expenses, which amounted to €25.6 million in the six months to June 30, 2023, compared with €17.6 million in the six months to June 30, 2022. Specifically, there has been an increase in:
Contracting costs which amounted to €14.4 million in the first half of 2023 compared with €8.5 million in the first half of 2022, reflecting increased activities across multiple product candidates, including ELATIVE, VS-01, GNS561 and NTZ,
Employee expenses which amounted to €6.3 million in the first half of 2023 compared with €4.9 million in the first half of 2022, reflecting increased headcount, and
Other expenses (maintenance, fees, travel and other taxes) which amounted to €3.3 million in the first half of 2023 compared with €2.4 million in the first half of 2022, reflecting increased activity overall, as previously noted.
Financial results
Financial income in the first half of 2023 was a loss of €1.1 million, compared to a gain of €4.0 million in the first half of 2022.
The change in financial results is mainly due to foreign exchange gains in 2022 which did not repeat in 2023, partially offset by increased interest income in 2023 relative to 2022.