NASH Market- Since LLY released Retatrutide phase 2 results June 26th showing not only possible weight loss promise, but also Liver fat reduction, the loss in Market cap for companies having lead NASH compounds has been pronounced:
The loss of Market cap for the above companies was $5,164,930,000 or approx. 53% of their total market value since the retatrutide announcement was made only 3 months ago. I should note that Akero released some mixed trial results released Oct. 10 that showed while effective for Liver fat, their drug wasn't as good as hoped for fibrosis management making it (and by way of association ENTB) more or less somewhat equal to MDGL's resmetirom. (See #msg-172995492) enabling their market caps declines to "catch up to others". (I should also note that the NASH market has been heavily shorted for some time predating the retatrutide announcement but will comment on the possible reasons/justification for that in a separate post in a follow-up to this one.)
IMO- this reaction has been overdone due to the following:
LLY's Retatrutide has yet to enter ph3 and it will be years before it hits the market. If retatrutide is successful at reducing the number of people with NASH by virtue of its ability to reduce liver fat, it will be still several years more before that effect shows up in actual reduced NASH cases. Call it approximately 10 years of need for true NASH drugs.
Retatrutide had an abnormally high dropout rate of 16% (see #msg-172222042) due to tolerability issues. Also, a new side effect (for the GLP-1 class) of cutaneous hyperesthesia – hypersensitivity of the skin was noted.
Retatrutide is has been nicknamed a triple G by LLY as it targets GLP-1, GIP and the body's receptors for a third hormone, glucagon. In past studies of other drugs, glucagon increased adverse events (e.g.->ALT's phase 2 study on pemvidutide, Boehringer and Zealand's survodutide study)
Retatrutide also had a 11-14% arrhythmia rate which as noted in #msg-172232928 " ought to be quite concerning for a drug that will likely be taken chronically ...(assuming it makes it to market)."
I do agree that however that if a GLP1 based drug is able to reduce liver fat like Retatrutide in a manner that is tolerable the NASH market will eventually be smaller. For reference I have placed The results for fat reduction by Retatrutide below. I would also note Vikings recent announcement about liver fat reduction may have been underappreciated for VKTX 's VK2735 as subjects in the Phase 1 trial had reported liver fat reductions of up to 47% from baseline after only 4 weeks.
Retatrutide was also able to reduce the amount of liver fat in a subset of patients with obesity and nonalcoholic fatty liver disease (NAFLD). At week 24:
While most liver fat reduction occurred in the first 24 weeks, the 12-mg dose reduced liver fat by 86% by week 48. Liver fat content dropped below 5% at week 24 in the majority of patients on the highest three doses, leading to resolution of NAFLD. This occurred in 52% of the 4-mg group, 79% of the 8-mg group, and 86% of the 12-mg group.
"People are best convinced by reasons they discover themselves"
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