Can-Fite Gearing-Up For Phase 2 NASH Program

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CanFite Biopharma Ltd (CANF) is preparing to initiate a Phase 2 clinical study examining namodenoson (formerly CF102) for the treatment of NAFLD/NASH. Over the past several months, the company has been releasing preclinical data with namodenson demonstrating the drug reduces NAFLD Activity Score, micro- and macrovesicular fat deposits, decreased plasma ALT and triglycerides levels, prevents progression of liver fibrosis, and protects against ischemia and reperfusion injury in transplant models.

Quite simply, namodenoson looks like a pan-hepatic improver of liver pathology, applicable to earlier-stage liver diseases such as NAFLD and NASH, for the treatment of ischemia / reperfusion (I/R) injury in patients following partial hepatectomy, and in the treatment of primary liver cancer, including advanced hepatocellular carcinoma (HCC). I think this makes namodenoson an incredibly attractive asset for a potential larger biopharma company to acquired.

Below is a look at the current status of namodenoson and the preclinical data in NAFLD/NASH ahead of the planned Phase 2 trial later this year.

Quick Background on Namodenoson

Can-Fite's namodenoson (formerly CF102) is a selective A3 adenosine receptor (A3AR) agonist currently being investigated in as a second-line treatment for advanced hepatocellular carcinoma (HCC), the leading form of primary liver cancer, in subjects with Child-Pugh B cirrhosis. The 78-patient Phase 2 trial is currently recruiting patients in Israel and select countries in southeastern Europe. I'm expecting enrollment to complete in the next few months and for Can-Fite to report top-line data during the second half of 2017.

The anti-cancer effects of namodenoson are believed to stem from the activation of adenosine, mainly through binding to the A3 receptor (1). The mechanism of action mediated via A3AR agonism includes modulation of key signaling proteins, such as PI3K, GSK-3β, PKA, PKB/Akt, IKβ, and NF-кB, resulting in deregulation of the Wnt and the NF-кB pathways. In 2007, researchers at CanFite found that A3AR is expressed in very low levels in most normal tissues, but overexpressed in a number of different tumor types, including skin, colon, breast, renal, ovarian, and hepatic cancers (2). As such, targeting the A3AR through pharmaceutical intervention is a likely mechanism for apoptosis of cancer and inflammatory cells (3).

HCC is the lead indication for namodenoson. In fact, Can-Fite has received Fast Track designation for the drug as a second-line treatment for HCC, as well as been granted Orphan Drug status given the high unmet medical need and lack of effective treatment options for patients failing first-line therapy. HCC is a relatively small market in the U.S., with roughly 40,000 new cases each year (4). The opportunity in Europe looks similar; however, the American Cancer Society estimates more than 700,000 people are diagnosed with HCC cancer each year worldwide, with 450,000 or so in Asia.

Earlier in 2017, Can-Fite signed a distribution agreement with Chong Kun Dang Pharmaceuticals for namodenoson in South Korea. The deal came with a $0.5 million upfront payment and the potential to earn another $2.5 million in pre-commercial milestones. Can-Fite will also receive 23% royalty on namodenoson sales in South Korea from CKD. While this was not an enormous transaction, investors need to keep in mind that this was only for South Korea and that China is 27x the size. I believe there is a meaningful opportunity for Can-Fite to sign licensing and distribution agreements with namodenoson in areas like China and Southeast Asia that do get investors very excited.

Management has already out-licensed its other clinical-stage candidate, piclidenoson (formerly CF101), to Kwang Dong Pharmaceutical in Korea, so this management team has experience partnering with Asian pharmaceutical companies. Licensing deals that provide upfront cash to Can-Fite for Asia will help support the U.S. and EU development plans and allow the company to expand namodenoson into NASH, which is where I believe the true value of the asset lies.

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