Conatus Pharmaceuticals Reports First Quarter 2019 Financial Results and Program Updates

SAN DIEGO, May 02, 2019 (GLOBE NEWSWIRE) -- Conatus Pharmaceuticals Inc. (Nasdaq:CNAT) today announced financial results for the first quarter ended March 31, 2019, and provided updates on its development programs.

Program Updates
The company is currently conducting two double-blind, placebo-controlled Phase 2b clinical trials in collaboration with Novartis – the EmricasaN, a Caspase inhibitOR, for Evaluation (ENCORE) trials, designed to evaluate emricasan, a first-in-class pan-caspase inhibitor, in patients with liver cirrhosis caused by nonalcoholic steatohepatitis (NASH).

During the first quarter of 2019, the company announced top-line results from a third double-blind, placebo-controlled Phase 2b clinical trial, the ENCORE-NF (for NASH Fibrosis) clinical trial in patients with biopsy-confirmed NASH and liver fibrosis. The trial’s primary endpoint was a ≥1 CRN fibrosis stage improvement with no worsening of steatohepatitis compared with placebo at week 72. The trial did not meet the primary endpoint.

The company announced in March 2019 the selection of its first internally developed product candidate, CTS-2090, an orally active inhibitor of caspase 1. Caspase 1 occupies a uniquely central position in the NLRP3 inflammasome pathway and blocks activation of the potent inflammatory cytokine IL-1β. Blocking IL-1β is a clinically validated approach to treating inflammatory diseases, with several injectable biologic products using that mechanism of action already on the market. CTS-2090 is currently in preclinical development and IND-enabling studies, with an initial clinical trial planned to begin by the first half of 2020. The company plans to pursue rare autoinflammatory diseases as initial clinical targets for CTS-2090.

Financial Results
The net loss was $4.7 million for the first quarter of 2019 compared with a net loss of $5.0 million for the first quarter of 2018.

Total revenues were $7.0 million for the first quarter of 2019 compared with $9.7 million for the first quarter of 2018. Total revenues consisted of collaboration revenues related to the Novartis agreement. The decrease in total revenues was primarily due to lower emricasan-related research and development expenses resulting in corresponding lower revenues related to the Novartis agreement.

Research and development expenses were $9.4 million for the first quarter of 2019 compared with $12.1 million for the first quarter of 2018. The decrease in research and development expenses was primarily due to lower spending related to the ENCORE-PH clinical trial and manufacturing activities, partially offset by higher spending related to the ENCORE-LF clinical trial.

General and administrative expenses were $2.6 million for the first quarter of 2019 compared with $2.7 million for the first quarter of 2018.

Cash, cash equivalents and marketable securities were $33.8 million at March 31, 2019, compared with $40.7 million at December 31, 2018, and a projected year-end 2019 balance, without including any potential milestone payments under the Novartis collaboration, of between $10 million and $15 million.

About Conatus Pharmaceuticals
Conatus is a biotechnology company focused on the development and commercialization of novel medicines to treat chronic diseases with significant unmet need. In collaboration with Novartis, Conatus is developing its lead in-licensed compound, emricasan, for the treatment of patients with NASH-driven chronic liver diseases. Conatus is independently developing its lead internally developed compound, CTS-2090, for the treatment of patients with chronic diseases involving inflammasome pathways. For additional information, please visit www.conatuspharma.com.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts contained in this press release are forward looking statements, including statements regarding:  the timelines to announce results from the ENCORE clinical trials; the plan and timeline to begin an initial clinical trial of CTS-2090; the initial clinical targets for CTS-2090; and the projected year-end cash balance. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continues” or the negative of these terms or other similar expressions. These forward-looking statements speak only as of the date of this press release and are subject to a number of risks, uncertainties and assumptions, including:  Conatus’ ability to successfully complete its ongoing and planned clinical trials; Novartis continuing development and commercialization of emricasan; Conatus’ reliance on third parties to conduct its clinical trials, including the enrollment of patients, and manufacture its supplies of emricasan and CTS-2090; potential adverse side effects or other safety risks associated with emricasan that could delay or preclude its approval; results of future clinical trials of emricasan; Conatus’ ability to obtain additional financing in order to co-commercialize emricasan or develop CTS-2090 or other compounds; and those risks described in Conatus’ prior press releases and in the periodic reports it files with the Securities and Exchange Commission. The events and circumstances reflected in Conatus’ forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Except as required by applicable law, Conatus does not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.

Conatus Pharmaceuticals Inc.
Selected Condensed Financial Information
(In thousands, except per share data)
  Three Months Ended
Statements of Operations March 31,
  2019 2018
Collaboration revenue $7,024  $9,737 
Operating expenses:    
Research and development  9,383   12,081 
General and administrative  2,591   2,713 
Total operating expenses  11,974   14,794 
Loss from operations  (4,950)  (5,057)
Other income/expense  203   39 
Net loss $(4,747) $(5,018)
Net loss per share, basic and diluted $(0.14) $(0.17)
Weighted average shares outstanding used in computing    
net loss per share, basic and diluted  33,165   30,048 
   March 31,   December 31, 
Balance Sheets 2019 2018
Current assets:    
Cash, cash equivalents and marketable securities $33,833  $40,692 
Collaboration receivables  3,860   3,677 
Prepaid and other current assets  2,633   3,057 
Total current assets  40,326   47,426 
Property and equipment, net  145   154 
Other assets  1,707   1,223 
Total assets $42,178  $48,803 
Liabilities and stockholders' equity     
Current liabilities:    
Accounts payable and other current liabilities $8,625  $8,446 
Current portion of deferred revenue  8,150   10,075 
Total current liabilities  16,775   18,521 
Deferred revenue, less current portion  1,576   2,815 
Other long-term liabilities  229   68 
Stockholders' equity  23,598   27,399 
Total liabilities and stockholders' equity $42,178  $48,803 

CONTACT: Alan Engbring
Conatus Pharmaceuticals Inc.
(858) 376-2637