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CANF: Ready to Start Two Phase III Trials in 2017

By Grant Zeng, CFA


On Feb. 8, 2017, Can-Fite (NYSE:CANF) announced through a news release that the Company is ready to commence patient enrollment in the 2Q17 in its global Phase III trial of its lead drug candidate Piclidenoson (CF101) as a first line treatment for rheumatoid arthritis (RA). The trial, titled ACRobat, will enroll approximately 500 patients in Europe, Canada and Israel.

The estimated cost of the entire Phase III study is approximately $5 million. This includes the cost of the global clinical research organizations that have been engaged to help conduct ACRobat. The required supply of Piclidenoson has already been manufactured and paid.

The EMA suggested Piclidenoson should be developed as an alternative to MTX, the most widely prescribed rheumatoid arthritis drug in the world. The EMA further suggested that this pivotal Phase III study will serve as the first of two pivotal studies required for drug approval.

The planned Phase III trial will be a randomized, double-blind, active and placebo-controlled trial to establish non-inferiority of Piclidenoson versus MTX, conducted in approximately 500 patients worldwide.

- Piclidenoson at 1 mg and 2 mg or placebo will be administered twice daily, and MTX or placebo will be administered once weekly.

- The primary endpoint will be Low Disease Activity as measured by Disease Activity Scores at week 12.

- The trial will also evaluate key secondary endpoints, including American College of Rheumatology (ACR) score 20, 50 and 70 and the correlation between A3AR expression at baseline and patients' response to Piclidenoson. Based on Can-Fite's Phase II clinical studies with CF101 in patients with active rheumatoid arthritis, the percentage of patients with high expression of A3AR is estimated to be approximately 70%.

- To establish longer-term clinical efficacy and safety, the trial will continue for a period of 24 weeks.

The company will file similar submissions in the U.S.

Over the several clinical experiences with CF101 for RA, Can-Fite has learned and identified the relationship between A
3AR expression and response for CF101. Based on these findings, the company’s last Phase IIb trial demonstrated positive data of CF101 for the treatment of RA patients based on the level of A3AR expression. The planned Phase III trial uses the same criteria for screening RA patients, and therefore has a high possibility that it will replicate the results of the last Phase IIb trial.

Although approximately 90% of rheumatoid arthritis patients receive MTX at some point in their disease according to the Arthritis Foundation of America, 40-50% of patients stop taking MTX after five years, primarily due to the presence of serious side-effects, as indicated in some published studies. Other studies show that between 10% and 30% of patients are intolerant of MTX, creating a significant need in the market for a new, safe and effective treatment option.

We believe Piclidenoson can offer a superior alternative to MTX.

Update on CF102 for NASH

In early January 2017, Can-Fite received approval to commence patient enrollment in a Phase II study of Namodenoson (CF102) in the treatment of non-alcoholic fatty liver disease (NAFLD), the precursor to non-alcoholic steatohepatitis (NASH). Approval came from the Institutional Review Boards (IRBs) of Hadassah Medical Center and Rabin Medical Center, two leading medical institutions in Israel where the study will be conducted.

Can-Fite is ready to commence patient enrollment in the 1Q17.

- The approved clinical protocol is a Phase II multicenter, randomized, double-blinded, placebo-controlled, dose-finding study of the efficacy and safety of Namodenoson in the treatment of NAFLD/NASH.

- Approximately 60 patients with NAFLD, with or without NASH, will be enrolled in three arms, including two different dosages of Namodenoson and a placebo, given via oral tablets twice daily.

- The primary endpoints will be percent change from baseline in liver triglyceride (fat) concentration measured by nuclear magnetic resonance spectroscopy (NMRS) and safety.

- Secondary endpoints are the effects of Namodenoson on metabolic abnormalities in subjects with NAFLD, including body weight, waist circumference, serum triglyceride and high-density lipoprotein cholesterol levels, and serum liver transaminase.

- In addition, an assessment of the pharmacokinetics (PK) of Namodenoson and the A3 adenosine receptor (A3AR) biomarker will be evaluated prior to treatment and its correlation to patients' response to the drug will be analyzed upon study conclusion.

- Furthermore, the exploratory objective of this study is to evaluate the effects of Namodenoson on relevant biomarkers, such as adiponectin, leptin, C-reactive protein (CRP), and liver stiffness as determined by Fibroscan.

The expansion is based on the compelling pre-clinical data on CF102 in the treatment of NASH. The company recently concluded preclinical study of CF102 in liver disease. In the study, CF102 revealed its capability to improve liver pathology in a NAFLD (non-alcoholic fatty liver disease)/diabetes animal model of NASH.

Key points from the preclinical data of CF102:

- CF102 had a statistically significant reduction in NAFLD activity score compared to placebo.

- CF102 reduced liver-to-body weight compared to placebo.

- Representative photomicrographs of H&E-stained liver sections showed improved pathology in animals receiving CF102 vs. placebo.

- CF102 decreased plasma ALT and triglycerides levels in the livers of NASH-model compared to placebo.

- Liver sections from the placebo group exhibited severe micro- and macrovesicular fat deposits, hepatocellular ballooning and inflammatory cell infiltration, whereas the CF102 treated group showed a significant decrease in steatosis, ballooning and lobular inflammation compared to the placebo group.

In prior preclinical studies, CF102 has shown efficacy in the treatment of liver regeneration and function following liver surgery.

The Implications

We believe the expansion of CF102 into NASH represents an important milestone for Can-Fite in its clinical development.

Non-alcoholic fatty liver disease (NAFLD) is the build-up of extra fat in liver cells that is not caused by alcohol. It is normal for the liver to contain some fat. However, if more than 5% - 10% percent of the liver’s weight is fat, then it is called a fatty liver (steatosis). The more severe form of NAFLD is called non-alcoholic steatohepatitis (NASH). NASH causes the liver to swell and become damaged.

NAFLD affects about 30% of adults and 10% of children in the US, among which 10-30% will develop NASH. 25-40% NASH patients will develop progressive liver fibrosis, while 20-30% NASH patients with advanced fibrosis will develop cirrhosis, which could lead to liver cancer.

NAFLD/NASH represents a multibillion-dollar market, but currently there are no FDA approved medicines for the treatment of NAFLD/NASH.

CF102 is currently being evaluated as a second-line treatment for HCC through a global Phase II trial. The addition of NASH further expands CF102’s liver disease franchise.

CF102 has been granted orphan drug status and fast track designation for liver cancer by the US FDA. In October 2015, the European Medicines Agency (EMA) granted Orphan Drug Designation to CF102 for the indication of HCC.

Balance Sheet Boosted by Recent Financing

As of September 30, 2016, Can-Fite had cash and cash equivalents of $10 million.

In January 2017, Can-Fite closed a $5 million registered offering.

In connection with the offering, the Company will issue 2,500,000 registered American Depository Shares (ADSs) of Can-Fite at a purchase price of $2.00 per ADS in a registered direct offering. Additionally, for each ADS purchased by investors, the investors will receive an unregistered warrant to purchase 50% of an ADS. The warrants have an exercise price of $2.25 per ADS, shall be exercisable six months following the issuance date and will expire five and one-half years from the issuance date.

Also in December, 2016, Can-Fite received its first payment of $500,000 from Chong Kun Dang Pharmaceuticals (CKD). Can-Fite recently announced entering a distribution agreement with CKD for the exclusive right to distribute Namodenoson (CF102) for the treatment of liver cancer in South Korea, upon receipt of regulatory approvals, for up to $3 million in upfront and milestone payments, plus royalties on net sales of 23%.

The new financing not only boosts Can-Fite’s balance sheet, but further validates its technology and clinical programs.

Current cash at hand can carry the company’s operations into late 2017 according to our financial model.


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