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Biotech Enters License Agreement to Validate Biomarker as Alternative NASH Diagnostic
Research Report

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The background and justification for the deal was covered in an H.C. Wainwright & Co. report.

Source: WikiCommons

GENFIT SA (GNFT:PA; GNFTF:OTC.MKTS) signed a license agreement with Covance, LabCorp's clinical drug research and development division, for it to expand access to GENFIT's proprietary biomarker diagnostic test for nonalcoholic steatohepatitis (NASH), analyst Ed Arce reported in a Jan. 3 research report. The deal terms have not been released.

However, Arce pointed out, the companies made clear the main purpose of the arrangement is to gain further proof GENFIT's NIS4 is a valid, preferred way to identify and characterize NASH patients and to yield new insights into how NASH develops through Covance's deployment of it in the clinical research space via its central laboratories.

"This agreement represents a critical step in both validating and ultimately commercializing a simple, noninvasive alternative to liver biopsy for screening and identifying the most appropriate patients for therapeutic intervention," Arce commented, adding that liver biopsy currently is the current test for diagnosing NASH and fibrosis stage.

Arce highlighted that accurate diagnosis of NASH represents an unmet need recognized by the FDA. "There are simply not enough specialists to enable biopsy as a widely available test," he noted, and the failure rate of diagnostic NASH through clinical trial screening is above 50%. Further, liver biopsy is expensive, "highly invasive," and has significant associated risks.

GENFIT anticipates, relayed Arce, that in the 2020–2021 time frame it will receive FDA approval and a CE mark for its NIS4 serum biomarker for NASH and will launch the test across the United States and Europe.

H.C. Wainwright & Co. has a Buy rating and a €105 per share price target on GENFIT, whose stock is currently trading at around €18.15 per share.


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Disclosures from H.C. Wainwright & Co., Genfit S.A., First Take, January 3, 2019

I, Ed Arce, certify that 1) all of the views expressed in this report accurately reflect my personal views about any and all subject securities or issuers discussed; and 2) no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views expressed in this research report; and 3) neither myself nor any members of my household is an officer, director or advisory board member of these companies.

None of the research analysts or the research analyst’s household has a financial interest in the securities of Genfit S.A. (including, without limitation, any option, right, warrant, future, long or short position).

As of December 31, 2018 neither the Firm nor its affiliates beneficially own 1% or more of any class of common equity securities of Genfit S.A.

Neither the research analyst nor the Firm has any material conflict of interest in of which the research analyst knows or has reason to know at the time of publication of this research report.

The research analyst principally responsible for preparation of the report does not receive compensation that is based upon any specific investment banking services or transaction but is compensated based on factors including total revenue and profitability of the Firm, a substantial portion of which is derived from investment banking services.

The Firm or its affiliates did not receive compensation from GENFIT S.A for investment banking services within twelve months before, but will seek compensation from the companies mentioned in this report for investment banking services within three months following publication of the research report.

The Firm does not make a market in GENFIT S.A as of the date of this research report.

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