Researchers are certain a liver disease known as NASH affects a large number of people, they're just not sure how high the number goes.

The National Institutes of Health has a broad guess: between 3% and 12% of U.S. adults, or roughly 10 million to 30 million people. That estimate can be traced back to two studies which, combined, looked at data from less than 400 patients. The division within NIH responsible for overseeing liver diseases doesn't have any of its own statistics on how many patients have NASH, or nonalcoholic steatohepatitis.

"They're closer to astrological numbers than astronomical," Pasha Sarraf, an analyst at SVB Leerink, told BioPharma Dive in an interview, speaking generally about NASH population estimates. "They're just made up numbers," he said, "and I don't believe any of them."

The NASH population's size isn't the only uncertainty.

Drug companies and liver organizations have signaled that NASH medicines represent a $35 billion market opportunity.

But investment banks hold a more conservative view. Credit Suisse forecasts the market hitting $20 billion by 2030. SVB Leerink puts it around $12 billion to $14 billion by the same year. RBC Capital Markets models $7 billion by 2026.

Even those estimates may be high, given what's taken place across other liver drug markets.

In hepatitis C, for instance, the market reached around $22 billion by annual sales at its peak. Though the disease affects far fewer patients than what's expected in NASH, its viral nature means patients require pharmaceuticals for treatment. Less severe NASH patients, by contrast, could benefit from lifestyle changes.

And in another, less common liver illness called primary biliary cholangitis, Sarraf notes how a monopoly held by Intercept Pharmaceuticals and its drug obeticholic acid, branded as Ocaliva, hasn't been especially lucrative. Ocaliva net sales totaled $178 million in 2018.

"PBC patients are very motivated," Sarraf said. "Their livers are dying, they have to be treated for this. It's not an optional thing."

NASH, meanwhile, is caused by the accumulation of liver fat, which leads to fibrosis over time. Patients often go for decades without knowing they have it, and can slow or reverse the resulting liver fibrosis by losing weight with diet and exercise.

Studies also suggests NASH is more complicated than other liver diseases, with many development pathways that aren't yet deeply understood. That may give doctors pause when prescribing drugs.

"Across the board, hepatologists are excited for the potential to find a drug that will help. But I’m also nervous that we're going to find medicines that work for some people and not for others, and we're not gonna be able to explain why," said Zachary Henry, a hepatologist at the University of Virginia Health System.

Wrestling for the same patients

NASH patients can experience serious liver damage, but that's not always the case — at least according to the limited population data available. A meta-analysis published in 2015 found that across 411 adults who had either NASH or more general fatty liver disease, 15% were at the two highest levels on a widely-used, five-stage fibrosis scale.

Yet that group is the one many NASH drugmakers are initially fighting for, as the expectation is the sickest patients are most likely to be prescribed and later be covered by insurance for drug therapy.

The four most advanced experimental NASH medicines, Intercept's obeticholic acid, Gilead's selonsertib, GenFit's elafibranor and Allegan's cenicriviroc, have all undergone clinical testing in patients at the middle or high end of the fibrosis scale.

Only Intercept's has scored positive data in a Phase 3 trial, and that trial still found less than a quarter of patients hit the study's primary goal. Between 28% and 51% also experienced itching depending on the dose of obeticholic acid they received, presenting a potential problem since NASH is largely asymptomatic at its earlier stages.

Securing positive data and regulatory approval are just the first hurdles to clear, however. Intercept and others may run into trouble finding patients with moderate to severe NASH — not because there are few of them, but because diagnosing NASH is challenging. The best way to do it is through an invasive liver biopsy, which neither patients nor providers are particularly fond of.

Payers have become wary of liver disease and fat-reducing drugs from past experiences, and will likely put up obstacles as well.

First mover advantage not so great

A lighter-than-expected market opportunity may weigh especially heavy on biotechs that derive much of their value from potential NASH drugs. Small- to mid-cap companies like Viking Therapeutics, Madrigal Pharmaceuticals and Intercept have each seen their stock increase by the double-digits — and sometimes triple-digits — on positive readouts for fatty liver drugs.

Fortunately for NASH drugmakers, there's some time to figure out market dynamics.

Unlike other therapeutic areas, Wall Street doesn't expect much of an advantage from being the first or one of the first with an approved NASH drug. Manufacturers and doctors hold a similar view and note how treating such a large population needs different kinds of drugs that can work in combination.

"It's going to take multiple drugs on the market and the noninvasive tests to really [get the estimated] 10 million patients in the U.S. on treatment. That's going to take a long time," said Steven Seedhouse, an analyst at Raymond James, in an interview.

And while the exact size of the NASH population may not be known, hepatologists are seeing the disease become an increasing burden at their clinics. Researchers expect it to become the No. 1 cause of liver transplants as early as next year.

"The market is huge because obesity is not going away, hyperlipidemia is not going away. All the risk factors for NASH are not going away, they're getting worse," said Kymberly Watt, a gastroenterologist at Mayo Clinic Rochester.