Deals involving drugs to treat fatty liver disease (FLD) hit an all-time high in 2016, with more than twice as many completed as in any year previously. The surge in investment interest reflects increased efforts to develop new therapies for the disease.

FLD consists of a variety of chronic liver disorders characterized by excessive fat accumulation in the liver. It can lead to inflammation, fibrosis, cirrhosis and liver failure, all of which affect quality of life, and can potentially be fatal. The global prevalence of FLD has risen at an alarming rate in recent decades.

Non-alcoholic fatty liver disease – and its more severe form, non-alcoholic steatohepatitis (NASH) – have been identified as the main drivers of this growth, mainly due to the rising prevalence of obesity.

The FLD market is still in its infancy, with no FDA-approved drugs currently available, and only a limited number of generic drugs approved in non-US markets. Lifestyle changes and body weight reduction are the main recommendations to control FLD, while liver transplantation is the only definitive option for patients with severe disease, meaning there is an urgent need to develop safe and effective drugs.

The drug pipeline is highly diverse and active, with the majority of products being developed for NASH, a subtype associated with a high risk of cirrhosis, liver cancer and liver failure. There is also a substantial proportion of first-in-class products drugs in development, which is very promising considering the level of unmet need and lack of approved treatment options.

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The recent spike in deal volumes and increasing number of investment opportunities reflects the strong level of drug development, and suggests that innovative and potentially ground-breaking new therapy options could be on the horizon.