ROCKVILLE, Md., Nov. 8, 2018 /PRNewswire/ -- Synthetic
Biologics, Inc. (NYSE American: SYN), a late-stage clinical company
developing therapeutics designed to preserve the microbiome to
protect and restore the health of patients, today provided an
operational update and reported financial results for the three and
nine months ended September 30,
2018.
"During the third quarter, we remained sharply focused on the
advancement of our portfolio of microbiome-focused assets," stated
Steven A. Shallcross, Interim Chief
Executive Officer and Chief Financial Officer. "We were pleased to
report the expansion of our relationship with Cedars-Sinai Medical
Center and announced a research agreement to co-fund an
investigator-sponsored Phase 2b
clinical study of SYN-010, our modified-release formulation of
lovastatin lactone designed to treat an underlying cause of
irritable bowel syndrome with constipation (IBS-C). In addition to
fortifying the well-established clinical data set for SYN-010, we
believe results from this study will determine the optimal dose of
SYN-010 for future registration studies. During the third quarter
we also held an End of Phase 2 meeting with the FDA to define a
clear and achievable pathway forward for SYN-004, our
first-in-class therapeutic intervention designed to protect the gut
microbiome from antibiotic-mediated dysbiosis. We also announced
that we are evaluating opportunities that may further unlock the
potential of SYN-004 through the pursuit of a second more focused
indication in a specialty patient population with multiple
potential disease endpoints associated with IV beta-lactam-induced
gut microbiome damage, such as allogeneic hematopoietic cell
transplant (HCT) recipients. This dual approach may enable us to
continue the clinical advancement of SYN-004 in a cost-effective
manner while targeting an area of clear unmet need and expanding
upon the established data set to further validate SYN-004's use in
the broader indication for the prevention of
CDI."
Mr. Shallcross continued, "While remaining keenly focused on the
execution of our clinical development activities, we also
significantly strengthened our balance sheet by raising gross
proceeds of approximately $18.6
million from the closing of a public offering of common
stock and Series B convertible preferred stock, as well as net
proceeds of approximately $11.8
million from the utilization of our "at-the-market" facility
through October. As a result of these activities, our current cash
position to date is approximately $32
million and should provide ample runway to allow the Company
to continue its operations into 2020 as we continue to focus on the
achievement of key clinical development milestones for our two-lead
assets."
Clinical Development and Operational Update
- Entered into agreement with Cedars-Sinai Medical Center (CSMC)
in Q3 2018 to co-fund an investigator-sponsored Phase 2b clinical study of SYN-010 to evaluate SYN-010
dose response and inform Phase 3 clinical development:
-
- The Phase 2b clinical study will
be conducted out of the Pimentel Laboratory at CSMC and is expected
to be comprised of a 12-week, placebo-controlled, double-blind,
randomized clinical trial to evaluate two dose strengths of oral
SYN-010 (21 mg and 42 mg) in approximately 150 patients diagnosed
with IBS-C,
- Anticipate dosing first patient in the Phase 2b investigator-sponsored clinical study during
Q4 2018, contingent upon approval of the clinical study protocol by
the Cedars-Sinai Medical Center Institutional Review Board,
- Anticipate data readout from the Phase 2b investigator-sponsored clinical study during
2H 2019;
- Held End-of-Phase 2 meeting with the FDA to solidify the
remaining elements of the SYN-004 (ribaxamase) Phase 3 clinical
trial in Q3 2018;
- Clarified market/partner needs and identified potential
additional indications for SYN-004 in specialty patient populations
such as allogeneic hematopoietic cell transplant patients in 3Q
2018;
- Plan to initiate clinical trial(s) (2H 2019), which may include
a broad Phase 3 clinical trial and/or Phase 1/2 clinical trial(s)
in a specialty population leading to a subsequent Phase 3 clinical
trial;
- Identified three potential clinical indications for SYN-020
(intestinal alkaline phosphatase) in areas of unmet medical need
including, enterocolitis associated with radiation therapy,
enterocolitis associated with checkpoint inhibitor therapy for
cancer, and microscopic colitis in 3Q 2018,
-
- Anticipated IND filing during Q4 2019;
- Strengthened balance sheet by raising gross proceeds of
approximately $18.6 million from the
closing of a public offering of common stock and Series B
convertible preferred stock in support of the continued advancement
of our microbiome-focused clinical programs in Q4 2018.
Quarter Ended September 30,
2018 Financial Results
General and administrative expenses decreased by 12% to
$1.5 million for the three months
ended September 30, 2018, from
$1.7 million for the three months
ended September 30, 2017. This
decrease is primarily the result of lower salary expense, stock
compensation, and related benefits costs incurred during the three
months ended September 30, 2018 as
compared to the three months ended September
30, 2017 due to the resignation of the prior Chief Executive
Officer, along with the reduction of travel and consulting expense,
offset by higher registration, investor relations and legal costs.
The charge related to stock-based compensation expense was
$186,000 for the three months ended
September 30, 2018, compared to
$583,000 the three months ended
September 30, 2017.
Research and development expenses decreased by 32% to
$2.8 million for the three months
ended September 30, 2018, from
$4.1 million for the three months
ended September 30, 2017. This
decrease is primarily the result of lower SYN-004 (ribaxamase) and
SYN-010 program costs for the three months ended September 30, 2018 since no clinical trials were
ongoing during the quarter. The research and development costs
incurred during the quarter were primarily related to planning for
future Phase 3 (SYN-004) and Phase 2b/3(SYN-010) clinical programs as we sought to
secure the financial resources necessary for the advancement of
these clinical trials. The charge related to stock-based
compensation expense was $289,000 for
the three months ended September 30,
2018, compared to $317,000 for
the three months ended September 30,
2017.
Other income was $631,000 for the
three months ended September 30,
2018, compared to other expense of $5.1 million for the three months ended
September 30, 2017. Other income for
the three months ended September 30,
2018 is primarily comprised of non-cash income of
$626,000 from the change in fair
value of warrants. The decrease in the fair value of the warrants
was due to the decrease in our stock price from the prior
quarter.
Cash and cash equivalents as of September
30, 2018 totaled $9.5 million,
a decrease of $7.6 million from
December 31, 2017, which does not
reflect the proceeds from the sale of our securities during
October 2018. During October 2018, we raised gross proceeds of
approximately $18.6 million from the
closing of a public offering of common stock and Series B Preferred
Stock and received net proceeds of approximately $5.8 million from sales of our Common Stock in
"at-the-market" equity offerings.
Conference Call
Synthetic Biologics will hold a conference call today,
Thursday, November 8, 2018, at
4:30 p.m. (EST). The dial-in
information for the call is as follows, U.S. toll free: +1
888-347-5280 or International: +1 412-902-4280. Participants are
asked to dial in 15 minutes before the start of the call to
register. The call will also be webcast over the Internet at
https://www.webcaster4.com/Webcast/Page/1096/28046. An archive of
the call will be available for replay at the same URL,
https://www.webcaster4.com/Webcast/Page/1096/28046, for 90 days
after the call.
About Synthetic Biologics, Inc.
Synthetic Biologics, Inc. (NYSE American: SYN) is a late-stage
clinical company developing therapeutics designed to preserve the
microbiome to protect and restore the health of patients. The
Company's lead candidates poised for Phase 3 development are: (1)
SYN-004 (ribaxamase) which is designed to protect the gut
microbiome from the effects of certain commonly used intravenous
(IV) beta-lactam antibiotics for the prevention of C.
difficile infection (CDI), overgrowth of pathogenic organisms
and the emergence of antimicrobial resistance (AMR), and (2)
SYN-010 which is intended to reduce the impact of methane producing
organisms in the gut microbiome to treat an underlying cause of
irritable bowel syndrome with constipation (IBS-C). The Company's
preclinical pursuits include an oral formulation of the enzyme
intestinal alkaline phosphatase (IAP) to treat both local GI and
systemic diseases as well as monoclonal antibody therapies for the
prevention and treatment of pertussis, and novel discovery stage
biotherapeutics for the treatment of phenylketonuria (PKU). For
more information, please visit Synthetic Biologics' website at
www.syntheticbiologics.com.
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. In
some cases forward-looking statements can be identified by
terminology such as "may," "should," "potential," "continue,"
"expects," "anticipates," "intends," "plans," "believes,"
"estimates," and similar expressions, and includes statements
regarding our belief that results from the
investigator-sponsored Phase 2b
clinical study of SYN-010 will determine the optimal dose of
SYN-010 for future registration studies, unlocking the
potential of SYN-004 through the pursuit of a second more focused
indication in a specialty patient population with multiple
potential disease endpoints associated with IV beta-lactam-induced
gut microbiome damage, such as allogeneic hematopoietic cell
transplant (HCT) recipients, the dual approach
enabling us to continue the clinical advancement of SYN-004 in a
cost-effective manner while targeting an area of clear unmet need
and expanding upon the established data set to further validate
SYN-004's use in the broader indication for the prevention of CDI,
the proceeds raised providing ample runway and allowing us to
continue our operations into 2020 as we continue to focus on the
achievement of key clinical development milestones for our two-lead
assets, anticipated dosing first patient in the Phase
2b investigator sponsored clinical
study during Q4 2018, anticipated data readout from the Phase
2b investigator sponsored clinical
study during 2H 2019, plan to initiate clinical trial(s) (2H
2019), anticipated IND filing for SYN-020 during Q4
2019; and the potential benefits of SYN-004 and
SYN-010. These forward-looking statements are based on
management's expectations and assumptions as of the date of this
press release and are subject to a number of risks and
uncertainties, many of which are difficult to predict that could
cause actual results to differ materially from current expectations
and assumptions from those set forth or implied by any
forward-looking statements. Important factors that could cause
actual results to differ materially from current expectations
include, among others, , Synthetic Biologics' ability to establish
a path forward to develop SYN-010 and ribaxamase and conduct a
robust, controlled and well-designed clinical trial that may
provide sufficient efficacy and safety data to support a pathway
towards marketing approval for SYN-010 and ribaxamase, Synthetic
Biologics' ability to regain compliance with the continued listing
standards of the NYSE American by September
2, 2019, Synthetic Biologics' ability to comply with other
continued listing requirements of the NYSE American, the ability of
its product candidates to demonstrate safety and effectiveness, as
well as results that are consistent with prior results, Synthetic
Biologics' clinical trials continuing enrollment as expected, a
failure to receive the necessary regulatory approvals for
commercialization of Synthetic Biologics' therapeutics, including
approval of proposed trial designs, a failure of Synthetic
Biologics' clinical trials, and those conducted by investigators,
for SYN-004 and SYN-010 to be commenced or completed on time or to
achieve desired results and benefits, a failure of Synthetic
Biologics' clinical trials to continue enrollment as expected or
receive anticipated funding, a failure of Synthetic Biologics to
successfully develop, market or sell its products, Synthetic
Biologics' inability to maintain its material licensing agreements,
or a failure by Synthetic Biologics or its strategic partners to
successfully commercialize products, Synthetic Biologics' ability
to achieve acceptance of its product candidates in the marketplace
and the successful development, marketing or sale of Synthetic
Biologics' products by competitors that render Synthetic Biologics'
products obsolete or non-competitive, the continued maintenance and
growth of Synthetic Biologics' patent estate, Synthetic Biologics
becoming and remaining profitable, Synthetic Biologics' ability to
obtain or maintain the capital or grants necessary to fund its
research and development activities, a loss of any of Synthetic
Biologics' key scientists or management personnel and other factors
described in Synthetic Biologics' Form 10-K for the year ended
December 31, 2017 and its other
filings with the SEC, including subsequent periodic reports on
Forms 10-Q and 8-K. The information in this release is provided
only as of the date of this release, and Synthetic Biologics
undertakes no obligation to update any forward-looking statements
contained in this release on account of new information, future
events, or otherwise, except as required by law.
- Financial Tables Follow -
Synthetic
Biologics, Inc. and Subsidiaries
|
(in thousands,
except share and per share amounts)
|
|
Consolidated
Balance Sheets
|
|
September 30,
2018
|
|
December
31, 2017
|
Assets
|
|
|
|
Cash and
cash equivalents
|
$
9,549
|
|
$
17,116
|
Prepaid
expenses and other current assets
|
599
|
|
827
|
Property
and equipment, net
|
665
|
|
872
|
Deposits
and other assets
|
23
|
|
23
|
Total
Assets
|
$
10,796
|
|
$
18,838
|
Liabilities and
Stockholder's Deficit
|
|
|
|
Total
liabilities
|
$
4,243
|
|
$
10,195
|
Series A
Convertible Preferred Stock
|
12,234
|
|
12,053
|
Synthetic Biologics, Inc. and subsidiaries deficit
|
(5,681)
|
|
(3,410)
|
Total Liabilities
and Stockholders' Deficit
|
$
10,796
|
|
$
18,838
|
|
Condensed
Consolidated Statements of Operations
|
(In thousands
except share and per share amounts)
|
|
For the three
months ended September
30,
|
|
For the nine
months ended September
30,
|
|
(Unaudited)
|
|
(Unaudited)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Operating Costs
and Expenses
|
|
|
|
|
|
|
|
General
and administrative
|
$
1,474
|
|
$
1,705
|
|
$
4,525
|
|
$
5,440
|
Research
and development
|
2,846
|
|
4,137
|
|
9,788
|
|
15,028
|
Total Operating
Costs and Expenses
|
4,320
|
|
5,842
|
|
14,313
|
|
20,468
|
Loss from
Operations
|
(4,320)
|
|
(5,842)
|
|
(14,313)
|
|
(20,468)
|
Other Income
(Expense)
|
|
|
|
|
|
|
|
Change
in fair value of warrant liability
|
626
|
|
(5,092)
|
|
4,064
|
|
2,157
|
Interest
income
|
5
|
|
4
|
|
20
|
|
7
|
Total Other Income
(Expense), net
|
631
|
|
(5,088)
|
|
4,084
|
|
2,164
|
Net
Loss
|
(3,689)
|
|
(10,930)
|
|
(10,229)
|
|
(18,304)
|
Net Loss
Attributable to Non-controlling Interest
|
(9)
|
|
(8)
|
|
(35)
|
|
(280)
|
Net Loss
Attributable to Synthetic Biologics, Inc. and
Subsidiaries
|
$
(3,680)
|
|
$
(10,922)
|
|
$
(10,194)
|
|
$
(18,024)
|
Series A
Preferred Dividend
|
(61)
|
|
(6,901)
|
|
(181)
|
|
(6,901)
|
Net Loss
Attributable to Common Stockholders
|
$
(3,741)
|
|
$
(17,823)
|
|
$
(10,375)
|
|
$
(24,925)
|
Net Loss Per Share
– Basic and Dilutive
|
$
(0.93)
|
|
$
(4.90)
|
|
$
(2.73)
|
|
$
(7.00)
|
Weighted average
number of common shares
outstanding - Basic and Diluted
|
4,028,304
|
|
3,665,134
|
|
3,802,812
|
|
3,512,868
|
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SOURCE Synthetic Biologics, Inc.