Update Aug 11 2025.

FDA says SNT-5055 needs another phase 2. This breaks the idea. More money and time required. A phase 3 was expected but now another phase 2 with placebo is required. The thesis is broken. On the plus side, the company has other after assets so makes sense to have some residual value. Greater than zero, that is. Currently a 50% drop.

What learnings can we take? It's biotech, high risk, with very real chance of random failure even with good data which is the case here. SNT-5055 still has a chance to be developed, but it's more money and time required now. The other factor is the current US environment makes the FDA even more whimsical and delayed. One learning could be to fish in a different pond, or have more pans in the biotech oven, since some will inevitably fail. Perhaps I let the emotions in - was I attracted to the curing aspect? Do I know all this to start with? Yes, but it seems I must learn the lesson the hard way.

For me chalk this one up as going too far outside my area of focus - stick to my knitting, subject my ideas to higher hurdles and avoid this pond - it's more of a swamp!

Small biotech with focus on specialist chemistry (lysyl oxidase chemistry). Multiple drug candidates.

Goal seems to be to sell asset to big pharma after phase 3 results.

Overview:

   • Drugs developed in house

   • 4 out of 5 drug development funded non dilutively (some by aus/german government)

   • ~50% of registry in institutional hands

   • Private capital raise of $15m capital @ $0.06/share but could have taken double (30m)

   • Likely capital raise at completion of Myelofibrosis (SNT-5055) phase 2 in mid 2025 (~70m needed)

   • Myelodysplastic syndrome (MDS) studies starting in 2025

SNT-5055

Background:

Myelofibrosis - current standard of care (JAK inhibitors) work, but not really stopping disease (i.e. unmet need). Targeting mutation therapy still far away. SNT-5055 is different it's targeting lysyl oxidase, i.e. different mechanism to SoC. But this mechanism will likely have slower changes in spleen because it targets bone micro environment to start with not the spleen directly i.e. in combination with SoC or other JAK inhibitors likely.

   • Phase 2 underway, results positive so far, good toxicology and tolerance. Still question if symptom reduction will beat SoC

   • Full results of Phase 2 Q1, Q2 2025 pivotal registration study talk with FDA starts with output in June

   • Then likely capital raise after this or deal/partnership for phase 3 start

Phase 3, need minimum 300 patients, 6-12 months (likely longer). Still a risk the drug doesn't meet Total symptom score (TSS) requirements, this could be mitigated by phase 3 study length (drug seems to improve effect over time) or patient selection. Likely need 60-100m AUD for this, they will either raise capital or do partnership, or combination of both. Given there was overdemand in recent capital raise I think raise is likely (>50%).

Exit

Since most of register is specialist healthcare funds the only way they can exit is via sale to big pharma or sale of each drug piecemeal (not sure redistribution mechanism in this case).

If we focus on SNT-5055, the buyer must consider how it fits in with their current portfolio, the good thing is that SNT-5055 is different mechanism and adds to existing JAK inhibitors but also means more work required for buyer to understand and could be seen as more 'risky'. Novartis write-down of MorphoSys by $800m due to safety concerns also highlights the risk, and apparently Novartis was just interested in just the pelabresib asset. Sale of just SNT-5055, given long patent and SNT's multiple drug make-up seems a good option for both parties (strong residual value for SNT). Single asset would likely receive lower amount than the examples in presentations e.g. lower than $1.6-2.1b USD. With SNT-5055, unlikely anything happens prior to phase 3 given how it's quite different, but if there was strong interest, expect a partnership with SNT for the large stage 3 study - this could be a derisking event for SNT and would increase my valuation.

What's the Background?

Syntara released this afternoon interim 6 month data for the treatment of Myleofibrosis utilising its drug, SNT-5505. SNT-5505 is the most advanced and most valuable asset owned by SNT.  The company has around 25 staff and CEO Gary Phillips (GP) has been there for about 11 years. They have cash enough to take them through to mid 25.     SNT has a m/cap prior to the release of today’s data of around $90m.

This is significant for SNT and SNT director Hashan Desilva whom is also CIO of his recently launched biotech fund KP Rx.

Syntara and Curvebeam (ASX:CVB) are two of KP Rx fund’s major investments.  CVB has come off over 50% since floating, so KPRx had a lot riding on the success of SNT-5505.

I mention KP Rx and Hashan as he recently did a good buy-case write up on SNT on Livewire:

The ASX-listed Biotech set to unlock significant value - Hashan De Silva | Livewire

Results were?

Firstly it appears to be well tolerated. 

Secondly from this afternoon’s release:

“At 12 weeks of treatment, 46% of evaluable patients3 achieved a 50% improvement in Total Symptom Score (TSS50) which improved to 80% at 38 weeks of treatment. TSS50 is a standard efficacy endpoint used as the primary endpoint in MF clinical trials.”

As summarised by Professor Claire Harrison, Professor of myeloproliferative neoplasms at Guy's and St Thomas' NHS Foundation Trust:

“This interim data confirms the excellent safety profile of SNT-5505 and also suggests that the mechanism of SNT-5505 may exert a long-term effect on the disease, with both symptoms and spleen volume continuing to improve as we now see patients on drug for 9 months. This hasn’t been seen before with this class of drug and holds potential for real long-term benefits for MF patients. I look forward to seeing the data mature in the coming months to confirm these important early findings.”

Market summary release:

pdf

Presentation today at the 66th American Society of Hematology annual meeting (ASH).

ASH 2023

Did they have anything useful to say on the Conference Call?

Both CEO Gary Phillips and a lead clinician Prof Harrison were on the call. 

i)                        GP was a little dismissive (surprisingly) of the 12 wk data calling it a “honeymoon period” for patients. He placed much more store on the 38 wk data, (though only for five patients) where 80% TSS50 figure was reached.

ii)                      GP said the TSS50 was the FDA primary end point and he felt the secondary end point was up for negotiation though likely will be spleen size.

iii)                    Since 5505 is intended to stop fibrosis in the marrow GS was asked about Bone Marrow Failure Scores (BMF). GS said not all the results were back yet and all results would be looked at in the one lab when received.   Prof Harrison said this was difficult since the improvement in bone marrow took many years, then said later it took at least 12 to 18 months.

iv)                    Hematological improvements. Again Prof Harrison talked of this taking a long period of time. She indicated that the TSS50 and Spleen size were RUX benefits in any case. The inference appeared to be the need for 5505 to show this and more – ie BMF improvement and hematological improvements but both take long time frames. (Interesting)

v)                      Competition. GP spoke to 3: Pelabresib (Novartis) drug being stopped due to safety concerns. Navitclax – worked well on spleen reduction but faded in time. Navtemadlin going in Ph3 good results but not as well tolerated as 5505.  

What now?

In today’s release CEO Gary Phillips indicated:

“After receiving data from a subset of patients reaching 52 weeks of treatment by March 2025, the company intends to discuss with the FDA the trial design for a pivotal Phase 2c/3 study. Concurrently, the company will also engage with potential global and regional partners.”

By March we will have further readouts. Also by mid next year SNT will be in need of cash, so the last point is likely to be highly relevant.

(In SNT’s release to the market on the 28/11/24, SNT indicated an addressable market of $1b).

Your thoughts?

Like most everything in life FIIK. Prof Harrison called the data impressive and liked that it got better over time. In March 25 there will be further readouts and by mid 25 the important FDA feedback.  

GS in the Conference Call lead-in talked (again) about the sophistication of SNT’s register - over 50% institutional.  And emphasised how these investors have in the past made a lot of money out of myelofibrosis related drugs and by inference know what they are talking about.  So I guess when trade in SNT shares resumes tomorrow the worlds biotech investing elite will tell you what they think.  

FDA on PXS - 5505 myelofibrosis ongoing study

The science in the charts below

Phase 2 clinical trial of PXS‐5505 in myelofibrosis (MF). Following helpful feedback from the U.S. Food and Drug Administration (FDA), the trial will be widened to include myelofibrosis patients already receiving a JAK inhibitor as standard of care in combination with PXS‐5505

29-Dec-2020:  Pharmaxis Receives US$7m milestone from Chiesi

Also:  Pharmaxis email communication to those on their email list about today's announcement

Pharmaxis Receives US$7m Milestone

Pharmaceutical research company Pharmaxis Ltd (ASX: PXS) has today received a US$7 million (~A$9.2 million) milestone payment from its US licensee Chiesi Farmaceutici S.p.A. (Chiesi) following the recent approval by the US Food Drug Administration (FDA) of Bronchitol®(mannitol) for the treatment of cystic fibrosis.

A further US$3 million is payable by Chiesi on shipment by Pharmaxis of commercial launch stock, scheduled for the first quarter of 2021.

Pharmaxis reported cash funds of A$10 million at 30 September 2020 to which it has since added a R&D tax incentive of $5 million in October and this milestone of A$9 million.

On 2 November 2020 it was announced that the FDA had approved Bronchitol, the drug Pharmaxis developed, for the treatment of adult cystic fibrosis patients in the United States.

--- ends ---