Syntara Limited (SNT) Earnings Call Transcript & Summary

Thanks for standing by, and welcome to the Syntara Investor Webinar for the quarter ended March 2025. [Operator Instructions] There will be a presentation provided by the management which will last approximately 15 minutes followed by Q&A based on questions that have been submitted via e-mail and logged during the session. [Operator Instructions] On the webinar from Syntara today, we have the CEO, Gary Phillips. I'll hand it over to Gary from the presentation.

Thanks, Matt, and good morning to everybody. That's a busy period, and so thank you for sparing us some time to listen to what we have to say this morning. So I'm just going to pick out a few other things which have happened in the last quarter and really look ahead to the news flow that's coming because I guess that's really the point of interest for most people on the call is what comes next. And we were really pleased to be able to announce yesterday that we have had our poster accepted for presentation at the European Hematology Association meeting. So I'll talk a little bit about 5505 recap on the data that we showed at ASH in December. And just talk about the things to look for in the data that's coming up in June at this meeting. It is great. The Hematology Association meeting in Europe is a gathering of some of the world's leading hematologists that allows us the opportunity for the data that we're showing to be reviewed -- peer reviewed by them and live commentary coming out about the data at the same time as we're showing it with the market. So I think that's hopefully, a really helpful thing to do for everybody. During the last quarter, we also announced the progression of the skin scarring program. So that's been going ahead with independent investigator studies with Professor Fiona Wood in Perth and UWA, Fiona Wood Foundation, for a number of years. And the recent analysis of the last study showing just how fundamentally we were changing scar structure has really emboldened us to move forward and bring that program fully in-house with going into a next-generation compound, a topical compound, 9465, which we announced earlier in the quarter and which I'm happy to talk about after this presentation as well. So we're very much excited about that and getting it into the clinic and getting that study underway and getting that new drug through Phase I. And I guess, we can't really talk at the moment about biotechs in the markets without considering the global markets at the moment and the high level -- high degree of uncertainty that exists for future funds and funding of companies like Syntara. So it's really pleasing to sit here actually and to be able to talk about a really strong cash position that we have. We ended the quarter with $18 million. In fact, I'll just dive into that just a little bit further. I mean, we've seen obviously the drop in valuation that's mirrored what's going on elsewhere, Market cap now sitting at just under $100 million. But the cash balance at the end of March was $18 million. And within that, I'm also I'm pleased to tell you that the money that was owed to the company from the company that bought the mannitol business at the end of 2023, all but about $1 million of that has now been paid to the company and is now sitting within our cash. So the cash balance looks actually healthier than perhaps it even did at the end of the previous quarter, and $18 million worth of cash is -- gives the company a runway of around about 18 months. We have historically been spending about $1 million a month unless we kick off a much, much bigger study on 5505, then that cash takes us through to the second half of 2026 and through the many milestones, which I'll talk about when we get to the news flow. So really reassuring, and I think for us as well as shareholders to see strong cash position, particularly at this moment in the market where we see such a lot of uncertainty and difficulty in funding probably for the next foreseeable period, I think. So just to focus on the 5505 and myelofibrosis because that's the key event coming up. I'm sure that many of you listening to me this morning have heard me talk about myelofibrosis before. The study that's ongoing at the moment is one that's on top of standard of care, a JAK inhibitor, ruxolitinib. JAK inhibitors sell around about $1.9 billion per year and despite that, they really are still only symptomatic treatment of myelofibrosis for which the progression for these patients, the outlook for these persons is quite poor with a life expectancy of about 5 years. JAK inhibitors generally being pretty poorly tolerated and causing cytopenias drops in platelets and red cells. And when they come off of these drugs, they only have about 12 months to live. So huge opportunity here for a drug that can work on top of the JAK inhibitor that can do something about the underlying disease and improve the results for many of those patients. So I think -- we think -- we estimate that there's a half to 3/4 of those myelofibrosis patients are on JAK inhibitors, which are not getting an optimum response. There are a suboptimal response to the drug. So out of that $1.9 billion, patients that are on drug, there's about $1 million of that at least, which is the addressable market for a drug like SNT-5505. Action in the American Society of Hematology meeting back in December last year, we presented the first set of interim data from this study, and that was patients that had achieved -- some of them up to 9 months' worth of therapy. And we had 5 patients that were out to 9 months' worth of therapy. The rest of it were at 6 months or 3 months' worth of therapy. If you remember, this trial is running for 12 months. So all these patients will eventually run for 12 months' worth of therapy. And we were interested in 2 main endpoints, the 2 endpoints that the -- both the clinicians and the regulators focus on, which is the symptom score the TSS50. So that says how many patients got a 50% reduction in their symptom score, which is a patient-reported outcome within the period, and then compare it to baseline and then also their spleen volumes as well. So on symptom score, we had, at that point in December, 62% had reached a TSS50 up to the 9 months' worth of therapy. But that was some patients that only completed 3 months' worth of therapy that had got TSS50, some at 6 months, TSS50. But what we were seeing was a gradual improvement in that as time went on. And this is for patients who were -- have been on ruxolitinib for a long time. So these are patients on standard of care. The average was about 3 years. So it was a really impressive result to see 60% of them actually getting a TSS50. And there's some marker of comparator in first-line therapy with a JAK inhibitor, they see something like 40% of patients getting a TSS50. So adding another drug on top of that and lifting those patients who were all suboptimally controlled to a TSS50 is really impressive. The patient numbers are small, but the size of the result, I think, makes it stand out and the consistencies that we were seeing at that point going through to 9 months was also quite impressive. The other side of that was the spleen volume, where we measure the reduction in spleen volume as a percentage. Many of these patients have a spleen that's over 3 liters in size. So it's a very large spleen, a healthy patient with would have a spleen of around about 250 to 300 ml. So that's 3x the size of -- 10x the size of a normal patient spleen. Again, we saw patients improving over time, getting better, the longer they were on drug, which is a novel finding. We haven't seen any other drugs where patients at beyond 6 months also can still continue to improve in their symptom score and their spleen volume. So that was really encouraging. And a spleen volume response of 25% is deemed to be both clinically significant for this group of suboptimal patients, but also from a regulatory point of view, we believe the FDA will probably look at SVR25 as one of the endpoints in the study going forward. So we were seeing at this point that we had 3 patients out to 9 months that achieved an SVR25. And we're now waiting to see what the results look like when we get more patients getting through to these kind of end points. So overall, we were seeing a very consistent result with the monotherapy when we used the drug on its own in an earlier study and that it was very safe and very well tolerated. There's a fairly mixed patient population we had here. So we are very confident now that the safety result we're seeing is going to be reproducible in larger patient numbers. It's -- the safety of the drug, it stands out as being one of its key features and one that really differentiates it from the competition. I think despite the small sample size that we saw, the improvement in symptom score was very encouraging. Although it's a small number of patients, it's certainly a best-in-class result that we're seeing there in terms of the number of patients getting to that level of improvement, particularly given their history and long time on ruxolitinib before coming into the study. And the fact that both the improvement in symptoms and spleen continue to improve over time, again, is a very novel finding. So we're now coming up to the next data point, which is going to be at the European Hematology Association meeting in June. That data will contain all the patients in the study completing 9 months' worth of therapy and the majority of patients getting to 12 months' worth of therapy as well. So it's a considerable additional data point from what we declared, what we showed at the American Society Hematology in December. And we think that, that data set will help inform our discussions with regulatory bodies like the FDA and the European Medical Agency in the second half of 2025. And we expect to get guidance back from the FDA in quarter 3 on how we progress the study, what they think of the data and how we progress the study to the next clinical trial. So our pipeline now looks, I think, quite healthy. 5505, the lead drug is in 2 different diseases, the myelofibrosis, one which is obviously the lead that we talked about with that interim 12-month data coming out in June, myelodysplastic syndrome, 2 studies funded by grant money from the Australian government and the German Cancer Fund, where we expect both of those studies to kick off in -- around the middle of the year and getting interim data in the first half of next year. The skin scarring program with 9465, that's a new drug going into Phase I for the first time. So the first part of that study is looking at healthy volunteers and checking safety and the PK/PD of the drug. So how much is getting into the skin, is it inhibiting the enzymes in the skin, that we're seeing. And the second part of that study, where we're looking at patients with hypertrophic scars, where we expect to see the impact of the treatment over 3 months, and we'll get data back again in the first half of next year from that. Meanwhile, Professor Wood and her group will be looking at keloid scarring with another independently -- an independent investigator study that we'll be supporting her with. And last but not least, 4728 is a drug which is in a fully funded study by Parkinson's U.K. It's in the sleep disorder where patients progress to Parkinson's disease and a high number of them. That study is recruiting in Australia for some months now. But in this last quarter, we announced that the U.K. site, which had been delayed has overcome the technical problems they had with the PET scanner that they were using in the study to scan these patients' brains, that's overcome the patients are now starting to be recruited. We expect full recruitment by the end of the year and data in the first half of next year. So finishing on the all-important news flow and what's going to drive value in the upcoming months. Clearly, the key thing here is that data coming out of the European Hematology Association meeting. It's going to be on the 12th to the 15th of June. We're in a poster session, which is taking place on Saturday, the 14th of June, which is early morning on the Sunday, the 15th here in Australia. We will make sure that we disclose that data in an appropriate fashion alongside what's going on at the Hematology Association Meeting in Milan. After that, we're still on track to submit our briefing book to the FDA, which is proposing the next stage pivotal study Phase II/III study for myelofibrosis alongside the interim data from the study to the FDA. We expect to get an answer back from the FDA in quarter 3. I've mentioned already those 2 myelodysplastic syndrome studies starting around the middle of the year as well as that hypertrophic skin scarring study as well starting. So it's a busy time for the team here at Syntara with a number of trials kicking off and a number of trials producing data and quite a lot of interaction with regulatory authorities at the same time. And then if we look forward to the first half of next year, which is 12 to 18 months down the road, we've got 3 studies due to -- in fact, we've got the iRBD study due to report in the first half. We've got the 2 myelodysplastic studies due to produce interim data coming out at that time period and also the skin scarring study as well. So biotech company with cash through the next 18 months with data from studies that are fully funded coming through in that time and a really key data drop coming up in the very near future in the middle of June. So with that, I'll hand back to Matt and happy to take any questions from the audience at this point.

[Operator Instructions] Gary, you touched on it a bit there around EHA in June, all going well with that. Can you just speak again to what investors can expect from there with 5505 and the next milestones they should be looking for?

So I think the things to look for are primarily the endpoints, which are going to be drivers for that agreement with the FDA on the next clinical study. I mean that we're looking for some degree of confidence that we've got a drug which can hit endpoints, which the regulators value. And those 2 are the TSS50 and the spleen volume reduction. So I think those are the 2 things that we'll certainly be looking at very, very closely in the -- when we're putting the data package together for that poster presentation. Clearly, safety as well is an ongoing thing you never take your eye off that. But we have got, I think, increasingly comfortable with the safety profile of the drug in that we really haven't seen anything to date, which cause us any concern, and it's the thing that opinion leaders, hematologist globally have all remarked on that this is a key asset going forward. Just as a reminder, the drugs that are on the market now, the JAK inhibitors and also the drugs are in development, most of them have a tolerability profile, which includes quite a lot of hematological toxicity and cytopenias that they cause in a number of the patients that are taking the drugs. So that absence in our drug means that this is a clean drug, which could be added on to the current standard of care without making these patients feel worse. So that's a key aspect of it. So yes, looking at what you should be keeping our eye on it. I think it's those 2 things. In December, we showed a very encouraging symptom score improvement and one that looked like it was improving over time and also an emerging story around spleen volume, where we were seeing patients who after 3 years on ruxolitinib and not being well treated and their symptom scores going up and getting worse to see both symptom score and some response in the spleens from those patients after that length of time on ruxolitinib, I think was really encouraging. So we're hoping when we take these patients out to 12 months, but also the additional patient data we're going to get at 9 months and concluding the 6-month data as well is going to be important. So those are the things to look for.

And again, you touched on it there, but just to maybe slightly more specific question that's come through is given we are still waiting data release for myelofibrosis, can you confirm whether an engagement with FDA has all been based on preliminary results?

Yes. So we -- the FDA work on a very sort of specific time frame. And I know that there's been lots of noise in the media around what's happening with the FDA and redundancies and things. But I was encouraged to hear the new head of the FDA talking about still the importance of rare diseases, which myelofibrosis fits into. So we're not anticipating any -- at this point in time, any change in the timetable. So the data set that we are presenting in Milan in June, will form the basis for the briefing book that goes into the FDA in June. And then they work on a specific timetable, which means that we expect to get an answer back in quarter 3. I think we'll be more -- we can be more specific about that as time goes on. But we're marketing more or less on schedule. We've maybe lost a couple of weeks. And while we're waiting for data from digging into certain aspects of the database that we've gotten and waiting on third-party companies to produce analysis of the data we've got. So we've got the full package together to give to the FDA, but still expecting to get that into the FDA in the near term and get a response back in quarter 3.

Another question that has come through, is there the possibility of commercialization of 5505 upon delivery of positive Phase II data without the requirement for a full Phase III study?

So it depends on what you mean by commercialization. I think that there is obviously an opportunity to partner the drug at this stage. So we'll be working these things in parallel. So at the same time -- and I should say that whether we go ahead and do the Phase II/III study, that would enable us to get a registration package together and approval for the drug and commercialization in the sense of actually selling it globally as a product to patients with myelofibrosis or whether we look to attract a partner and license the drug at this earlier stage. Both of those outcomes depend on us getting a positive readout from the FDA, which says, yes, we think your data is enough to support you going into the next clinical study. Yes, we think the safety profile is okay. You need to get this number of patients more to convince us that it's okay to approve. And these are the endpoints that we are looking for. So I think we can go 1 of 2 ways here either down the partnering route or then the route of doing the next study, both in depend on the data that comes out in June and then the subsequent response from the FDA in terms of the outcome of the meeting that we have with them.

And the next question is, how are you thinking about including additional JAK inhibitors in the Phase II/III trial, particularly, it's testing my pronunciation here, momelotinib?

Yes, momelotinib.

Given its growing share, particularly in the anemic population.

Yes. So, it's good to see, I think, that the momelotinib, I think, has made a good start in the market. It is being used in myelofibrosis patients as the question suggests with anemia. It's interesting to see that it's growing the market rather than cannibalizing the market. So it doesn't appear to be taking patients away from ruxolitinib. If you look at their scripts, their quarterly scripts, they look pretty stable. So what we're seeing is a group of patients who are not on ruxolitinib that are being -- certainly being made available for momelotinib. And it'll be interesting to see how that develops over time. Ruxolitinib though is still the, by far, the largest drug in the market by units. And I also note that it's going to be coming off patent in 2028, at which point, there will be a price differential between ruxolitinib and momelotinib. So I think the market share of ruxolitinib will remain high and the number of patients taking it will remain high for a long time. It will be one of the questions that we discussed with the FDA will be whether this next study coming up should be including just on JAK inhibitor, whether there needs to be -- whether that would give us a label for then treating our drug on top of any JAK inhibitors that's in the market or whether it will be specific to ruxolitinib and what kind of data will we need to generate in order to get our drug approved for use on top of other JAK inhibitors as well as rux. So it's a good question and one that we'll be discussing with the FDA in some detail, I imagine.

The next question is, have any other competitor trials had SVR25 rather than 35% as an endpoint?

Yes. Majority of the -- most recent studies we believe from reading FDA minutes and talking with consultants would appear that in the suboptimal population SVR25 is an acceptable endpoint. But again, it will be a discussion point with the FDA when we get there. But from what we're seeing, there is enough precedent to suggest that SVR25 is -- I mean in this patient population, I should just add that the clinicians believe that SVR10 is actually significant for their patients. And given the length of time the patients in our study have been on rux, they certainly think that any improvement in spleen volume is clinically significant. But from a regulatory perspective, we believe that a 25% reduction in SVR is -- would be acceptable. But again, one of those things that will be a question for the FDA.

Today, as we discussed earlier, we've seen another company in the [indiscernible] announced a licensing deal. Can you just speak to your view and sort of approach to a potential licensing deal for Syntara and the potential to do that with 5505.

I guess these deals done with drugs like 5505 at this stage. So if you're -- if we talk about a deal that's done after Phase III, then we've got plenty of comparators out there. The last three deals have been north of $1.7 billion. The last one was actually $2.9 billion for a drug, which was going to be added on top of a JAK inhibitor, which has subsequently had a safety problem. But the comparators there for deal that's done after that stage are there and very clear. If we look at comparative deals that are done four drugs in Phase II, I think there are a limited number of comparators. We've got our own internal ones where we've licensed the drug in the past at the end of Phase I upfront or before starting Phase II, we had revenues of above $80 million taken in on a total deal value of around about $750 million. So that was for a Phase I asset. This drug is in Phase II. It's a large market and an attractive one. So we think a sizable upfront followed by development milestones is also certainly possible for a drug at an earlier stage. But again, it's -- there's different ways of looking at value and different strategies of getting to those points. And we want to keep both our options open at this point and certainly go ahead and plan for conducting the next study because that's the -- as I mentioned during the presentation, getting that approval from the FDA is a key marker of value, both for potential partners now and for people that are going to invest in the follow-up study as well.

The next question is just someone's e-mail through asking can you provide an updated status on the skin scarring studies?

So yes, we've announced a couple of months back, 9465 going into Phase I. So I think this is a really nice way of illustrating the strength of this entire business model, in that having an internal drug discovery group with all the compounds we produce come from our own team meant that once we saw the benefits of first-generation drug, 6302 in the studies that Fiona Wood and her team conducted over in Perth, we were able to quickly analyze the improvements that we could make both in study design and also in the actual drug itself to make sure that we were maximizing both the tolerability profile of the drug and its ability to inhibit those key lysyl oxidase enzymes in the skin at a high level for 24 hours with a daily application. And 9465 was brought through in really, really quickly. I'm really proud of the effort that the team made there to get that through. It's gone through all the preclinical testing in a very short period of time. And in the next couple of months, we will initiate that Phase I study. So the first part of that study will be looking at healthy volunteer patients using a gradually increasing dose of the topical cream just to make sure that we have seen an improvement in tolerability that we expect from the design of the drug. And then once that's done, we will go into patients probably in 2 or maybe 3 centers, all of them in Australia, looking for patients with hypertrophic scars and looking at them over a period of 3 months. and comparing the scars at the end of 3 months with the baseline at the beginning to see whether we're seeing also as well as the changes in structure that we saw in the previous study with 6302, also looking to see if we can get a change in the appearance and the physical properties of the scar as well.

And then another one on skin scarring was other trials for hypertrophic and keloid scars being conducted together or separately in Perth and are you looking at other sites?

No, they are very much separate studies. So the one in hypertrophic scars with 9465 is a Syntara sponsored study, where we will be working directly with the CRO in a number of centers across Australia to conduct and recruit those patients. The keloid scaring one is very much under the management of the Fiona Wood Foundation and UWA and the work that they do together. And that will be a study that's probably done in centers around Perth.

And one final one, are you proposing to use AI tools to expedite trial analysis and results in skin scarring again?

Well, not just in skin scarring, also in looking at the bone marrow fibrosis samples that we take within the myelofibrosis study as well, where -- whether it's machine learning or AI but we are using the latest technology to analyze the cell makeup of tissue samples that we take both from the skin and from bone marrow. Also in the imaging that we take of the scars, we're using the latest technology we can to measure and look at 3-dimensional images for example, of the scars to check on volume as well as appearance pigmentation, a number of different parameters. So we stay abreast of the latest techniques in this area and try to utilize them wherever appropriate, to make sure that we have the best assessment of the clinical samples that we have from patients to see that -- make sure that we reach the clearest conclusions that we can't. We're not missing anything.

Another question is, is there any particular reason for a slight delay in MDS trials?

These are independent investigator studies. So they're not something that we have direct control over the start of. There were some small hiccups in the drug supply, and there was another company supplying drug to the Australian study. Those have been ironed out now. But both studies now are in the final stages before kicking off. So yes, it's almost inevitable when these are the most important things for us. But clearly, there's some of the centers which are involved in these studies, they've got several other things going on at the same time. So their priorities changed slightly, but we believe both studies now are in the final status before starting. There's a lot of enthusiasm in the multiple centers that are involved both in Australia and Germany to look at this drug. And yes, they -- both of them got a very high ranking within the hematology community of both countries to go ahead and progress. So once we've got some of the admin and bureaucracy out of the way, I think they'll both recruit well, and we look forward to seeing results of that in the first half of next year.

Thanks, Gary. That's all a question. I'll just throw it back to you to provide a closing comment.

Thanks. Well, thanks all for your time. And obviously, we're looking forward to this quarter that we're in now, and it's only a matter of weeks really before we get a chance to review that next lot of data from the myelofibrosis study. So it's going to be an exciting time, and I look forward to talking to you again at that point when we've got that data out there again. Thanks very much.