Syntara Limited ($SNT)

Welcome to the Syntara Investor Webinar and Q&A following announcements through the week regarding FDA feedback on the proposed Phase IIb trial of amsulostat in myelofibrosis, the capital raising and the Appendix 4C quarterly, which was just lodged with the ASX. [Operator Instructions] On the webinar from Syntara, we have the CEO, Gary Phillips, and I'll hand it over to him now.

Thanks, Matt, and thank you to all of you who have called in this morning. The title of this first slide is the positive FDA review of amsulostat. But of course, we've also got the capital raise and the quarterly to review as well. So there's a fair amount of content here. And I will step through it and try and stick to the thing, which I believe are most relevant for investors, and I'm happy to take any questions at the end about any of these topics. So if I'm looking at this overview of the slide, I think the things that we're going to focus on today are, first of all, the lead asset, amsulostat. We've reported on positive data from Phase II last year. And now we have an agreed way forward with the FDA for the next trial. So I'll spend some time going through why that's important, what the relevance is that for shareholders and what it allows the company to do next. We'll then look at the capital raise and clearly, the pro forma here is now up to $16.9 million, assuming the $8 million placement proceeds. It's not including anything from the SPP. And that gets us through to quarter 3 2027, which when we get to the pipeline slide and you see the news flow and when that's coming, will be a very relevant time period for you to look at. So amsulostat, it's worth, I think, just recapping what is it about this asset which is exciting. Where has it got to? What's already achieved? And where does it go next? So this is an asset that's already had IND orphan drug designation going through. We also fast track. It's a first and best-in-class in its area. So that's important in terms of -- there are no other drugs in development in myelofibrosis or other blood-related cancers or in fact, any other indications that cover off this particular enzyme group. And we've got a global lead in this area, and we've demonstrated efficacy and safety from this particular area. So we need to protect that, and we need to think about how we can exploit it going forward, particularly on the background of it, it's got a very long patent life as well. So this -- our lead asset, amsulostat has a patent life to 2042, and there are ways we can even improve on that. It's already got multiple nature publications, both for preclinical across several different indications, including blood cancers and also solid tumors as well. And not only the publications, but we've reported on the clinical data app in environments where we've got the world's global meetings of hematologists looking and assessing what we've got and getting their commentary on the data that we've had to date. And I think everybody agrees that what we have is a clearly differentiated and very competitive, both safety and efficacy profile. And that has the potential for a breakthrough therapy in myelofibrosis because these patients are currently inadequately controlled, many of them on the current standard of care. There are a number of different ways that clinicians are trying to solve that, but our stands out in terms of its safety profile and the early efficacy signs as well being very promising in an area which we think both patients and clinicians will be very receptive to. And what we can talk about today then is what the FDA thinks of that as well and the importance of that. So myelofibrosis is fibrosis of the bone marrow, our body's blood production unit. These patients have about 5 years to live, and they're currently treated on a drug called a JAK inhibitor, which although helpful in some extent is to -- in terms of spleen size, in particular and also in reducing their symptoms also causes a lot of cytopenia, so dropping red cells and platelets in particular, meaning that the clinicians have to reduce the dose of the JAK inhibitors being given. And as a result of that, obviously, the drugs become less effective and eventually, they have to drop off of these drugs and then they only have about 12 months to live when that happens. So there's a large unmet need there. Despite this sort of limitation, the market for these drugs is approaching $2 billion per annum. And because of the unmet need, there's a lot of commercial interest in any drugs which are being developed in this area and then have clinical data. And I'll show you the chart in a minute of the deals that have been done, of which there was another one earlier this week, which we can -- it's not on the slide, but we can talk to. So amsulostat has a distinct mode of action. It's inhibiting this family of enzymes that cause the increased bone marrow fibrosis and growth factor activity within the bone marrow. And both of those have a very detrimental effect on the production of healthy blood cells. So blocking that enzyme preclinically showed great promise and also now in the clinic shows great promise for these patients. What we've demonstrated with the trials we run to date is that we see a really significant improvement in symptom score. And I'll relate this back to the conversation we had with the FDA in a moment. But clearly, symptom score is probably the most important endpoint for patients and clinicians, but also the regulator as well. And we have 3/4 of the patients in our study beyond 6 months had a reduction in symptom score of 50% or more. And that is quite an outstanding result relative to current drugs on the market and also drugs in development. So that's a figure and an aspect of the drug, which is compelling and is attracting a lot of attention from both the hematology world, but also pharmaceutical companies that are following this space as well. We also see reductions in spleen volume. And as I mentioned before, this is a really strong safety signal. So what happened with the FDA? So we -- if you remember back to last year, we had gone to the FDA with a proposal for an adaptive Phase II/III study. The FDA took a more conservative approach than we were expecting and kind of said, rather than do an adaptive design, we believe that you should do a Phase IIb study, look at the results of that and then design the Phase III that comes after it. Having listened to their feedback and consulted with our both clinical advisers, but also regulatory advisers and people that had recent experience with the hematological nonmalignant division in the FDA, which we deal with. We submitted a proposal for a protocol and a clinical pathway for the drug going forward. And we had a meeting -- a face-to-face meeting with the FDA in Washington. We sent a small team there to meet with them to have a really good discussion and then to make sure that we had a good understanding of what the drug was doing, what was capable of and the rationale behind the protocol that we had proposed. And I'm pleased to say that, that meeting was, I think, I would describe it as collegiate. We discussed all the potential issues that there were with the development path, came to agreement on how those would be played out within the next Phase IIb protocol. And we now have FDA support for that clinical trial design. The next step in this is to give them a very detailed protocol on the back of this, but that's really only a minor, a minor step at this point. We have an agreement on the protocol itself, the broad strokes of the protocol and how that will be placed in terms of size, how it's blinded, the entry criteria for the patients that are going to be there, et cetera, et cetera. I think of note at this point also is that having discussed all the potential endpoints for this study, of which there are mainly symptom control, spleen volume, but also some of the hematological endpoints as well in terms of blood counts. The FDA were very clear that they are very comfortable with the idea of us having a primary endpoint, which is TSS50, a 50% reduction in the total symptom score. Now you remember back to my earlier slide, that is the key strength of this drug. Compared with other competition, that is the one endpoint, which really stands out as being potentially with a small -- relatively small study to this point being a real breakthrough in this particular disease. So we're very comfortable with the idea that we have TSS50 as the primary endpoint. Clear, there will be other endpoints as well as secondaries and the thing, but we now have an outcome for a clear path to advance the drug into late-stage clinical development, which is a really positive step forward for both the drug and the company. This is the protocol itself at a high level. And you'll see that we've got 2 cohorts in here in this design. One of them is dealing with patients who are on the current market-leading drug, ruxolitinib. So 75 patients would be on ruxolitinib, 50 of them will be on amsulostat as well and 25 of them on placebo. So it's a 2:1 randomization. And in the other cohort, we're also considering the inclusion of momelotinib, which is a drug from GSK, another JAK inhibitor, which has taken about 25% of the market is for patients with myelofibrosis who are also anemic. But given the market, we think that's also an interesting cohort to follow. So the study itself will run for 9 months. Many clinical trials in myelofibrosis run for 6 months in duration. And many of them have spleen volume as their primary endpoint or coprimary endpoint. Largely the nature of a lot of these drugs that spleen volume is something they work on. But as I said, FDA is very comfortable with the primary endpoint of symptoms, TSS50, very comfortable with the idea that we run this study to a length which we think suits our drug. And we have seen a really competitive advantage of our drug is that the increases and improvements in symptom control and spleen volume don't plateau and stop at 6 months. The response to the drug keeps on deepening as we go beyond 6 months. And we wanted to capture that within the study design. So we are looking at these patients out to 9 months. We think that the study will be ready to start. We're investing in the clinical trial supplies for this now and the studies. We will be able to start it by the end of the year. So why does this milestone matter for investors? Well, I think, first of all, the formal alignment with the FDA very much derisks the regulatory and development pathway. And that, in particular, then strengthens amsulostat value ahead of potential discussions with partners. So if you think of it in this way, the FDA has validated the program that we've run to this point and agreed with the process, which will run further going forward. So it removes a lot of questions around the development of the drug, which potential partners would want to be addressed before investing in it. It reinforces our differentiated position and with the fast track and orphan drug designations already secured, I think this is a really positive step forward. And of course, we've also got the additional upside of those 2 studies in myelodysplastic syndrome, a related bone marrow cancer that are already underway, and we see those as producing preliminary data before the end of the year. So we now have a validated strategy for amsulostat. It's a clearer path to value creation. And within this one drug, never mind talking about the rest of the pipeline. Within this one drug, we now have multiple near-term catalysts for shareholders, some of them within the next 12 months. So we talked a little bit about the interest from strategics. And I think many of you who have been following the story have seen this slide before with the 2 drugs over on the right-hand side being other JAK inhibitors, which sold after Phase III data for $1.7 billion and $1.9 billion. The Novartis acquisition of MorphoSys for pelabresib, which was $2.9 billion after Phase III studies in 2024. That drug has not made it through to the FDA on the back of the existing Phase III studies, and we understand is having to do a further Phase III study to address concerns that the FDA and the company have over that drug at this particular moment in time. And then we've got the 2 on the right, which are perhaps a bit more relevant for us in that they are drugs which are at Phase II. Therefore, they're not completed Phase III. They've got limited amount of Phase II data. And we've got examples there of upfront, which are between USD 100 million and USD 200 million and both of them with deal values more than $1 billion. I should add to that, that we had another deal that was announced earlier this week with Lilly acquiring a company called Ajax. Ajax have a variation on another JAK inhibitor. So it's being positioned as a JAK inhibitor that may have improved efficacy over existing JAK inhibitors based on preclinical data. It's not known yet whether it will have the same tolerability issues that other JAK inhibitors have. Certainly, there's a strong link between the mechanism here of a JAK inhibitor and the tolerability and toxicity that exhibited. So we will have to wait and see whether -- how much improved that JAK inhibitor is. But this is a JAK inhibitor that has, I think, only got Phase I data. They haven't published the Phase I data that they've got yet. We're not expecting to see it until next year. But Lilly, having invested early on in Ajax in an earlier round, the deal they announced this week was worth $2.3 billion. Now they haven't announced what the split is between the upfront and the milestones that would go through. Clearly, the upfront will be smaller than we're seeing on the right-hand side with those other drugs post Phase III. But it's just another endorsement of commercial activity in this space and the desperation of companies to try and find something that is an improvement on what is there. And even a slightly improved JAK inhibitor is attracting deal sizes, which are in the hundreds of millions upfront and multibillion-dollar deals even for drugs with just Phase I data. We have an asset which has gone through Phase I and already has Phase IIa data as well. So then just to round out the company update before I just get to the capital raise. This is the news flow for the period, and you'll see when we get to the capital raise that all of these endpoints here are within the runway that we have with the raise that we've just accomplished. Clearly, we've now got the FDA-approved development plan, and we will be in a position to commence the Phase IIb study later this year. We're expecting interim data from the 2 MDS studies by the end of the year. The topical pan-LOX inhibitor, which is the same technology delivered as a cream, the only pharmacological treatment that's going through clinical development at the moment in this particular kind of skin scarring that we're aware of. Huge hope for this as a medication based on earlier clinical placebo-controlled studies, which showed this mechanism does improve the structure of scars and the vascularization of scars. We've got 2 studies, one in hypertrophic scarring and one in keloid scarring. Both of those studies are still in the recruitment phase. We do expect to have results from both of those studies in the second half of the year. And then finally, one that's very imminent now is our study into a sleep disorder, iRBD, where the patients go on to develop Parkinson's disease. And we expect that study is already fully recruited. The last patient that has had their last visit. So we are now in the analysis phase. We expect to see data from that study before the end of quarter 2. At least from the primary endpoint before the end of quarter 2. So there's a lot of news flow to come here and all of it coming from drugs in Phase Ib or Phase II trials where we're expecting to see both safety and efficacy results, which will be real value events for Syntara and its investors. So just then briefly touching on the capital raise that we completed yesterday. We've raised $8 million via an institutional placement, and we're also targeting approximately $2 million from a share purchase plan for total proceeds of around $10 million before costs. The capital raising was clearly on the back of that positive FDA Type C outcome for amsulostat, and it supports the next phase of execution of moving towards that trial. And the placement received very -- I was delighted to see the strong support we got from both existing and new institutional and sophisticated investors. The SPP will be open to all eligible shareholders in Australia and New Zealand. And the issue price on the deal was $0.027, which was around about a 15% discount on the day compared with the price it last traded at. From a shareholder perspective, what we see then is extending the cash runway through to quarter 3, '27 with that $8 million placement. It funds 5 key clinical trial readouts across this calendar year and supports the ongoing licensing discussions that we're having across that pipeline as well. Every single data point we get from a pipeline asset reaching those clinical efficacy and things is not only a clinical endpoint, but there's also a potential commercialization point as well. It supports the Phase IIb study. So it will be used to finalize the protocol, select CROs for doing the study, site negotiations, formulation work and clinical trial supplies. And also, we -- as I mentioned at the beginning, we are in a very strong position with our Pan-LOX drug being a first-in-class and best-in-class, and we aim to strengthen our patent suite as well to make sure that we defend that well and that underscore the value of this for any potential partner coming in. So objectives for the overall raise was clearly to fund the clearly defined near-term milestones, position the company to deliver shareholder value through clinical and commercial progress that we expect to see within the runway that this capital raise gives us. With that, I will stop. And Matt, I'm very happy to take any questions that we have.

[Operator Instructions] Gary, a good segue from where you finished there. There's a question here just around someone being surprised at the timing of the capital raising. And I mean this question has also cited that a view that going to Phase IIb rather than Phase III, they thought would have extended the runway. Do you just want to comment on the timing and that point as well?

So from a timing perspective, I think we wouldn't have expected that the announcement of a sort of an FDA approval to our Phase IIb protocol would have in the markets as they exist today, would have seen much appreciation in the value of the stock at this time. So despite that, it was clearly a step forward for the asset and removed a lot of risk. So we thought it was an appropriate point to raise capital on that. It gives all of the investor base and the people coming in on this raise as well, the opportunity with that extended runway now to see the advantage from the number of endpoints and news flow that we have coming in the next 12 months. So whilst it was -- we could have waited a little bit longer and delayed it until we had an outcome say from the Parkinson's disease study later on this quarter. But that's a placebo-controlled study. We don't know whether that will be positive or negative as yet. So from a prudency point of view, we felt from a timing and for the existing shareholders, the best thing was to do the capital raise on the basis of removing the uncertainty around the pathway for amsulostat and allowing then everybody to benefit from the news flow that's coming within the extending runway that we have. Matt, sorry, what was the second part of the question?

It was just with regards to going to Phase IIb rather than Phase III should that have extended the runway.

So I should be clear. I mean this capital raise does not fund the Phase IIb study. It gets us to -- it's very important for the company now that we have with this FDA approval or agreement to the protocol with us and the derisking of this pathway. We're now clear to engage with the companies that we've -- many of which we've already had 3 or 4 discussions with about whether they see commercial value in talking to us now ahead of starting the Phase IIb. So the Board of Syntara said it will explore both the potential commercial value of amsulostat as an asset now and also the interest from investors in investing in a Phase IIb study, which would start later on this year. So Phase IIb or Phase III, I think the value of the asset at this point in time is the same whether we were starting a Phase IIb or a Phase III. We are selling -- we would be partnering on the basis of the existing data and the pathway that the FDA have laid out before us. I believe also that any potential partner looking at our drug, a Phase IIb study would be probably their preferred clinical pathway route rather than jumping straight into a much larger Phase II/III study where there are more uncertainties about the endpoints and agreeing the endpoints before you got to the Phase III. So I think what we have now is an appropriate pathway forward, an agreement from the world's largest and most significant regulator over something that derisks the asset and will encourage companies to take a very close look at the data package we have and the plan to progress it from this point forward.

Another question was, can you shed any light on the new institutional investors coming in, other specialist healthcare funds, et cetera?

I'll do that. Yes. And I think it's always been a strength of Syntara, the depth of specialist healthcare investors that we have in the stock. And I would say that remains more or less the same post this raise. We have very strong support from our existing shareholders, and we have some new institutional money in and some washing backwards and forwards. But overall, I would think that the amount of support is similar. And again, a lot of the money coming in has been from sophisticated investors who understand the healthcare space extremely well.

The next question is TSS is subjective spleen size is objective. To what degree might placebo effect impact the result in a blinded study?

So one thing you should -- the spleen size is an endpoint that's there because it's the one thing that a JAK inhibitor does well amongst all others. I've faced this question a lot in terms of, should it be SVR 25%, should it be SVR 35%, 35% reduction in spleen volume. The FDA were really clear with us that what they want to see are endpoints that are meaningful for patients and are relevant for the mechanism of our drug. There will be in the secondaries, lots of hard endpoints with blood volume -- with the spleen size and with blood counts, for example, even overall survival in the secondaries. But the primary endpoint is TSS50. Within the TSS50, one of the domains is abdominal discomfort. One of those -- a lot of the significant symptoms that patients suffer from are as a result of spleen volume. So you wouldn't expect to see a positive TSS50 unless you also saw a reduction in spleen volume. I take the point that they are -- that this is a patient-reported outcome and therefore, could be seen as being subjective and that you will see potentially a placebo effect. But that's why we size the study the way that we have. So we believe that the number of patients we have in will overcome any placebo effect that we see. We've looked at earlier studies with other drugs in myelofibrosis and looked at the size of the placebo effect on symptom score in those. And we've adopted that in terms of saying -- assuming that we would get the same or slightly bigger placebo effect in our studies when we thought about the powering of the study going forward. So it's a good question. It's a relevant concern, but it's one that we've taken into full account when we're thinking about the design of the study. And as I said, spleen volume, albeit measurable, doesn't necessarily lead to a really big impact with either clinicians or spleen volume isn't measured when you go to the clinic with from myelofibrosis to a hematology clinic. Lots of the drugs which are now struggling a bit in development and ones that have fallen over quite recently have been where they've seen quite strong spleen volume reduction, but they haven't managed to achieve symptom score improvement, not in a significant way. So our drug again stands out because of that really significant -- the thing which really, really hit the most is the TSS50. So that's giving us a lot of confidence going into the next stage, and it's an attractive thing for potential partners.

The next question is, what would you say is stopping big pharma companies from partnering with Syntara at this stage? Or what would you say they are looking for in particular?

I don't think there's anything -- I mean, the thing that was not stopping them, but one thing that would -- that gave them reason to wait a bit longer was the fact that we hadn't had an FDA review of the Phase IIa data and an agreement on the appropriateness of the next step. We've now got that. So I think we've removed one of the main hurdles to those commercial discussions that we aim to have in the next period. And it's -- there's -- other than that, the thing that would stop engagement is we want to see more data. Now there's a breadth of companies that we talk to. Sure, some of the really large companies might -- they can afford perhaps to sit back and wait and see what happens and say they'd like to see more data and they're not comfortable with the level of risk of taking on a drug, which is going from Phase IIa to Phase IIb. But there are many other companies who see this as an opportunity where they can get involved and pick up because of that perceived increased risk of taking something when it's got earlier data. So -- and I wouldn't say that our drug is early stage either, right? I mean it has Phase IIa data. It's already completed Phase I. It's got through in Phase IIa. We have data in patients. We've got a lot of safety information in patients. And we've got an FDA review of the data package as well. So I think we're now in a good spot.

And related to this, someone else asks, how mature are your discussions with potential funder for the Phase IIb trial? And how much will the trial cost?

So the Phase IIb study with 100 patients is in the order of USD 20 million to USD 25 million. Clearly, from a market cap of AUD 50 million, that's a big chunk of money to find to fund the study. But again, I'd just point to the fact we're a company with multiple milestones ahead of us, lots of opportunity for value increase in the stock and also collaborations -- potential collaborations with partners, not just over amsulostat, but over other drugs in the pipeline as well. So the company has a -- relative to a company that has one asset with one indication and one trial running, what you're looking at here as a company with multiple assets, multiple indications, all of them funded within the cash runway that the company has and lots of opportunity for value appreciation coming up and not only from just stock market realization of value as we present clinical trial data, but also from potentially non-dilutive funding coming in from any of the assets that we are talking about today and what we can do in terms of commercialization of them when we've got the data, which is coming up again within the runway of the cash that we've got now.

Thanks, Gary. That's all the questions in the queue. So I'll just hand it back to you to provide a concluding comment.

Thanks, Matt. Well, very much appreciate people's time on the call this morning. There was a lot to get through. But that's, I think, what you get with Syntara, right? You have a company with a pretty mature asset that's derisked now with Phase II data and a regulatory path forward from the FDA and a number of other assets running behind it now with clear value points coming up within the cash runway we've got after the capital raise. And I'd like to again to send my appreciation to those people who supported the recent capital raise. And I look forward to updating you all as we go through the rest of this year. Thank you, Matt.