Synthetic Biologics at the Forefront of Gene Therapy's Comeback

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Synthetic Biologics SYNThere is now growing renewed interest in gene therapy as several recent successful clinical trials have now overcome prior technical challenges in the space. Gene therapy involves treating disease by introducing new therapeutic DNA into a patient, which DNA is then capable of continuous local production of a therapeutic protein right where it is needed in the body. As such, gene therapy holds out the promise to not only treat, but in effect, cure many diseases.

Synthetic Biologics, Inc. (SYN), which focuses on the development of synthetic DNA-based therapeutics and innovative disease-modifying medicines for serious illnesses, believes gene therapy is on the brink of a major technical breakthrough. The company is working on a synthetic DNA-based therapy for the treatment of pulmonary arterial hypertension (PAH), and hopes to add additional synthetic DNA programs in the near-term. In addition, the company has several other investigational drug programs in the clinic to develop treatments for multiple sclerosis (MS), amyotrophic lateral sclerosis (ALS), and fibromyalgia.

"We believe that gene therapy is at the beginning of its second inflection point," says Jeff Riley, CEO of Synthetic Biologics. "About 10 years ago, gene therapy had its first inflection point, and we feel strongly that a lot of the issues encountered then have been resolved. I truly believe that gene therapy 2.0, as we are calling it, has great potential in the treatment of several medical indications. If the industry moves a couple of gene therapies through the FDA, there will be a significant amount of capital invested back into this field of medicine."

Riley isn't alone in this assessment, noting that several large pharmaceutical companies such as Baxter (BAX), Novartis (NVS), Intrexon Coporation, Genzyme and Sanofi (SNY) are now making big bets again in the gene therapy space.

To provide an idea of the possibilities and potential of what gene therapy is capable of, Riley notes that there are several clinical programs currently in Phase 3 trials to treat ocular diseases.

"Imagine being born and only being able to see for a few years before becoming blind," he said. "It happens to kids at 8 or 9 years old because they're missing a gene that causes them to slowly go blind. In the university trials that are ongoing, physicians are injecting transgenes into the back of the patient's eye and replacing the gene that's missing. This produces the protein that helps cure disease that causes blindness. So you're talking about transformative treatments that really help people's lives, in this case, curing blindness. Once that gets through the FDA, I think there will be a bit of a fire lit in the industry."

DNA-Based Therapy for Pulmonary Arterial Hypertension

The current challenges of treating PAH patients with existing drugs, particularly prostacyclin, is that the systemic side effects severely limit that amount of drug that can be delivered to where it is intended, namely the pulmonary arteries of lungs. The current treatment approach involves dosing the patient with as much drug as they can withstand, then due to side effects such as nausea, diarrhea, jaw pain and others, backing off the dose ever so slightly in order to maximize the amount that can be exposed to the pulmonary arteries. It’s a difficult regimen to tolerate and one that requires placement of a continuous infusion pump typically worn on a patient’s arm for the remainder of a patient’s life.

"What we're working on is delivering a specific gene via a vector directly to where it is needed, the pulmonary artery through a one-time minimally invasive catheter procedure. This will hopefully enable the production of high levels of prostacyclin in the pulmonary arteries with minimal systemic effects, and utilizing Intrexon’s RheoSwitch® oral activator ligand, we should also be able to regulate the amount of prostacyclin produced in the pulmonary arteries to treat the PAH.

In November 2011, Synthetic Biologics executed a worldwide exclusive collaboration with Intrexon Corporation to develop a DNA-based therapy for PAH. "The estimated market PAH drugs is expected to be approximately $3.6 billion by 2015," Riley said. "We chose this indication because it's a highly unmet medical need that we think DNA therapy is uniquely positioned to address, and there's no competing program in gene therapy for PAH."

Intrexon's Chairman and CEO is famed biotech and pharma icon, R.J. Kirk, who made his billions founding and selling successful companies in the industry such as General Injectables & Vaccines, King Pharmaceuticals, New River Pharmaceuticals, and most recently Clinical Data, which sold to Forest Labs for $1.3 billion.

Riley believes that the relationship with Intrexon and Kirk is a validation of both the company and the future of the gene therapy space.

"Our primary targets are medical indications that have few or no treatment options that may benefit from gene therapy," Riley says. "Currently our burn rate is approximately $4 million a year, which is negligible in this space. Going forward, we intend to focus on the gene therapy space, with the belief that this area is at an inflection point where we think in the next two to three years it's going to explode again like it did 10 years ago."

Synthetic Biologics' Clinical Trials for MS and ALS

The market for multiple sclerosis treatments is estimated to grow to $15 billion by 2016, according to RBC Capital Markets, and will be increasingly dominated by oral drugs as opposed to the current injectables. Synthetic Biologics’ investigational oral estriol drug, TrimestaTM, is one of the leading oral drug candidates on the horizon for MS and is currently being evaluated in two Phase 2 clinical trials for the treatment of two MS-related diseases: relapsing-remitting MS in women and cognitive dysfunction in female MS patients.

TrimestaTM focuses on the positive effects of the pregnancy hormone, estriol, on MS. According to Synthetic Biologics, estriol is a natural hormone, similar to estrogen that is produced during pregnancy and has been scientifically documented to reduce symptoms of certain autoimmune diseases, including MS.

"Clinical researchers have observed that when women with MS get pregnant, they have virtual protection from relapses, especially by the third trimester of pregnancy," Riley says. "The remission of MS-related symptoms abruptly ends immediately after giving birth. Then unfortunately, MS relapse rates shoot back up. What we are doing with the pregnancy hormone estriol, is simply recreating the benefits of pregnancy for female MS patients."

He adds that estriol is the weakest of the three predominant female estrogens and has been used outside of the U.S. to treat the symptoms of menopause for decades, but has never been approved in the U.S. for any indication. The company has secured basic patents around estriol for MS and other autoimmune diseases and is currently in clinical development with the intention of trying to obtain FDA approval. Riley says the Phase 2 trial for relapsing-remitting MS, which has 164 patients enrolled, is scheduled to finish patient dosing and monitoring in the first quarter of 2014. This clinical trial is completely funded by non-dilutive clinical grants totaling over $8 million, representing the largest grants ever awarded for any MS drug.

An additional Phase 2 clinical trial to evaluate the effect of Trimesta on cognitive dysfunction in female MS patients initiated enrollment earlier this year. The goal of the trial is to establish efficacy of Trimesta in 64 patients and move forward to a Phase 3 trial, either with a partner or by itself. The majority of the cost of this clinical trial is also being funded by outside charitable foundations.

"These MS clinical trials are very good programs with low risk, and there's really no serious side effects at all since it is a natural hormone," Riley said. "From what we've seen in animal models and the Phase 1/2 trial, it looks very positive that we will see good efficacy in the ongoing Phase 2 trials. Obviously, the NIH and National Multiple Sclerosis Society see the same potential, which is why they are backing the ongoing clinical trials so heavily. The whole MS area is quickly moving to oral treatments, and estriol represents one of the leading oral candidates in the field, making it a very valuable asset.

The company is a leader in the field of zinc biology and is also preparing to begin clinical trials for its zinc-based drug AEN-100, to treat ALS, also known as Lou Gehrig's disease. This study will be conducted by the PNA Center for Neurological Research of Arizona which last year demonstrated dramatic results in ALS using oral high dose zinc in a pilot Phase 1/2 clinical trial The scientific rationale behind this treatment is that Synthetic Biologics’ proprietary, gastroretentive oral high dose zinc-based drug AEN-100 can supply and treat the apparent deficiency of zinc in the central nervous system of ALS patients which appears to be at the center of numerous ALS pathological processes.

"It has been theorized that often, there is too little available zinc in the brain for people suffering Alzheimer's, Lou Gehrig's disease, and potentially Parkinson’s as well," Riley said. "This can be due to genetics and aging, but zinc is essential to over 200 enzymatic processes and is an important neurotransmitter in the brain. Our bodies for the most part do not store zinc, like they do calcium and iron, but instead rely on ready dietary sources, which may not be made available. Absent available zinc, neurons burn out through a process called exicitotoxicity and are also unable to perform necessary repair functions as well. A big clue came less than 10 years ago when the genetic basis of the familial form of ALS was shown to involve a gene essential for proper zinc handling called SOD1."

He adds that the company hopes it will be able to move into a Phase 2 or Phase 2/3 trial for ALS by the end of the year.

The Future of Gene Therapy Through Synthetic Biologics

The opportunity in DNA-based therapy treatments holds such promise that, in addition to support from Kirk, Synthetic Biologics has also added key members to its management team over the past six months that resembles a who's who of industry all-stars.

"We’ve hired people who are gurus in the space," Riley said. "It is an exceptional group of experts, well-positioned to move the company forward."

The company's executive team includes John Monahan, Sr. Vice President of Research & Development, who was the formerly the founder and CEO of gene therapy company Avigen; Evan Ballantyne, Chief Financial Officer, formerly the CFO of Clinical Data; Carol Reed, Sr. Vice President of Clinical & Regulatory Affairs, formerly the CMO of Clinical Data; and Mike Kaleko, Scientific Director, who was formerly the co-head of gene therapy at Novartis.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:


Symbol Name Price Change % Volume
HVT Haverty Furniture Companies Inc. 17.70 -0.30 -1.67 91,065
SYN Synthetic Biologics Inc. 1.50 -0.01 -0.66 322,680


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