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Synthetic Biologics Reports Year End 2013 Financial Results and Operational Update

March 31, 2014

– Conference Call Today, March 31, 2014, at 10:00 a.m. (EDT) –

ROCKVILLE, Md., March 31, 2014 /PRNewswire/ — Synthetic Biologics, Inc. (NYSE MKT: SYN), a developer of novel anti-infective biologic and drug candidates targeting specific pathogens that cause serious infections and other diseases, today reported financial results for the year ended December 31, 2013 and provided operational highlights.

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Recent Operational Highlights

Relapsing-Remitting Multiple Sclerosis (RRMS) – Trimesta(TM) (oral estriol)

    --  Patients in the Phase II clinical trial evaluating Synthetic Biologics'
        drug candidate, Trimesta(TM), in combination with Teva's Copaxone®
        (glatiramer acetate injection) for the treatment of RRMS under an
        investigator-initiated IND, completed their final 24-month visits during
        January 2014. Available MS therapies demonstrate anti-inflammatory
        and/or immune-modulatory responses but are not considered
        neuroprotective. Based on previous research findings,([i]) Trimesta(TM)
        may offer both inflammatory and neuroprotective benefits for patients
        with MS when taken in combination with Teva's Copaxone®.
        --  Rhonda Voskuhl, M.D., the lead investigator of the trial is
            scheduled to present topline results at the American Academy of
            Neurology's (AAN) 66(th) Annual Meeting in Philadelphia on April
            29-30, 2014.

Prevention of C. difficile (C. diff.) Infections – SYN-004 Oral Enzyme

    --  Manufacturing is underway to support preclinical and clinical trials of
        SYN-004, Synthetic Biologics' lead anti-infective product candidate,
        which is believed to be the first and only therapy designed to
        potentially prevent the devastating effects of C. diff. The Center for
        Disease Control and Prevention (CDC) has classified C. diff as an
        "urgent public health threat"([ii]), surpassing Methicillin-resistant
        Staphylococcus aureus (MRSA) as the number one hospital-acquired
        infection in the United States. C. diff is a multidrug-resistant
        bacterium that infects 1.1 million U.S. patients annually([iii]).
        --  Plans remain on schedule to initiate a 28-day bridging toxicology
            study of the Company's second generation candidate late in the
            second quarter of 2014. Synthetic Biologics expects to file an IND
            and to initiate Phase Ia and Ib clinical trials during the second
            half of 2014 for its C. diff program.

Pertussis (Whooping Cough) – Monoclonal Antibody (mAb)

    --  Synthetic Biologics is working with Intrexon Corporation (NYSE: XON),
        and its academic collaborator, The University of Texas at Austin, on a
        combination of two humanized antibodies designed to neutralize pertussis
        toxin, a major cause of pertussis-mediated infant morbidity and
        mortality. Bench studies demonstrated high affinity binding to the
        toxin, as well as potent neutralization of the toxin. In addition, the
        antibodies were highly efficacious in a murine model of pertussis in
        which they mitigated elevations of white blood cell counts that are
        characteristic of the illness.
        --  As part of the Company's IND-enabling studies, it initiated a pilot
            study in the first quarter of 2014 utilizing the antibody
            combination in a non-human primate model, which in addition to the
            murine model, is supportive of the development of a pertussis
            therapeutic. Synthetic Biologics is currently planning a
            confirmatory follow-up study, and expects to report topline results
            during the second quarter of 2014.

Constipation-Predominant Irritable Bowel Syndrome (C-IBS)

    --  In December 2013, Synthetic Biologics entered into a worldwide exclusive
        license agreement with Cedars-Sinai Medical Center (CSMC) for the right
        to develop products for therapeutic and prophylactic treatments for
        acute and chronic diseases. The Company licensed and optioned from CSMC
        a portfolio of intellectual property for various fields of use,
        including C-IBS, obesity and diabetes. An investigational team led by
        Mark Pimentel, M.D. at CSMC has discovered that these products are
        intended to target the production of methane gas by certain pathogenic
        gastrointestinal microorganisms that are perceived as the underlying
        cause of gas, pain and constipation associated with C-IBS, as well as
        diseases such as obesity and type 2 diabetes.
        --  Initially the Company will focus on the development of an oral
            treatment to reduce the impact of methane producing organisms on
            C-IBS. Synthetic Biologics intends to initiate in
            vivo/pharmacokinetic/pharmacodynamic studies in the first half of
            2014, and to initiate a Phase II clinical trial during the second
            half of 2014.

“Over the past two years, Synthetic Biologics has built a strong pipeline of novel anti-infective biologic and drug candidates targeting specific pathogens, such as C. diff, b. pertussis, methanogens and Acinetobacter. We believe that the Company is well positioned to achieve several key milestones during 2014, and should create significant shareholder value,” stated Jeffrey Riley, CEO of Synthetic Biologics. “Relevant to a topic gaining increased awareness in the healthcare community, two of the Company’s compounds in development are designed to protect the microbiome. When the natural balance of the millions of bacteria in the gut microbiome is disrupted, a person’s health can be compromised. We believe we have solutions.”

Mr. Riley concluded, “We look forward to the AAN Annual Meeting at the end of April, when Dr. Rhonda Voskuhl will present topline results from the Phase II clinical trial evaluating Synthetic Biologics’ oral estriol compound. This represents an important milestone for the Company, and for the potential development of a treatment for MS patients.”

Year Ended December 31, 2013 Financial Results

General and administrative expenses increased to $5.8 million for the year ended December 31, 2013, compared to $5.0 million for the same period in 2012. The increase of 16% is primarily the result of bad debt expense of $763,000 associated with the determination that the note and interest receivable from the sale of Adeona Clinical Laboratory is uncollectible. Charges related to stock-based compensation were $1.3 million for the year ended December 31, 2013, compared to $1.5 million for the same period in 2012.

Research and development expenses decreased to $6.5 million for the year ended December 31, 2013, compared to $12.3 million for the same period in 2012. The decrease of 47% is primarily the result of recording non-cash charges including, the fair value of the common stock issued to Intrexon as consideration for the infectious disease collaboration ($7.8 million) and the fair value of the common stock issued for the acquisition of the C. difficile program assets ($1.2 million). The decrease in research and development expenses for the year ended December 31, 2013 was off-set by increases in employee costs and program costs associated with the Company’s infectious disease programs. Charges related to stock-based compensation were $375,000 for the year ended December 31, 2013, compared to $400,000 for the same periods in 2012.

Other income was $21,000 for the year ended December 31, 2013, compared to $15,000 for the same period in 2012.

Cash as of December 31, 2013 was $14.6 million, compared to $10.0 million as of December 31, 2012. As of March 27, 2014, the Company’s cash balance was approximately $11.3 million.

Conference Call

Synthetic Biologics will hold a conference call today, Monday, March 31, 2014, at 10:00 am EDT. During the call, Jeffrey Riley, Synthetic Biologics’ Chief Executive Officer, will provide a brief update of the Company’s multiple sclerosis program and its anti-infective drug pipeline for infections and other diseases, including the prevention of C. difficile infections, reducing the impact of methane producing organisms on constipation-predominant irritable bowel syndrome (C-IBS) and the treatment of Pertussis. C. Evan Ballantyne, Synthetic Biologics’ Chief Financial Officer, will review the Company’s financial results for the year ended December 31, 2013.

Interested parties should call 1-877-870-4263 (U.S. toll free), 1-855-669-9657 (Canada toll free), or +1 412-317-0790 (International), fifteen minutes before the start of the call to register. Registered callers on the toll free line may ask to be placed in the queue for the Question & Answer Session. The call will also be webcast over the Internet at http://www.videonewswire.com/event.asp?id=98657. If you are unable to participate during the live conference call, the webcast will be available for replay at the same URL, http://www.videonewswire.com/event.asp?id=98657 for 30 days after the call.

About Synthetic Biologics, Inc.

Synthetic Biologics, Inc. (NYSE MKT: SYN) is a biotechnology company focused on the development of novel anti-infective biologic and drug candidates targeting specific pathogens that cause serious infections and other diseases. The Company is developing an oral treatment to reduce the impact of methane producing organisms on constipation-predominant irritable bowel syndrome (C-IBS), an oral biologic to protect the gastrointestinal microflora from the effects of IV antibiotics for the prevention of C. difficile infection, a series of monoclonal antibodies for the treatment of Pertussis and Acinetobacter infections, and a biologic targeted at the prevention and treatment of a root cause of a subset of IBS. In addition, the Company is developing an oral estriol drug for the treatment of relapsing-remitting multiple sclerosis (MS) and cognitive dysfunction in MS. For more information, please visit Synthetic Biologics’ website at www.syntheticbiologics.com.

Copaxone® is a registered trademark of Teva Pharmaceutical Industries Ltd.

This release includes forward-looking statements on Synthetic Biologics’ current expectations and projections about future events. 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. These statements are based upon current beliefs, expectations and assumptions and are subject to a number of risks and uncertainties, many of which are difficult to predict and include statements regarding advancing the Company’s clinical programs, the Company’s opportunities and its position in the infectious disease market, the anticipated timing and results of the Company’s development efforts and the expected size of the future market for sales of therapies for C. difficile infection, and the Company’s ability to create significant shareholder value. The forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those set forth or implied by any forward-looking statements. Important factors that could cause actual results to differ materially from those reflected in Synthetic Biologics’ forward-looking statements include, among others, a failure to receive the necessary regulatory approvals for commercialization of the Company’s therapeutics, a failure of the Company’s clinical trials, and those conducted by investigators, to be commenced or completed on time or to achieve desired results, a failure of the Company’s clinical trials to receive anticipated funding, a failure of the Company’s monoclonal antibodies for the treatment of infectious diseases to be successfully developed or commercialized, the Company’s inability to maintain its licensing agreements, or a failure by the Company or its strategic partners to successfully commercialize products and other factors described in Synthetic Biologics’ report on Form 10-K for the year ended December 31, 2013 and any other filings with the SEC. 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)

    Condensed Consolidated Balance Sheets

                                                                                                           December 31,
                                                                                                           ------------

                                                                                                             2013              2012
                                                                                                             ----              ----

    Assets

       Cash and cash equivalents                                                                          $14,625            $9,954

       Prepaid expenses and other current assets                                                            1,591             2,509

       Property and equipment, net                                                                             37               223

       Long-term note receivable                                                                                -               700

       Deposits and other assets                                                                                4                37
                                                                                                              ---               ---

    Total Assets                                                                                          $16,257           $13,423
                                                                                                          =======           =======

    Liabilities and Equity

       Current liabilities                                                                                   $142              $395

       Commitments and contingencies                                                                          885                 -

       Synthetic Biologics, Inc. and subsidiaries equity                                                   15,230            13,028
                                                                                                           ------            ------

    Total Liabilities and Equity                                                                          $16,257           $13,423
                                                                                                          =======           =======

    Condensed Consolidated Statements of Operations

                                                                                                     For the years ended
                                                                                                         December 31,
                                                                                                         ------------

                                                                                                             2013              2012
                                                                                                             ----              ----

    Operating Costs and Expenses

       General and administrative                                                                          $5,832            $5,012

       Research and development                                                                             6,507            12,287
                                                                                                            -----            ------

    Total Operating Costs and Expenses                                                                     12,339            17,299
                                                                                                           ------            ------

    Loss from Operations                                                                                  (12,339)          (17,299)
                                                                                                          -------           -------

    Other Income (Expense)

       Interest income                                                                                         33                33

       Other expense                                                                                          (12)              (18)
                                                                                                              ---               ---

    Total Other Income, net                                                                                    21                15
                                                                                                              ---               ---

    Loss from Continuing Operations                                                                       (12,318)          (17,284)

    Income from Discontinued Operations                                                                         -               216
                                                                                                              ---               ---

    Net Loss                                                                                              (12,318)          (17,068)

    Net Loss Attributable to Non-controlling Interest                                                          (1)                -
                                                                                                              ---               ---

    Net Loss Attributable to Synthetic Biologics, Inc. and                                               $(12,317)         $(17,068)

    Subsidiaries

    Net Income (Loss) Per Share - Basic and Dilutive

       Continuing operations                                                                               $(0.27)           $(0.50)

       Discontinued operations                                                                                  -              0.01
                                                                                                              ---              ----

    Net Loss Per Share Attributable to Synthetic Biologics, Inc.                                           $(0.27)           $(0.49)

    and Subsidiaries

    Weighted average number of common shares

    outstanding - Basic and Dilutive                                                                   45,667,813        34,896,592
                                                                                                       ==========        ==========


    ___________________________

    [i] Sicotte, NL, et al. Treatment of Multiple Sclerosis with the Pregnancy Hormone Estriol. Ann Neurol 2002; 52:421-428.

    [ii] U.S. Centers for Disease Control Web site: http://www.cdc.gov/drugresistance/threat-report-2013/pdf/ar-threats-2013-508.pdf#page=51 Accessed: March 26, 2014.

    [iii] This information is an estimate derived from the use of information under license from the following IMS Health Incorporated information service: CDM Hospital database for full year 2012. IMS expressly reserves all rights,
     including rights of copying, distribution and republication.

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SOURCE Synthetic Biologics, Inc.


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