Synta Pharmaceuticals Corp. filed for its initial public offering Tuesday, with hopes of using proceeds to advance a growing product pipeline that includes two drugs in Phase II trials for inflammatory disease and cancer.
The Lexington, Mass.-based company estimated in its prospectus it would raise about $115 million, though it has yet to specify the number of shares or the price. New York-based Morgan Stanley would act as managing underwriter, with Lehman Brothers and Lazard acting as co-managers.
Synta seeks to trade on Nasdaq under the symbol "SNTA."
Proceeds would fund clinical and preclinical work, covering corporate expenses and possibly the cost of acquiring or investing in complementary technologies, products or companies. Synta said use of the proceeds would depend upon how quickly the company progresses with development and commercialization efforts.
In November, Synta raised $80 in a fourth private round, bringing its total funding to $196 million since 2001. Synta has reported an accumulated deficit of $95 million to date. Its quarterly report, ending Sept. 30, showed a net loss of $30.7 million over a nine-month period. The company's cash, cash equivalents and marketable securities totaled $56.3 million as of that date.
Synta said it expects operating costs to increase as candidates move through clinical trials. Additional staff also will be needed.
During the nine-month period ending Sept. 30, the company spent about $18.6 million developing its top three drug candidates, and $5.7 million on early stage programs.
Synta has seven products in clinical and preclinical development, including STA-5326, an orally available small-molecule drug, designed to treat Crohn's disease and psoriasis by inhibiting the proteins interleukin-12 and interleukin-23. The drug is in Phase II trials and results are expected later this year. The company said it hopes to initiate a Phase III trial by the end of 2005.
If approved, Synta said, STA-5326 would compete against products such as methotrexate and the psoriasis drugs Remicade (Centocor Inc.) and Enbrel (Amgen Inc.).
Synta said it also plans to evaluate STA-5326 for the treatment of rheumatoid arthritis and multiple sclerosis.
The company's second product, STA-4783, is in Phase II trials for non-small-cell lung cancer, malignant melanoma and soft-tissue sarcoma, in combination with anticancer taxanes.
STA-4783 is designed to induce expression of heat-shock protein-70 on the surface of tumor cells, marking cells to be destroyed by the immune system. Synta said preclinical studies indicate that the drug is more effective than taxane alone and has minimal toxicity. The company said it expects to have data to begin a Phase III trial by the end of the year.
Last year, Synta began two Phase I trials for its small-molecule cancer drug, STA-5312, designed to treat chemotherapy-resistant cancers by inhibiting the assembly of microtubules and disrupting cell division. Results from the trials, focusing on solid tumors and refractory and relapsed blood cancers, are expected later this year.
The company also is developing ion channel modulators, such as calcium release-activated calcium (CRAC), transient-receptor potential (TRP) and other channels, for treatment of asthma, transplant rejection, allergies and cancer.
Synta's drug discovery platform is based on a chemical compound library, medicinal chemistry and a high-throughput chemical biology approach. It identifies drug candidates by using chemical structures as molecular probes in cell-based assays.
In September 2002, Synta acquired Principia Associates, which previously acquired SBR Pharmaceuticals - formerly Shionogi BioResearch Corp., the U.S. subsidiary of Osaka, Japan-based Shionogi & Co. Ltd. With that acquisition, Synta obtained a chemical compound library, a set of drug discovery capabilities and a pipeline of preclinical candidates.