SAN FRANCISCO - When Synta Pharmaceuticals Corp. emerged from stealth mode last March, the company did so in a big way, disclosing the second-largest financing - $75.3 million - by a privately held firm in about two years.
It was all about the pipeline.
Now, Lexington, Mass.-based Synta's compounds in development have drawn another $50 million financing round, expected to be disclosed today as the company presents at the JPMorgan Healthcare Conference.
"We have investors that are not traditional [venture capital firms], and are very long term," said Safi Bahcall, Synta's CEO, estimating the current cash gives the firm two years to three years of operating capital.
The fund raising brings to more than $180 million the amount raised by Synta since its inception in 1997, with more than $120 million of that amount garnered in the past year and a half.
It's still all about the pipeline. Synta has full rights to 10 small-molecule programs, two of which - currently in Phase II trials - have blockbuster potential, Bahcall said.
"There's a big difference between a company that owns 100 percent of a $1 billion or $2 billion drug and a company that owns 10 percent," he noted.
In a Phase IIa trial for Crohn's disease, STA-5326 is a first-in-class, oral inhibitor of interleukin-12, a cytokine implicated in autoimmune diseases that include rheumatoid arthritis, psoriasis and multiple sclerosis. Trials in more indications are planned for later this year.
In Phase II for non-small-cell lung cancer is STA-4783, a small molecule that selectively induces the expression of heat-shock protein-70 on tumor cells to bring about an immune-mediated attack. The drug has shown promise in animals when combined with such taxanes as Taxol (paclitaxel), and more Phase II trials are in the planning stage.
In two Phase I trials for hematological malignancies is STA-5312, described as a small-molecule cancer agent that has shown benefit in animals against a variety of chemotherapy-resistant tumors.
Synta uses synthetic chemistry for lead generation and optimization, adding computer-assisted drug design and chemoinformatics to push the process along. The company boasts a chemical library with "highly drug-like compounds assembled over two decades from nontraditional, noncombinatorial sources."
Synta was established after a buyout of the oncology and immunology business of the Japanese drug company Shionogi BioResearch, the U.S. subsidiary of Osaka-based Shionogi & Co. Ltd., which had put together - with help from Fuji Immunopharmaceuticals, a division of the giant photo company - the library of compounds taken from such sources as dye and photography.
"In 1997, that was sold to Merck KGaA [of Darmstadt, Germany], but a lot of the team left and started another joint venture with Shionogi," Bahcall told BioWorld Today. "This is a group that's worked together for over 10 years in developing drugs and came from a pharmaceutical company. It's not a start-up or university driven."
But the origin of the company goes back to the early 1980s, when Synta's scientific founder, Lan Bo Chen, professor of pathology at Harvard Medical School, began assembling a chemical compound library "from very unusual sources," Bahcall said.
"If you take a look at compounds that are on-market therapeutics, you'll find many closely related chemical structures in very good photographic libraries," he said.
"We have six compounds in optimization or earlier stage in a number of different programs, one of which is ion channels," Bahcall said.
"There's a huge industry that's developed in applying ion channel technology to treat cardiac and central nervous system indications," he pointed out, but Synta's ion channel platform builds on new sets of proprietary targets.
Whereas existing ion channel drugs target channels in electrically excitable cells such as cardiac cells and neurons, the newly discovered channels are expressed in the nonexcitable cells of the body, including immune and epithelial cells - and Synta aims to come up with the first modulators against those new targets.
Meanwhile, both of the Phase II products represent "the next wave" in their respective therapeutic areas, Bahcall said. In immunology, the next drugs will be oral, targeted therapies. In cancer, Synta's drug "lights up tumor cells to the immune system, so it has the potential to enhance any type of immunotherapy - antibodies, vaccines," he said. "It makes the immune system see tumor cells."
The next trend in cancer treatment will be similar to HIV therapy, an "immuno-cocktail," Bahcall predicted. "It's a number of drugs together that get the immune system to fight tumors."
Participants in the latest financing round included the following, all of New York: Caxton Group, Gollust Management, DuQuesne Capital and Galleon Group. Also aboard were Mountain Trail Investments and AIG SunAmerica, both of Los Angeles, along with other undisclosed institutional and individual investors.
The JPMorgan conference "is definitely more upbeat than last year," Bahcall said, pointing to two trends.
"One is, the market is getting much more discerning and smart," he said. "They're looking for quality products, quality clinical trials, quality clinical data. There's no interest in hype or B.S."
Another trend is the ever-sharpening focus on products. "There's much less interest in snazzy technologies," Bahcall said. "The rich, in terms of having products, are going to get richer. The poor, in terms of having no products, are going to get poorer."
The conference continues through Thursday.