Synta Pharmaceuticals: Strategy and Pipeline




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Video title: Synta Pharmaceuticals: Strategy and Pipeline
Released on: March 01, 2008. © PharmaVentures Ltd
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In this exclusive interview, Fintan Walton talks to Safi Bahcall, President and CEO of Synta Pharmaceuticals. They begin by discussing Synta's origins, and how the company was established through the research of Harvard and MIT scientists. Safi talks about Synta's lead anticancer product and explains its mechanism of action, as well as reviewing the current state of the company's pipeline. He expands upon the terms of Synta's major agreement with GlaxoSmithKline and the interview concludes with a discussion of Synta's growth strategy.
Synta Pharmaceuticals's origins, portfolio and going public.
Fintan Walton:
Welcome to Pharma ventures business review brought to you by Pharma television the world's first on demand pharmaceutical television channel. We are here in San Francisco recording a series of interviews at the annual JP morgan conference. This conference we originally run by the famous hambrecht and quest bank and is one of the oldest events in biotechnology. Today thousands descend from around the US but also from around the world into San Francisco to do financial deals and recently it's also become a important partnering event. I hope you enjoy the series of interviews we have done from some of the key companies attending this conference. Hello and welcome to Pharmaventures business review here in San Francisco. On this show I have Safi Bahcall who is president and CEO of Synta pharmaceuticals based in lexicon Massachusetts, welcome to the show.
Safi Bahcall:
Thank you very glad to be here.
Fintan Walton:
Safi Bahcall, your company is somewhat interesting in the sense that it was originally a management buyout or spinout out of some of the research activities that Shionogi the Japanese company had. Could you tell us a little about that story and how that how that birth happened?
Safi Bahcall:
Sure and most most biotechnology companies in the united states startup as backed by venture capitalists or with the scientists with an idea typically from university. We really have a different origin and history which lead to actually I think a very different profile of the company and that's something a lot of people have noticed about Synta. But as you say there was sort of ten years of investment by two different Japanese companies in what eventually became Synta. So they invested in developing what was really a US based research subsidiary in collaboration with two scientists one from Harvard and one from MIT to use their chemical compounds, libraries and chemistry expertise combined with a biology expertise of the scientists at Harvard and MIT to set up a research operation in Lexicon Massachusetts and they worked for ten years and developed really a pretty phenomenal discovery.
Fintan Walton:
How big was the actual portfolio at that time?
Safi Bahcall:
They had probably ten projects on going when I got and follow off I got to know the group in Lexington and talked to them about the potential of separating a spin out from the Japanese and becoming an independent company.
Fintan Walton:
And who, how was that financed?
Safi Bahcall:
I had some relationships with individuals in the new York financial community that some that I had worked with in the past and others that I got to know and I talked to them about the opportunity and we put together the capital and did the buyout.
Fintan Walton:
Now the relationship with Shionogi it was basically a clean buyout there is no residual relationship with the originators?
Safi Bahcall:
Yeah it was a clean buyout. We took over the operation, paid them cash and built it up over the last six years, took it public.
Fintan Walton:
Right and you took it public just about a year ago is that correct?
Safi Bahcall:
That's right we went public in February last year.
Fintan Walton:
Right and how what was that like because clearly the market for biotech companies trying to float these days is pretty tough?
Safi Bahcall:
That's right. The market for IPO's is cyclical it goes up and down typically every two or three years. This is sort of at a low point and I am sure will come back in the next year or two but it was it was tough but we got it done.
Fintan Walton:
So that will help you to raise about $50 million?
Safi Bahcall:
That's right we raised $50 million.
Synta Pharmaceuticals's lead anti-cancer compound.
Fintan Walton:
Right so clearly you for the last six years you've had this portfolio of compounds that you had the opportunity to take forward. You've focused on oncology and inflammation that appears to be the two areas that you've got most of your compounds in development, could you tell us about the lead compound because that's quite an interesting compound?
Safi Bahcall:
Sure we have five drugs, three in cancers, three for treating cancers and two for treating inflammatory diseases but we are very very excited about the lead compound which is called the Elesclomol because it's really the first drug in thirty years that's had a really strong positive result in extending survival time the time that patients can survive without the disease getting worse in metastatic melanoma.
Fintan Walton:
And it's it's a combination drug or they were used in combination?
Safi Bahcall:
Well we have a drug called Elesclomol and we are giving it right now in combination with another cancers chemotherapy called paclitaxel and in the future we may combine it with other drugs.
Elesclomol's mechanism of action.
Fintan Walton:
Okay so what is the mechanism of action? What's specific about this particular drug that you use?
Safi Bahcall:
Well that's one of the reasons we are very excited about this drug and as you know we announced last year a very large deal, a record setting deal with a large pharmaceutical GlaxoSmithKline [PharmaDeals ID = 28612] for co developing and co marketing this drug and the mechanism was a big part of that because it really is a new approach I think its pioneering a new way to treat cancers that's very different than the historical approaches of chemotherapy or vaccines or antibodies and the way it works is exploiting kind of a fundamental vulnerability of cancers cells. cancers cells are filled to the brim with these things called the oxygen radicals or reactive oxygen species. Normal cells are not and what our drug does is reach inside the cell and crank up those oxygen radicals even more and because cancers cells are so dangerously close to been filled with the brim with these things when you push it up even more they just can't take it and they self destruct.
Fintan Walton:
Right.
Safi Bahcall:
Where as in normal cells they are perfectly under control. So what you have is a drug that can go inside your body and kill cancers cells and leave normal cells alone in a entirely new way.
Fintan Walton:
Is it targeted in any way or just it works systemically?
Safi Bahcall:
It works systemically and it's really a
Fintan Walton:
So you can work with a range of different cancers?
Safi Bahcall:
That's right and we think it's actually most likely to work with those cancers types that are already high in this oxidative stress and these oxygen radicals and that's melanoma is one example where we have got this terrific results and we are in a big pivotal trial right now but also breast, prostrate, ovarian, pancreatic are also very high oxidative stress cancers.
Fintan Walton:
So is it really you are really targeting the more aggressive cancers or ones which are of the greatest unmet clinical need?
Safi Bahcall:
In fact many of those are the ones that are the most aggressive where typical approaches like chemotherapy or vaccines don't work very well.
Current product pipeline.
Fintan Walton:
Right. So as you've said you have got a number of compounds in development it's always a challenge for a small company to have a wide range of compounds in development of course it stretches resources, how what's your strategy going forward for the remaining compounds that you got in your portfolio?
Safi Bahcall:
Well as you say its possibly our five drugs that we have been blessed with a very rich pipeline, very interesting products that are really first in class or best in class and its impossible for us to develop all of them with just our resources. So our goal is to get a balance portfolio of some programs that are partnered and some programs that we on a hundred percent and so because of that we partnered the lead drug with GlaxoSmithKline which is you know co-development co-marketing arrangement which is very attractive for both of us and the four other drugs we still on a hundred percent.
Synta Pharmaceuticals's partnering with GSK.
Fintan Walton:
So just going back to the partnering with GSK lets make it clear your it's a true co development arrangement you are sharing costs in development clinical development worldwide.
Safi Bahcall:
That's right we share costs of the program worldwide. We co market in the united states so there we have kind of equal say in the marketing and equal contribution to the market.
Fintan Walton:
And you have what percentage of the profits can you share 50% is it?
Safi Bahcall:
It's a 40 to 50 % depending on sales.
Business model and strategies.
Fintan Walton:
Okay. For again for a company like yours you've you've managed to successfully float last year which is important for biotech companies where does that place you strategically going forward and what is your business model going forward for Synta?
Safi Bahcall:
Well we think at the business model has having three elements. There is a kind of core growth, medium and a long term plan and we sort of allocate our resources into each of these three buckets. So our core growth is in our lead drug which we have demonstrated in a well controlled blinded clinical trial works and that's an enormous unmet need, it's just an enormous desperation out there in melanoma doctors and patients and physicians so we are incredible excited to get that drug out there. It will be the first drug in thirty years. So we are very very excited to get that drug out there and that's one of core growth strategy. We then invest in the near term right at the nearer medium term which is really additional indications for the lead drug and then our second and third drugs which are coming along very rapidly behind that one. Then finally invest in kind of a long term growth which is sort of seeding future project projects and we think about the business model has having a good balance portfolio along each of those three three dimensions.
Fintan Walton:
Is it is your aspiration to become a fully integrated pharmaceutical company?
Safi Bahcall:
Absolutely. My job is to get our first drug approved then get our next drug approved and then the next drug after that and then the next drug after that.
Fintan Walton:
In terms of the type of relationship you have with a company like GSK how important is it that a company such as yours retains rights particularly here in the US in terms of strategies going forward?
Safi Bahcall:
Well I think it's actually very important. I think one of the reasons which was GlaxoSmithKline in we had a competitive auction process, a bidding process and one of the reasons we really liked working with them is we had a similar philosophy about how to make deals like this partnerships like this successful and that's to really to align our incentives perfectly or as perfectly as you can and that is we are sharing in the costs we are sharing in the profits from this program. We are equally committed to doing the right thing for patients we have the same values going in and most importantly we have the same vision for the product. So I think we are fully aligned on getting this product to the market as soon as possible and then maximizing the number of patients that can benefit from this drug.
Fintan Walton:
The other thing that commonly happening these days is that smaller companies or emerging pharmaceutical companies biotech companies are been acquired by larger pharmaceutical companies, its more less likely environments become you know either acquire or become acquired, what you prefer to be?
Safi Bahcall:
Well we have always focused on the seven year plan. So our focus in developing the plan and executing the plan is get our first drug approved, get our second drug approved, get our third approved get to billion in sales after which its 2 billion in sales after which its 3 billion in sales and that's what we focus on. Obviously I am a board member and we have board members that have a fully sharing duty to share holders and if offers come along we obviously have to take those seriously in a way they are attracting as a shareholder versus what we think we can do from executing on our plan.
Fintan Walton:
Well Safi Bahcall thanks a lot for coming on the show for us to learn more about Synta pharmaceuticals. Thank you.
Safi Bahcall:
Thank you for having me.
Safi Bahcall
President and Chief Executive Officer
Dr Safi Bahcall co-founded Synta with Dr Lan Bo Chen and has been Chief Executive Officer and a member of the Board of Directors since July 2001, and President since December 2003. He has led Synta from its inception through multiple acquisitions, financings, an IPO, and the establishment of an integrated drug discovery and development organization, including five unique programmes in development. Before founding Synta, Dr Safi Bahcall was a consultant at McKinsey & Company, serving investment banks and pharmaceutical companies on strategy, technology and operations. Dr Safi Bahcall also founded a drug discovery company focused on novel ion channel research, which is now part of Synta. He received his BA summa cum laude from Harvard University, was awarded his PhD from Stanford University in theoretical physics, and was a Miller postdoctoral fellow at University of California Berkeley.
Synta Pharmaceuticals
Synta Pharmaceuticals is a biopharmaceutical company focused on discovering, developing and commercialising novel pharmaceutical products for extending and enhancing the lives of patients with severe medical conditions, including cancer and chronic inflammatory disease. Synta has a unique chemical compound library, an integrated discovery engine, and a pipeline of small molecule drug candidates with novel chemical structures and distinct mechanisms of action.