On May 8, 2019 Synthetic Biologics, Inc. (NYSE American: SYN), a late-stage clinical company developing therapeutics that preserve the microbiome to protect and restore the health of patients, reported financial results for the three months ended March 31, 2019 (Press release, Synthetic Biologics, MAY 8, 2019, View Source [SID1234535965]).

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"During the first quarter, we remained keenly focused on executing our strategy to advance our portfolio of GI and microbiome-focused clinical programs," stated Steven A. Shallcross, Chief Executive & Financial Officer of Synthetic Biologics. "Enrollment into our investigator-sponsored Phase 2b clinical trial of SYN-010 in breath methane positive irritable bowel syndrome with constipation (IBS-C) patients is ongoing and we believe we are on track to announce a topline data-readout during the second half of 2019. Importantly, we believe dose-response data derived from this clinical study will further fortify the already well-established clinical data set for SYN-010 and enable regulatory discussions to potentially simplify future registration studies."

Mr. Shallcross continued, "During the first quarter, we continued to pursue our strategy for a potential secondary clinical indication for SYN-004 (ribaxamase) in a specialized patient population which may allow for more narrow and cost-efficient clinical development opportunities. Discussions with key opinion leaders are progressing to determine an optimal development pathway for SYN-004 to reduce the incidence and/or severity of adverse outcomes in allogeneic hematopoietic cell transplant (HCT) recipients. These adverse outcomes include acute graft-versus-host-disease (aGVHD) and colonization of opportunistic pathogens such as vancomycin resistant Enterococci (VRE), each of which are associated with poor outcomes and increased mortality in allogeneic HCT recipients. We believe SYN-004 may provide a distinct benefit to patient outcomes in allogeneic HCT recipients, where gut microbiome damage resulting from prolonged beta-lactam antibiotic use has been linked to the development of aGVHD and colonization by VRE. We look forward to sharing important updates and progress for this potential indication."

Clinical Development and Operational Update

Commenced enrollment in Phase 2b investigator-sponsored clinical study of SYN-010, for the treatment of IBS-C
The Phase 2b clinical study is being conducted by the Medically Associated Science and Technology (MAST) Program at Cedars-Sinai Medical Center and is a 12-week, placebo-controlled, double-blind, randomized clinical trial evaluating two dose strengths of oral SYN-010 (21 mg and 42 mg) in approximately 150 patients diagnosed with IBS-C,
The primary objective for the study will be to determine the efficacy of SYN-010, measured as an improvement from baseline in the weekly average number of complete spontaneous bowel movements (CSBMs) during the 12-week treatment period for SYN-010 21 mg and 42 mg daily doses relative to placebo,
Secondary efficacy endpoints for both dose strengths of SYN-010 will measure changes from baseline in abdominal pain, bloating, stool frequency as well as the use of rescue medication relative to placebo,
A topline data readout is anticipated in 2H 2019,
Cedars-Sinai Medical Center and Synthetic Biologics are co-funding the study. The patent rights covering the use of SYN-010 are owned by Cedars-Sinai Medical Center and are exclusively licensed by Cedars-Sinai Medical Center to Synthetic Biologics;
Continued to evaluate a potential secondary indication for SYN-004 (ribaxamase) to reduce the incidence and/or severity of aGVHD and other adverse outcomes in allogeneic HCT recipients
Identification of key investigators and establishment of clinical protocols are ongoing,
Anticipate initiation of a Phase 1/2 clinical study in allogeneic HCT patients in 2H 2019, contingent upon the identification of a research partner and subsequent Institutional Review Board (IRB) approval;
Evaluated regulatory strategies to advance SYN-020 (intestinal alkaline phosphatase) to and through clinical trials targeting areas of significant unmet medical need, including enterocolitis associated with radiation therapy for cancer
Submitted request for pre-IND meeting with FDA in Q1 2019,
Anticipate filing a US IND application in Q4 2019,
Plan to commence a Phase 1 clinical trial in Q1 2020;
Continued to exercise prudent cash management and financial stewardship
Further reduced cash burn, extending projected cash runway to fund operations through at least the end of Q2 2020;
Quarter Ended March 31, 2019 Financial Results

General and administrative expenses decreased by 30% to $1.1 million for the three months ended March 31, 2019, from $1.6 million for the three months ended March 31, 2018. This decrease is primarily due to decreased stock-based compensation expense related to forfeitures and decreased share price, along with the reduction of investor relations, registration, and legal costs. The charge related to stock-based compensation expense was $65,000 for the three months ended March 31, 2019, compared to $349,000 the three months ended March 31, 2018.

Research and development expenses decreased by 28% to $2.4 million for the three months ended March 31, 2019, from $3.4 million for the three months ended March 31, 2018. This decrease is primarily the result of lower SYN-004 (ribaxamase) indirect program costs for the three months ended March 31, 2019, including salary and related expense reductions resulting from the 2018 restructuring and the fact that no clinical trial activity for SYN-004 (ribaxamase) was ongoing during the quarter, offset by an increase in manufacturing costs for SYN-020. The research and development costs incurred during the quarter were primarily related to the investigator-sponsored Phase 2b clinical study of SYN-010. We anticipate research and development expense to increase in association with the ongoing Phase 2b investigator-sponsored clinical study of SYN-010, a potential Phase 1/2 clinical trial of SYN-004 (ribaxamase) in allogeneic HCT recipients, and the continued development of SYN-020. There was no charge related to stock-based compensation expense for the three months ended March 31, 2019 resulting from the 2018 restructuring, compared to $326,000 for the three months ended March 31, 2018.

Other income was $44,000 for the three months ended March 31, 2019, compared to other income of $2.7 million for the three months ended March 31, 2018. Other income for the three months ended March 31, 2019 is primarily comprised of interest income while the three months ended March 31, 3018 is comprised of non-cash income of $2.7 million from the change in fair value of warrants. The decrease in the fair value of the warrants was due to the decrease in our stock price.

Cash and cash equivalents as of March 31, 2019 was $24.7 million, a decrease of $4.2 million from December 31, 2018.

Conference Call

Synthetic Biologics will hold a conference call today, Wednesday, May 8, 2019, at 4:30 p.m. (ET). The dial-in information for the call is as follows, U.S. toll free: +1 888-347-5280 or International: +1 412-902-4280. Participants are asked to dial in 15 minutes before the start of the call to register. The call will also be webcast over the Internet at View Source." target="_blank" title="View Source." rel="nofollow">View Source An archive of the call will be available for replay at the same URL, View Source, for 90 days after the call.