On August 11, 2022 Synthetic Biologics, Inc. (NYSE American: SYN), a diversified clinical-stage company developing therapeutics designed to treat diseases in areas of high unmet need, reported financial results for the second quarter ended June 30, 2022, and provided a corporate update (Press release, Synthetic Biologics, AUG 11, 2022, View Source [SID1234618164]).

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"We are pleased with the steady progress that continues to support the advancement of our novel OV platform and further underscores the potential value of our lead candidate, VCN-01, designed to address devastating cancers with high unmet need through a differentiated and potentially transformative mechanism of action," said Steven A. Shallcross, Chief Executive Officer of Synthetic Biologics. "We have made the strategic decision to rationalize our spend and prioritize our oncology program, which is expected to extend cash runway into the first quarter of 2024. We believe this sharpened approach has the potential to drive near-term value for our shareholders and propel us forward to key milestones, including the initiation of our Phase 2 study in patients with metastatic pancreatic adenocarcinoma in the fourth quarter of 2022 and our Phase 2/3 study in retinoblastoma in the second half of 2023."

Recent Program Developments:

The acquisition of VCN Biosciences transformed Synthetic Biologics’ pipeline with the addition of VCN’s lead clinical-stage drug candidate, VCN-01, an intravenous oncolytic adenovirus (OV), as well as preclinical stage VCN-11, which incorporates a proprietary albumin binding domain in the virus shell which is intended to improve systemic delivery by enabling the virus to coat itself in albumin and thereby evade neutralizing antibodies (NAbs).
Initiated the investigator sponsored Phase 1, open-label, non-randomized clinical trial evaluating VCN-01 in combination with mesothelin-directed lentiviral transduced human chimeric antigen receptor modified T cells (huCART-meso) for patients with pancreatic and serous epithelial ovarian cancers (NCT05057715).
Corporate Update:

On July 25, 2022, the Company’s common stock began trading on a split-adjusted basis. The Company’s common stock continues to trade on the NYSE American under the stock ticker "SYN" but under the new CUSIP number 87164U409.
Anticipated Milestones:
VCN-01

Initiation of VCN-01 dosing in an investigator sponsored study of brain tumors at the University of Leeds (H2 2022).
Data from the VCN-01 Phase 1 investigator sponsored study in and head and neck cancer to be presented at a major medical meeting (Q3 2022)
Initiation of a Phase 2 study of VCN-01 in combination with standard-of-care chemotherapy (gemcitabine/nab-paclitaxel) as a first line therapy in newly diagnosed metastatic PDAC patients (Q4 2022).
Initiation of a Phase 2/3 study of VCN-01 as an adjunct to chemotherapy in pediatric patients with advanced retinoblastoma (H2 2023).
SYN-004

Topline data read out from the first cohort of the SYN-004 study in allo-HCT patients (H2 2022) followed by initiation of the second cohort (Q4 2022).
Quarter Ended June 30, 2022 Financial Results

General and administrative expenses increased to $1.5 million for the three months ended June 30, 2022, from $1.3 million for the three months ended June 30, 2021. This increase of 19% primarily comprised of increased consulting and legal costs related to the VCN acquisition, higher insurance costs, audit fees, and public relations expenses and VCN administrative expenses not included in prior year. The charge related to stock-based compensation expense was $86,000 for the three months ended June 30, 2022, compared to $83,000 the three months ended June 30, 2021.

Research and development expenses increased to $3.5 million for the three months ended June 30, 2022, from approximately $1.9 million for the three months ended June 30, 2021. This increase of 80% is primarily the result of VCN research expenses related to VCN-01 not incurred in the prior year and to a lesser extent higher manufacturing expense for SYN-020, costs incurred related to our Phase 1a clinical trial of SYN-020 and expenses related to our Phase 1b/2a clinical trial of SYN-004 (ribaxamase) in allogeneic HCT recipients. We anticipate research and development expense to increase as we plan for and initiate enrollment for our phase 2 clinical trial for VCN-01 in PDAC, phase 2/3 clinical trial in retinoblastoma, expand GMP manufacturing activities for VCN-01, and continue with supporting our VCN-11 and other preclinical and discovery initiatives. The charge related to stock-based compensation expense was $27,000 for the three months ended June 30, 2022, compared to $19,000 related to stock-based compensation expense for the three months ended June 30, 2021.

Other income was $17,000 for the three months ended June 30, 2022 compared to other income of $2,000 for the three months ended June 30, 2021. Other income for the three months ended June 30, 2022 is primarily comprised of interest income of $26,000 offset by an exchange loss of $9,000. Other income for the three months ended June 30, 2021 is primarily comprised of interest income.

Cash and cash equivalents totaled $52.3 million as of June 30, 2022, compared to $67.3 million as of December 31, 2021. Cash and cash equivalents totaled approximately $53.5 million as of August 1, 2022.

On July 29, the company closed a private placement of Series C and Series D convertible preferred stock with MSD Credit Opportunity Master Fund, L.P. Total gross proceeds from the offerings, before deducting discounts, financial advisor fees and other estimated offering expenses, were $3 million.

Conference Call

Synthetic Biologics will host a conference call at 8:30 a.m. ET today to review second quarter 2022 operational highlights and financial results. Investors may participate in the live call via telephone by dialing (800) 289-0571 (domestic) or (929) 477-0324 (international) and using the conference ID: 7145566. Participants are asked to dial in 15 minutes before the start of the call to register. Investors and the public can access the live and archived webcast of this call via the "News & Media" section of the company’s website, View Source, under "Events" or by clicking here, for 90 days after the call.