|Soligenix: 10 Catalysts to Look for in 2014|
|By Brian Wilson - Lead Contributor|
|Wednesday, 04 December 2013 13:33|
On Monday, Soligenix announced the initiation of a Phase II trial for orBec® - a treatment for Chronic GI GVHD (Graft versus host disease). This is a multicenter pilot study that will test the drug in patients who have received a bone marrow transplantation within the last 100 days with documented GVHD. The primary/efficacy endpoint for this trial will be based on response rates to orBec (measured by the severity of GVHD-related symptoms) up to a 16 week treatment window.
Also note that this clinical trial will be partially funded by a $300,000 2-year grant given to Soligenix by the National Cancer Institute (NCI).
The 2014 Catalysts
1.) SGX203 (1H 2014) - Initiation of Phase II portion of Phase II/III trial in Pediatric Crohn’s Disease
2.) OrbeShield (1H 2014) - Presentation of canine (animal/preclinical) data
3.) RiVax (1H 2014) – Initiation of Phase II as vaccine for Ricin toxin
4.) SGX201 (2H 2014) – Initiation of Phase IIb in radiation enteritis
5.) SGX942 (2H 2014) – Phase II data presentation for Oral Mucositis indication
6.) SGX203 (2H 2014) – Phase II data presentation for Pediatric Crohn’s
7.) VeloThrax (2H 2014) – Initiation of Phase I in Anthrax
8.) orBec (2H 2014) – interim Phase II data presentation for cGVHD
9.) OrbeShield (2H 2014) – presentation of NHP data
10.) RiVax (4Q 2014) – feedback for submitted orphan/NIH grants for clinical development
Soligenix is a very small company, but the progress it has made within the last year alone has been impressive. In 2013 – at time of writing – the stock is up 217% after investors cheered the impressive $26.3 M grant that Soligenix secured for OrbeShield.
From our perspective, the company looks interesting as a low-maintenance play on a number of niche markets that have little or no competition. Only SGX942 and SGX203 are being fully funded by Soligenix, which eases the burden on stockholders during the next few years of development.There are also enough developments scheduled throughout 2014 to significantly move the stock price.
Therapeutics Pipeline Review
SGX942 – this is a synthetic peptide that is able to regulate proteins that control inflammation, healing factors, and immune response to bacterial infection. It is being used as a treatment for a very unpleasant disease known as oral mucositis, which is a side effect of chemotherapy/radiation that affects hundreds of thousands of patients per year. The market opportunity for this drug is estimated at $500 M in annual revenues. SGX942 was given fast track designation.
SGX203 – a reformulated dose of BDP (betamethasone-17, 21-dipropionate) used to treat pediatric Crohn’s disease. This is an increasingly common disease caused by chronic inflammation of the bowels, and is seen in thousands of children in the United States (and up to 160,000 worldwide). Based on the company’s estimates, the size of this drug market is approximately $200 M. The only main competitor is Remicade, which has limitations. SGX203 was given orphan and fast track designation.
SGX201 – a reformulated dose of BDP (betamethasone-17, 21-dipropionate) that is being developed as a treatment for radiation enteritis. Enteritis, a term used to describe inflammation of the small intestine, is a common side effect of radiation therapy. Based on incidence and cost of current therapies, we estimate that the size of this target market is about $300 M in revenue. There are no drugs for this specific indication – only methods to manage side effects. SGX201 was given fast track designation.
orBec – a reformulated dose of BDP (betamethasone-17, 21-dipropionate) that will be used to treat GVHD in the gastrointestinal tract. This is a very serious condition that leads to damage in the tract, and is a possible result of bone marrow transplantation. Based on the likelihood of occurrence, we estimate that about 3,000 patients suffer from GI GVHD per year as a result of bone marrow transplantation. Based on this, we estimate a $120 M market potential. orBec was given orphan designation.
Vaccine/Biodefense Pipeline Review
ThermoVax – a technological platform that allows for stabilization of vaccines at higher temperatures through a patented method that “dries” them. Has the most potential utility by governments and large hospitals, who stockpile vaccines to prepare for viral outbreaks.
RiVax – an aluminum-absorbed vaccine for the ricin toxin incorporating ThermoVax technology. Has received >$20 M of support from NIH up to this point, and targets a $200 M market according to estimates. RiVax was given orphan designation.
VeloThrax – an anthrax vaccine that incorporates the ThermoVax technology that was built with highly immunogenic antigens that were engineered at Harvard medical School. This drug has not received orphan or fast track potential, although this is a possibility in the near future (possible 2014). VeloThrax is still a very young product, and has yet to start Phase I trials.
OrbeShield – a reformulated dose of BDP (betamethasone-17, 21-dipropionate) being developed treatment for gastrointestinal acute radiation syndrome (GI ARS) – a condition that can occur as a result of acute exposure to radiation. It has the same formulation as orBec, although the activity of the drug appears to be useful against GI ARS. The OrbeShield program is being supported by a 5-year BARDA contract that gives $26.3 M to the company, and has received both orphan and fast track designation.
SGX101 – a treatment for melioidosis built using the technology of Intrexon corporation.
Financials & Misc.
The company is holding about $6.6 M in cash, although operating losses are only about $1.9 M per quarter. This gives the company until 2H 2014 to add cash to its pile. Soligenix has no long term debt, and most of the liability is in the form of warrants.
It’s also necessary to mention that the company recently made a stock purchase agreement with Lincoln Park Capital, in which the company can sell $10 M worth of common stock to them within the next 36 months. This gives Soligenix an ATM option that single-handedly keeps the company running for another year.
The largest holders of Soligenix common stock according to the most recent 13F filings are NRM Holdings, Sigma Tau, and Intrexon. Intrexon, the synthetic biology company of billionare RJ Kirk, is also vested in Soligenix through the codevelopment of SGX943/SGX101.
See comprehensive quarterly financial data for the company updated on September 30, 2013 on the 10-Q filing here (link)