SNGX: Meeting with FDA to Discuss Refusal to File Letter…
NASDAQ:SNGX
READ THE FULL SNGX RESEARCH REPORT
Business Update
Type A Meeting with FDA Scheduled to Discuss RTF for HyBryte™
On April 3, 2023, Soligenix, Inc. (NASDAQ:SNGX) announced the U.S. Food and Drug Administration (FDA) has granted a Type A meeting to discuss the contents of a refusal to file (RTF) letter previously issued by the FDA in regards to the company’s new drug application (NDA) for HyBryte™ (SGX301, synthetic hypericin) for the treatment of early stage cutaneous T cell lymphoma (CTCL). The meeting minutes should be available by the end of April 2023.
The company had previously completed a Phase 3 clinical trial of HyBryte in patients with CTCL. The FLASH (Fluorescent Light Activated Synthetic Hypericin) trial was a randomized, double blind, placebo controlled study that enrolled 169 patients (166 evaluable) with either Stage IA, IB, or IIA mycosis fungoides (the most common type of CTCL) (NCT02448381). The results of the trial were published in the Journal of the American Medical Association (JAMA) Dermatology (Kim et al., 2022).
The trial consisted of three treatment cycles, with each cycle lasting eight weeks. Each study subject had three target lesions treated during the trial. In Cycle 1, patients were randomized 2:1 (n=116 for SGX301; n=50 for placebo) to receive twice weekly treatment of either 0.25% SGX301 or placebo (an ointment with the same light exposure as for SGX301) for six weeks, with treatment response determined at the end of the eighth week. In Cycle 2, all subjects received 0.25% SGX301 on their target lesions, and for those that decided to continue in the trial there was a third treatment cycle where 0.25% SGX301 was applied to all of the patient’s lesions.
The results for Cycle 1 showed a statistically significant treatment response in the Composite Assessment of Index Lesion Score (CAILS) primary endpoint assessed at 8 weeks with 16% of patients receiving SGX301 responding compared to only 4% receiving placebo responding (P=0.04).
In Cycle 2, a total of 155 patients received 0.25% SGX301 on their target lesions (110 receiving 12 weeks of SGX301 and 45 receiving six weeks of placebo treatment followed by six weeks of SGX301 treatment). The results of Cycle 2 showed that continued treatment out to 12 weeks resulted in increased efficacy as shown by a 40% responder rate (P<0.0001 compared to both placebo and six-week treatment data). Response rates further improved in Cycle 3 with 49% of patients electing to receive SGX301 for 18 weeks demonstrating a 50% or greater reduction in the combined CAILS. (P<0.0001 compared to the end of Cycle 1).
Importantly, after 12 weeks of treatment with HyBryte, there is a similar response on both patch (37% response; P=0.0009) and plaque (42% response; P<0.001) lesions when compared to Cycle 1 placebo lesion responses.
HyBryte is a safe and well tolerated CTCL treatment that shows positive effects in a relatively short period of time and has increasing efficacy with continued use. Since CTCL is a long-lasting condition, safety and tolerability are at the forefront of prescribing physicians' concerns when treating patients, and many other CTCL therapies have a number of potential serious side effects, particularly with extended use. We believe the data that Soligenix has compiled for SGX301 in treating CTCL positions it as a promising front-line therapy for a large percentage of patients.
The company is planning to commercialize HyBryte in the U.S. in lieu of seeking a commercialization partnership. Since the CTCL market is a specialized market, Soligenix can cost effectively market the drug with a launch cost of less than $10 million. This way, the company is able to keep 100% of the drug’s value. For overseas markets, we anticipate a commercial partnership and the company is currently in discussions with potential partners. Approval will be sought first in the U.S. followed by other key markets worldwide.
In September 2022, Soligenix announced a $2.6 million Orphan Products Development grant by the U.S. FDA was awarded to an academic institution that was a leading enroller in the FLASH study. The purpose of the grant is to evaluate HyBryte™ for the expanded treatment of patients with early-stage CTCL, including its potential for at-home use. The clinical study will be an open label, multicenter trial that will enroll approximately 50 patients that participated in the Phase 3 FLASH study. Patients have the potential to be treated for up to 12 months with twice a week dosing. The primary endpoint for the study will be evaluating the number of treatment successes, which are defined as ≥50% reduction in the cumulative CAILS score from baseline to the end of treatment. The trial is likely to initiate in the first half of 2023.
Phase 2 Trial in Psoriasis Underway
In December 2022, Soligenix announced that patient enrollment had opened for the Phase 2a trial of SGX302 for the treatment of mild-to-moderate psoriasis. The trial, titled “Phase 2 Study Evaluating SGX302 in the Treatment of Mild-to-Moderate Psoriasis”, will be a randomized, double blind, placebo controlled study that will enroll up to 32 patients age 18 years or older with mild to moderate, stable psoriasis covering 2% to 30% of their body. Placebo or SGX302 (randomized 1:1) will be administered twice weekly for up to 18 weeks, with each treatment consisting of application of therapy followed approximately 24 hours later with visible light activation. The efficacy endpoints for the trial will include lesion clearance along with patient quality of life indices. Topline results are anticipated in the second half of 2023.
Financial Update
On March 31, 2023, Soligenix announced financial results for 2022. The company reported revenues of $0.9 million for 2022, compared to $0.8 million for 2021. The revenues include third party licensing and government contracts and grants awarded in support of RiVax®, the ricin toxin vaccine candidate; SGX943 for the treatment of emerging and/or antibiotic-resistant infections; and CiVax™, the vaccine candidate for the prevention of COVID-19. R&D expenses were $7.9 million in 2022, compared to $8.2 million for 2021. The decrease was primarily due to the conclusion of the CTCL and oral mucositis Phase 3 studies. G&A expenses in 2022 were $6.7 million compared to $5.0 million in 2021. The increase was primarily due to increased legal fees associated with the Emergent arbitration.
Soligenix exited 2022 with approximately $13.4 million in cash and cash equivalents. As of March 24, 2023, and following a 1-for-15 reverse stock split, Soligenix had approximately 2.9 million shares outstanding, and when factoring in stock options, warrants, and the potential convertible debt the fully diluted share count is approximately 3.28 million.
Conclusion
We look forward to hearing the outcome of the company’s Type A meeting with the FDA regarding the RTF for the HyBryte NDA and what additional steps the company will need to take in order to resubmit the NDA. In addition, we look forward to the topline results for the Phase 2a trial of SGX302 in mild-to-moderate psoriasis in the second half of 2023.
We have made a number of changes to our valuation model. Until we get further clarity on the issues brought up by the FDA in regards to the HyBryte NDA we have decreased the probability of approval for HyBryte to 75%. The company currently has sufficient capital to fund operations into the third quarter of 2023, however given the difficult market conditions for financing we have increased the discount rate in our model to 15%. After taking into account those changes and the reverse split our valuation is now at $17 per share.
SUBSCRIBE TO ZACKS SMALL CAP RESEARCH to receive our articles and reports emailed directly to you each morning. Please visit our website for additional information on Zacks SCR.
DISCLOSURE: Zacks SCR has received compensation from the issuer directly, from an investment manager, or from an investor relations consulting firm, engaged by the issuer, for providing research coverage for a period of no less than one year. Research articles, as seen here, are part of the service Zacks SCR provides and Zacks SCR receives quarterly payments totaling a maximum fee of up to $40,000 annually for these services provided to or regarding the issuer. Full Disclaimer HERE.
