Synsorb Biotech Sinks After Synsorb Pk Results
By MARY WEIL
TORONTO -- Synsorb Biotech Inc.'s (SYBB) stock has fallen 28% after test results from its Synsorb Pk E.coli drug showed a limited trend toward efficacy.
The company and its partners will now discuss the next steps with U.S. and Canadian regulatory authorities, said Cindy Gray, a company spokeswoman.
The regulatory authorities could either ask the company to do further trials or could allow Synsorb to submit a new drug application based on the current data, she said.
Although the Phase III trial didn't show efficacy overall in the 526 children who were treated, the sub-section of patients treated within two days of the onset of symptoms did show a statistically significant lower rate of Hemolytic Uremic Syndrome.
Gray said the trial was designed to include children who were treated within five days of developing symptoms and the company didn't see the results it was hoping for. But in the one-third of patients who received the drug within two days of the onset of symptoms, only 7% developed HUS compared with 17% of those taking a placebo.
In Toronto trading Thursday, Synsorb is off 1.64 to 4.31 on about 518,000 shares.
The results were a bit of a wash, said Doug Janzen, an analyst with Loewen Ondaatje McCutcheon Ltd.
"The data was more or less right down the middle. It seems to have an effect in a sub-set of the patient population but I don't believe that interim analysis data will be enough to file for approval," Janzen said.
However, Janzen said he's a little bit surprised by the reaction to the results, as most institutional investors haven't been including Synsorb Pk in the value of the company, instead valuing the company on its other drug - Synsorb Cd.
"The stock is probably slightly oversold at this level," Janzen said, adding he still has a buy rating on the company but doesn't have a target price.
Janzen said he was hoping the results would give the company direction for its E.coli program, but they didn't.
"We didn't get any answers. A lot of people were hoping with this interim analysis we could either have a firm timeline on what to do with Synsorb Pk or they'd can the program, and this came right down the middle," Janzen said.
Synsorb Biotech Inc. (SYBB) recently made the news after supplying Synsorb Pk to children in Walkerton, Ont., where several people died from drinking water contaminated with E.coli bacteria in May.
At least seven people died and about 2,000 became ill because of the water. Health Canada approved shipments of Synsorb Pk on compassionate grounds even though the product hasn't been approved.
Doug Janzen, analyst with Loewen Ondaatje McCutcheon Ltd., suggested some investors may have gotten into the stock at that time, only to be selling now.
Synsorb's other drug under development is Synsorb Cd, a potential treatment for recurrent C.difficile antibiotic associated diarrhea, a common hospital acquired infection.
Janzen said Synsorb Pk does serve an unmet medical need, as there's no other treatment for E.coli, but he questioned if the patient population is large enough to make developing the drug worthwhile.
He added that, because Synsorb Pk is pretty benign as far as side effects are concerned, doctors might still prescribe it even if the onset of symptoms was three, four or five days earlier.
"The product will probably do better in the marketplace than it will in the clinical setting," Janzen said.
For Synsorb Pk, Synsorb is partnered with Paladin Labs Inc. (T.PLB) in Canada, with Takeda Chemical Industries Ltd. (J.TKD) in Japan and with Tramedico International BV in part of Europe.
The company is looking for partners in the U.S. and in other parts of Europe, said Cindy Gray, a company spokeswoman.
Synsorb plans to find third-party funding from current or future partners if additional trials are needed, Gray said.
Company Web site: synsorb.com
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