Synact’s new CEO: “I’m hitting the ground running”
On March 20, SynAct Pharma convened an Extraordinary General Meeting, resulting in a new composition of the Board of Directors. Additionally, Jeppe Øvlesen is regaining the position as CEO with the aim to get the company “back on track”. BioStock reached out to Jeppe and CSO Thomas Jonassen to learn more about the changes and strategic direction.
During the last couple of months, SynAct Pharma has experienced a setback with unexpected study results for its lead asset resomelagon, combined with a lack of communication. Hence, several shareholders, including TJ Biotech Invest ApS (Thomas Jonassen), Goodwind Holding GmbH (jointly controlled by Jeppe Øvlesen, Thomas Jonassen and Thomas Boesen) and Thomas Ringberg, called for an Extraordinary General Meeting to replace the current Board with new members.
The meeting was held on March 20 and resolved in the election of Anders Kronborg as new Chairman of the Board, and Sten Scheibye, Sten Sørensen and Jeppe Øvlesen as new Board members. The Board’s primary objective is to execute on a strategy to get SynAct Pharma “back on track” after a rather turbulent period in the company.
Jeppe Øvlesen appointed CEO – again
The strategy is beginning with the appointment of Jeppe Øvlesen as the CEO, succeeding Torbjørn Bjerke effective immediately due to a disagreement over the company’s strategy. Jeppe Øvlesen was CEO of SynAct Pharma from 2015 to 2023. A year after stepping down from the position, he has now returned. BioStock reached out to Øvlesen to delve deeper into the reasons behind the decision to return as CEO.
Jeppe, what led you to get involved in SynAct Pharma as CEO again, and how can you contribute?
– I left SynAct Pharma at a stage where we were expecting to move the clinical development toward the end of phase II (proof of concept). At that stage, a biotech company will typically transform into a different organisation, with more complex clinical trials, more focus on regulatory aspects, a bigger organisation and all in all a different ball game. With the recent setback, we have to realise that SynAct Pharma should not transform now, but rather continue to be a lean and agile organisation. We have a very experienced team, with people that I know very well and that I trust are fit for the challenges to come.
– I was involved in bringing SynAct on the main market, thus I know the procedures in place and can hit the ground running. Time is of essence, the most important thing is to execute on the plans, but we all know that this will also require additional financing, and I know that ball game very well.
»I was involved in bringing SynAct on the main market, thus I know the procedures in place and can hit the ground running. Time is of essence, the most important thing is to execute on the plans, but we all know that this will also require additional financing, and I know that ball game very well.«
– Finally, I would like to say, that I have the deepest respect for SynAct’s owners. SynAct Pharma is a unique biotech company with thousands of shareholders. I am now responsible for us doing our outmost, so that they will get a return on their investment.
You mentioned that you will be hitting the ground running. What are the next steps?
– After the EGM, we have had a Board meeting, and the Board has constituted themselves, so we are fully compliant with regulations. Within management, we will propose a strategy in detail that needs to be endorsed by the Board; this includes looking at the financial situation, and the operating costs moving forward. Of course, we have been discussing the top-level plans for some time now, but the devil is in the detail, so we cannot communicate before this has been settled.
– That being said, we want to have a constructive dialog with the CRO we have used for the EXPAND and RESOLVE studies, so they can be wrapped up and added to the clinical data package for resomelagon. We also want to initiate the next clinical study with resomelagon as soon as possible. building on the knowledge, that we have obtained until now – including the EXPAND and RESOLVE studies.
Could you provide details on the study?
– It will be a dose range phase IIb proof of concept study which will hopefully pave the way for further development of the compound. Therefore, I have challenged the team to set the goal of filing our clinical trial application including in the US, under the existing IND, to the authorities before the summer, as we had originally planned for. If we are successful, we will then be aiming at getting data from the study in Q3 2025.
»I have challenged the team to set the goal of filing our clinical trial application including in the US, under the existing IND, to the authorities before the summer«
– This is of course really challenging, as you know it normally takes approximately 6 months or more to prepare for a study. Also, (and again we want to risk against value), we need to decide in how many countries, and at how many clinical sites we want to perform the study. This will impact both cost and timelines.
Could you summarise your strategy to get SynAct back on track?
- Reduce the number of Board members from 7 to 4 in order to obtain the agility that is needed.
- Secure a lean structure in management and general overheads aligning to present market cap and level of activity and at the same time extend runway.
- Following reporting of the audit of the RESOLVE study secure a constructive interaction with the CRO conducting the study for the benefit of the company.
- Starting out, we will focus on resomelagon in RA. We firmly believe that the compound has the potential to be a novel treatment option in RA.
CSO Thomas Jonassen’s perspective
Thomas, what is your perspective on SynAct Pharma’s journey toward getting back on track?
– We see at least two possibilities moving forward – in newly diagnosed RA patients with high disease (CDAI>22, CRP>3 mg/L), the compound in combination with MTX has the potential to reduce the use of glucocorticoids, ie GC-sparring effect and it has the potential to delay/reduce the use of second line treatment options as the bDMARDs (TNF-blockers).
– In addition, the compound could also be considered as treatment option for second line treatment in patients where initial MTX treatment has failed. Here treatment with the compound in case of continued signs of systemic inflammation (CRP>3mg/L) could be an attractive alternative to the biologics.
– Based on that it would be logic to continue development as first line treatment and explore the possibilities to test the compound as new treatment option in second line. In the near future, we will come back with a detailed development plan aiming to file the next clinical trial application before the summer break.
– We have a large potential in the pipeline outside RA. Both with resomelagon and with the TXP compounds. We will continue to work with these possibilities that includes continued scientific collaboration and additional preclinical pharmacology studies. Setting up additional clinical studies outside RA will evidently need additional funding.
– Importantly we should secure that we get back to a situation where we have continued constructive communication with our investors. We still have a large number of investors who have supported the company for years. This is in many ways a unique situation and gives us opportunities as well as obligations to be as clear as possible in our communication.
Jeppe provides insights on organisation and financing
Jeppe, how will your new CMO, Kristen Harting, contribute to the strategy?
– We are very pleased with adding Kirsten to the team. Kirsten adds many years of experience in clinical development to the company, and together with Thomas Jonassen and Thomas Boesen and the rest of the team, it increases the likelihood for success.
What about business development?
– We will continue the ongoing interactions we have had for the last two years, and the main strategy will be to explore the possibility for striking a deal after positive phase ll data – which we believe is possible. The market is there and the appetite for this indication has not changed.
»The main strategy will be to explore the possibility for striking a deal after positive phase ll data – which we believe is possible. The market is there and the appetite for this indication has not changed.«
With all new members on the Board, one could be concerned about continuation. How will you handle that?
– First of all, we have no plans for making other changes to management. Kirsten Harting recently joined as Chief Medical Officer, and she is a great addition to the team with deep insight and knowledge about clinical development. We think she will complement our CSO Thomas Jonassen very well, and they have already been diving into the details, and have started planning for the next study.
– Both Thomas Boesen, our COO, and Björn Westberg, our CFO, will continue their roles in the management, and importantly Björn will be partnering with Jeppe in controlling the balance between our financial situation and our strategic plans.
– We are also not planning to change other parts of our organisation, and we still have a network of partners that we are collaborating with. Especially, I would like to mention that we are pleased with the Scientific Advisory Board, consisting of world class rheumatologists and professors with expertise in the field of resolution of inflammation, which is the foundation for the success we hope to achieve with our portfolio of compounds.
What about financing – what is your plans for that?
– We are working on a plan for additional financing and have a model in place that we expect to communicate to the market shortly. As Anders mentioned at the EGM we have focused our strategy going forward, so we do not initially need a large amount, which makes it a bit easier to achieve.
Final comments from Thomas on resomelagon’s potential
Thomas, what is your perspective on the potential of resomelagon?
– First and foremost, resomelagon offers an alternative to existing therapies. In many types of diseases where inflammation plays a role, including RA, the current treatments are not sufficient. You see inadequate response, lack of compliance, and side effects. Many treatments are immunosuppressors, whereas resomelagon is modulating the inflammation in a different way. Through resolution of inflammation, the compound is modulating mechanisms in the patient’s own immune system to help overcome the inflammation.
– So far, we have been dosing the compound to both healthy volunteers in RA patients, in patients with nephrotic syndrome and patients suffering with Covid-19 induced respiratory insufficiency. We are very pleased with the safety profile of the compound so far.
– If we can generate clinical proof-of-concept, meaning that a significant effect of the compound is seen in a relevant patient population, we believe that the patients will benefit tremendously from a safe oral drug.
What about the market potential in RA?
– There is a clear need for oral treatment options that reduce the need for the use of glucocorticoids and can reduce the use of compounds that, even though effective, are associated with unwanted side effects as immunosuppression. Here we see a compound like resomelagon, with the potential to induce inflammatory resolution, as a very interesting new treatment option.
– It could potentially change the way you address RA treatment and that would evidently be an attractive market opportunity. Our main purpose is therefore to generate a solid dataset in newly diagnosed patients and in parallel explore the possibilities of using the compound if first line treatment seems not to work – if we succeed, we know that the potential partners will find such a compound very attractive.
The content of BioStock’s news and analyses is independent but the work of BioStock is to a certain degree financed by life science companies. The above article concerns a company from which BioStock has received financing.
