Attached files
| file | filename |
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| 8-K - Inspyr Therapeutics, Inc. | v167883_8k.htm |
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QUARTERLY
UPDATE
|
Third Quarter 2009
Financial Results and Business Update
|
Snapshot
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November
23, 2009
|
|
GenSpera,
Inc. (“GenSpera” or “the Company”) is a development-stage biotechnology
company focused on the discovery and development of prodrug cancer
therapies. A prodrug is an inactive precursor of a drug that is converted
into its active form at a targeted site. The Company has developed a novel
approach to chemotherapy using a prodrug to deliver a potent, cell-killing
agent to tumor sites while avoiding toxicity in healthy, non-cancerous
cells. GenSpera’s prodrugs target cancer cells in one of two ways: (1) by
targeting tumor-associated blood vessels; or (2) by targeting tumors
directly. The Company’s lead prodrug candidate, G-202, is designed to
attack existing tumor vasculature, potentially debilitating the tumor’s
nutrient supply and causing cancer regression without affecting normal
tissues within the body. GenSpera believes that it has validated G-202 as
a drug candidate to treat various forms of solid tumors—including breast,
urinary bladder, kidney, and prostate cancers—based on its ability to
cause tumor regression in animal models of these diseases. GenSpera
expects to initiate Phase I clinical testing of G-202 in the fourth
quarter 2009 at two major cancer centers: (1) the Sidney Kimmel
Comprehensive Cancer Center at Johns Hopkins; and (2) the University of
Wisconsin Carbone Cancer Center. GenSpera’s technology can also be used to
attack cancer cells directly by targeting the prodrug to enzymes believed
to be found solely at a tumor location. The Company’s primary candidate
using this approach, G-115, targets prostate-specific antigen (PSA), a
protein produced by the cells of the prostate gland that is used by
physicians as a “tumor marker” to detect the presence of prostate cancer.
Although GenSpera has identified G-115 and two other compounds as prodrug
candidates, the Company’s present focus is solely on the development of
G-202. GenSpera has headquarters in San Antonio, Texas. On November 2,
2009, GenSpera’s Common Stock commenced trading on the Over-the-Counter
Bulletin Board (OTC.BB) under the symbol “GNSZ.”
|
 GenSpera,
Inc.
2511
N Loop 1604 W
Suite
204
San
Antonio, TX 78258
Phone:
(210) 479-8112
Fax:
(210) 479-8113
www.genspera.com
|
|
Recent
Financial Data
|
|
Ticker
(Exchange)
|
GNSZ
(OTC.BB)
|
*Note: GenSpera’s shares began
trading on the OTC.BB on
November 2,
2009.
|
|
Recent
Price (11/20/2009)
|
$2.50
|
|
|
52-week
Range*
|
$2.00
- $2.62
|
|
|
Shares
Outstanding
|
~15.3
million
|
|
|
Market
Capitalization
|
$38.3
million
|
|
|
Average
3-month Volume*
|
N/A
|
|
|
Insider
Owners + 5%
|
33%
|
|
|
Institutional
Owners
|
9%
|
|
|
EPS
(Qtr. ended 09/30/2009)
|
($0.11)
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Employees
|
2
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Key
Points
|
|
n
|
In
September 2009, after one round of questions and 10 weeks after the
initial Investigational New Drug (IND) submission, the U.S. Food and Drug
Administration (FDA) approved GenSpera’s IND application to begin a Phase
I clinical trial in the fourth quarter 2009 with the Company’s lead
prodrug candidate, G-202. The open-label, dose-escalation study is
expected to enroll up to 30 refractory cancer patients with any type of
solid tumor—a strategy intended to facilitate enrollment and evaluate
safety across a wide range of
patients.
|
|
n
|
In
June and July 2009, GenSpera raised over $3 million in gross proceeds from
the private placement of its securities. A further $240,000 was raised in
September 2009. The Company believes that these funds are sufficient to
carry it through completion of the Phase I studies with G-202 in the
fourth quarter 2010.
|
|
n
|
GenSpera’s
technology is protected by six patents and three pending patent
applications. In contrast to existing anti-angiogenic therapies, which may
only block new blood vessel formation, the Company’s lead compound, G-202,
is designed to attack both existing and newly growing tumor vasculature,
which GenSpera believes could enable it to destroy tumors more quickly
than current therapies.
|
|
n
|
GenSpera’s
management team has extensive experience identifying oncology treatments
and bringing them to the clinic. The Company’s Scientific Advisory Board
is composed of individuals who are both inventors of GenSpera’s technology
and major shareholders.
|
|
n
|
As
of September 30, 2009, GenSpera had cash and cash equivalents of over $2.7
million.
|
PLEASE
REFER TO THE EXECUTIVE INFORMATIONAL OVERVIEW®
(EIO®),
06/02/2009, FOR A FULL COMPANY REPORT.
|
Financial
Results and Recent
Events
|
Third
Quarter 2009 Financial Results
For
the Three Months Ended September 30, 2009
On
November 13, 2009, GenSpera filed its financial results for the three months
ended September 30, 2009. In the third quarter 2009 and corresponding 2008
period, the Company reported no revenues. GenSpera does not anticipate revenues
during the remainder of 2009 as it is a development-stage company.
For the
three months ended September 30, 2009, GenSpera’s general and administrative
(G&A) expenses totaled $659,699 versus $90,337 for the year-ago period. The
Company primarily attributed the 630% increase to higher compensation and
consulting expenses, professional fees, and insurance expenses, which were
$367,000 ($365,000 of which was stock-based compensation), $152,000 (including
$88,000 in stock-based costs), and $18,000, respectively.
Research
and development (R&D) expenses for the three-month period in 2009 were
$878,371 versus $829,374 for the same timeframe in 2008. GenSpera attributed the
6% increase mainly to a $710,000 increase in stock-based compensation expense,
which was offset by a $661,000 reduction in manufacturing and other costs for
the Company’s lead prodrug candidate, G-202. GenSpera’s R&D expenses
included toxicology and other studies, manufacturing, and compensation and
consulting costs.
GenSpera
reported a net loss for the third quarter 2009 of $1,624,120, or a loss of $0.11
per share, versus $955,187, or a loss of $0.08 per share, during the
corresponding 2008 period.
Other
expenses incurred during the three-month period ended September 30, 2009, and
2008 totaled $86,050 and $35,476, respectively. The increase was partially the
result of a change in fair value of derivative liability, which increased to
$86,514 from $0 in the same 2008 period due to an adjustment to the accounting
treatment of the Company’s issued and outstanding Warrants that contain certain
anti-dilution provisions. This increase was slightly offset by a reduction in
finance costs from $39,218 in the 2008 period to $793 for the three months in
2009.
For
the Nine Months Ended September 30, 2009
GenSpera
had no revenues for the nine months ended September 30, 2009, or
2008.
The
Company’s G&A expenses for the nine-month period increased to $1,090,671
from the $603,873 incurred during the equivalent 2008 timeframe. GenSpera
attributed the 81% increase primarily to increases in compensation and
consulting expenses, professional fees, insurance costs, and travel and
entertainment expenses, which rose $167,000, $239,000, $23,000, and $12,000,
respectively. Stock-based costs accounted for roughly $98,000 of the
compensation and consulting expenses and for approximately $88,000 of the
professional fees.
R&D
expenditures for the first nine months of 2009 increased to $1,812,862, up from
the $1,348,369 incurred during the same period of 2008. The 34% increase
reflected compensation expenses that were $798,000 higher than in the 2008
period ($740,000 was due to stock-based compensation), which was partially
offset by a $334,000 reduction in manufacturing and other expenses related to
G-202.
Other
expenses incurred during the nine-month period ended September 30, 2009, and
2008 were $1,252,729 and $38,687, respectively. The increase was partly the
result of higher finance costs, which increased by $439,668 to $478,886, mainly
due to a $415,976 charge for the fair value of additional Warrants issued, which
occurred when anti-dilution provisions included in Warrants GenSpera issued
during a financing in July and August 2008 were triggered. As well, GenSpera
also had a change in fair value of derivative liability, which increased to
$769,625 from $0 in the 2008 period due to an adjustment to the accounting
treatment of the Company’s issued and outstanding Warrants that contain certain
anti-dilution provisions.
For the
first nine months of 2009, GenSpera reported a net loss of $4,156,262, or a loss
of $0.31 per share, versus $1,990,929, or a loss of $0.19 per share, during the
corresponding nine-month period in 2008.
|
CRYSTAL
RESEARCH ASSOCIATES, LLC
|
QUARTERLY
UPDATE
|
PAGE
2
Subsequently,
as of September 30, 2009, GenSpera had cash and cash equivalents of
approximately $2,742,000 versus $2,100,212 at the close of the second quarter on
June 30, 2009. Based on a monthly cash burn rate of $195,000, the Company
anticipates that this amount is sufficient to support operations for at least
the subsequent 13 months under the assumption that no extraordinary transactions
or unexpected events or contingencies occur during the period. During the nine
months ended September 30, 2009, GenSpera raised roughly $3,830,000 through the
sale of the Company’s Common Stock units. This encompassed $750,000 raised by
GenSpera during February and April 2009, roughly $3 million raised during June
and July 2009, and $240,000 raised in September 2009.
Recent
Events
An
overview of GenSpera’s significant recent events is provided below, referring
the reader to GenSpera’s filings with the U.S. Securities and Exchange
Commission (SEC) for greater information.
|
■
|
On November 2, 2009,
GenSpera’s Common Stock commenced trading on the Over-the-Counter Bulletin
Board (OTC.BB) under the symbol
“GNSZ.”
|
|
■
|
On September 11, 2009,
the Company announced that the U.S. Food and Drug Administration (FDA)
approved its Investigational New Drug (IND) application for G-202. The
Company expected to initiate a Phase I clinical study in the fourth
quarter 2009. Greater details about the upcoming trial are provided on
page 7.
|
|
■
|
In September 2009,
GenSpera raised roughly $240,000 in gross
proceeds.
|
|
■
|
On August 14, 2009,
GenSpera received a Notice of Effectiveness from the SEC accepting
the Company’s Form S-1 (filed in July 2009), the general form for
registration of securities under the Securities Act of 1933, and thereby
registering GenSpera’s shares for public
trading.
|
|
■
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On August 12, 2009, the
Company filed an amendment to the previously submitted Form
S-1.
|
|
■
|
On July 31, 2009,
GenSpera filed Form S-1 with the SEC relating to the resale of 4,516,120
shares of the Company’s Common Stock. GenSpera’s Common Stock was not then
traded on any market or exchange, and the Company had not yet applied for
listing or quotation on any public market. GenSpera anticipated seeking
sponsorship to trade its Common Stock on the Over-the-Counter Bulletin
Board (OTC.BB) once the registration became
effective.
|
|
■
|
On July 29, 2009, the
Company entered into a Securities Purchase Agreement with a number of
accredited investors. Per the terms of the agreement, GenSpera sold units
aggregating approximately $907,000 to the investors. The price per unit
was $1.50. Each unit consisted of the following: (1) one share of the
Company’s Common Stock; and (2) one half Common Stock Purchase Warrant.
The Warrants had a five-year term and allowed investors to purchase
GenSpera’s Common Shares at $3.00 per share. The Warrants contained
anti-dilution protection against stock splits, stock dividends, and
similar transactions. GenSpera incurred $79,583 in fees and expenses for
the transaction. The Company also issued 40,001 additional Common Stock
Purchase Warrants under the same terms as the investor Warrants to
compensate certain finders.
|
|
■
|
On July 24, 2009,
GenSpera received notification from the FDA that its IND for G-202 was on
clinical hold pending the Company’s response to certain questions provided
by the FDA. The questions concerned the design of GenSpera’s proposed
Phase I clinical trial.
|
|
■
|
On July 10, 2009, the
Company issued a Common Stock Purchase Warrant to purchase 150,000 Common
Shares as reimbursement for due diligence expenses. The Warrants had a
five-year term and entitled the holder to purchase GenSpera’s Common Stock
at $3.00 per share.
|
|
CRYSTAL
RESEARCH ASSOCIATES, LLC
|
QUARTERLY
UPDATE
|
PAGE
3
|
■
|
In June and July 2009, GenSpera raised an aggregate of $3,088,000 from the private placement of its securities. |
|
■
|
On June 29, 2009, the
Company entered into a Securities Purchase Agreement with a number of
accredited investors. Per the terms of the agreement, GenSpera sold the
investors units aggregating roughly $2,131,000 at a price of $1.50 per
unit. Each unit consisted of the following: (1) one share of the Company’s
Common Stock; and (2) one half Common Stock Purchase Warrant. The Warrants
had a five-year term and allowed investors to purchase GenSpera’s Common
Shares at $3.00 per share. The Warrants also contained anti-dilution
protection in the event of stock splits, stock dividends, or other similar
transactions. GenSpera incurred $142,467 in fees and expenses for the
transaction, $50,000 of which had been paid through the issuance of 33,334
units. The Company also issued 43,894 additional Common Stock Purchase
Warrants under the same terms as the investor Warrants to compensate
certain finders.
|
|
■
|
On June 23, 2009,
GenSpera submitted an IND application to the FDA for
G-202.
|
|
CRYSTAL
RESEARCH ASSOCIATES, LLC
|
QUARTERLY
UPDATE
|
PAGE
4
|
Company
Background
|
GenSpera,
Inc. (“GenSpera” or “the Company”) is focused on discovering and developing
prodrug cancer therapeutics to treat a wide range of solid tumors, including
breast, prostate, lung, colon, bladder, and kidney cancers. The Company’s
business strategy entails developing a series of therapies based on its
target-activated prodrug technology platform, identifying potentially attractive
drug candidates with solid intellectual property (IP) protection, and then
developing these compounds through Phase I/II clinical trials. Once a candidate
reaches this stage, the Company intends to license the rights for further
development to more established pharmaceutical companies, which could then
finalize drug development and market the resulting therapeutic.
Cancer
The human
body is composed of trillions of cells that constantly grow, divide, and die.
For the most part, the cells in the body are healthy and perform their vital
functions. However, when healthy cells do not perform properly, they typically
self-destruct and are replaced. Cancer cells reproduce uncontrollably,
regardless of their abnormalities. While the exact mechanism of transformation
that causes normal cells to become cancerous remains unknown, cancer cells are
believed to develop due to mutations caused by changed or damaged DNA. Instead
of dying when they should, the abnormal cells constantly grow and divide,
producing new cells that are not needed by the body. Once cancerous cells are
established, they may rapidly invade surrounding tissues. As cancer cells grow,
they require sufficient nutrition, which is initially acquired by feeding off of
the body’s systems in a parasitic manner. In order for a tumor to continue
growing beyond the size of roughly a pinhead, its cancer cells recruit blood
vessels through a process called tumor angiogenesis. This development enables
cancer cells to achieve self-sustainable growth by acquiring their own blood
supply, which further fuels the spread of tumors.
Traditional
chemotherapy involves treating patients with cytotoxins, which are compounds or
agents that are toxic to cells. In the early stages of cancer, chemotherapy may
be combined with surgery or radiation to improve the efficacy of a treatment
regimen. In the later stages of the disease, after the cancer has spread to
another region of the body, chemotherapy is often the only treatment option for
many forms of cancer. However, traditional chemotherapies have several prominent
disadvantages: (1) they affect both healthy and cancer cells indiscriminately,
causing negative side effects; (2) they exert their toxic effect when cells
divide, which can be ineffective in tumors with cells that divide at a slower
rate than cells in normal tissues; and (3) cancer cells may develop a drug
resistance after repeated exposure to current chemotherapies, thus limiting the
number of times a therapy can be used effectively.
Cancer is
the second most common cause of death in the U.S. In 2009, the American Cancer
Society (ACS) estimated that roughly 1,500 individuals die of cancer daily,
totaling more than 560,000 cancer-related deaths annually (Source: the ACS’s
Cancer Facts & Figures
2009). The disease also impacts countries on an economic level. In 2007,
the U.S. National Institutes of Health (NIH) approximated the overall cost of
cancer to be $219 billion, encompassing $89 billion for direct medical costs and
$130 billion for lost productivity due to illness or premature
death.
GenSpera’s
Prodrug Chemotherapy
Prodrug
chemotherapy is currently being investigated as a technique to deliver higher
concentrations of cytotoxic agents to the tumor location while avoiding the
toxicity to healthy tissues. Prodrug technology encompasses the administration
of an inactive form of a cytotoxin, called a prodrug, to a patient. The prodrug
is designed to be activated only through a conversion that occurs exclusively at
a tumor site. If successfully developed, GenSpera believes that prodrug
therapies could provide an effective therapeutic approach for a broad range of
solid tumors caused by breast, prostate, lung, colon, and other cancers. The
Company’s prodrug technology involves attaching a targeting/masking agent to an
active drug, temporarily making the drug both soluble for intravenous
administration and inactive in the bloodstream. Once the compound reaches its
target, the masking agent is removed by an enzyme found at the tumor location.
With the agent detached, the drug is reactivated and becomes insoluble,
precipitating directly into nearby cancer cells. The cancer is killed due to the
toxic effects of the activated drug.
GenSpera
uses a two-tiered strategy to target its medicine specifically to tumor sites.
First, the Company identifies select enzymes (proteases) that are found at
higher levels in tumors relative to other tissues in the body. Upon identifying
these enzymes, GenSpera creates peptides that are recognized predominantly by
those enzymes in the tumor and not by enzymes in normal tissues. Because enzyme
recognition is required to remove the selected peptide (the targeting/masking
agent) and activate the cytotoxin, this aspect seeks to ensure that the compound
does not cause toxicity in areas of the body other than the targeted
site.
|
CRYSTAL
RESEARCH ASSOCIATES, LLC
|
QUARTERLY
UPDATE
|
PAGE
5
The
Company has developed various peptides to target different cancerous tumors.
GenSpera uses 12-ADT—a chemically modified form of the cytotoxin thapsigargin
that kills fast-, slow-, and non-dividing cells—as the therapeutic component of
the Company’s prodrugs, including in its lead candidate, G-202. Thapsigargin is
a potent and novel cytotoxin extracted from the plant, T. garganica, which is 10- to
100-fold more potent than the National Cancer Institute’s reference
chemotherapeutic agents. 12-ADT functions by dramatically raising the level of
calcium inside cells, which leads to cell death. The Company believes that
12-ADT addresses several issues prevalent with current chemotherapies as it does
not appear to trigger the development of resistance to its effects, and it is
able to target cells regardless of their rate of division. GenSpera believes
that targeting cell death independently of cell division is important for three
reasons: (1) it allows the drug to be effective against tumor cells that divide
more slowly than normal cells in the body (e.g., prostate cancer); (2) the drug
can be effective against the very slowly dividing blood vessel cells within
solid tumors; and (3) the drug may also kill cancer stem cells, which in general
are also very slowly dividing.
To date,
GenSpera has identified four prodrug candidates, as listed in Table 1.
Presently, the Company is engaged solely in the development of G-202. GenSpera
uses two approaches in its prodrugs: (1) targeting the blood supply that
supports tumor growth; and (2) targeting the tumor directly. Each of these
approaches is briefly summarized following Table 1 and more fully detailed on
pages 23-31 of Crystal Research Associates’ base report, the Executive
Informational Overview®
(EIO®), dated
June 2, 2009, and available at www.crystalra.com.
Table 1
GenSpera, Inc.
PRODRUG
CANDIDATES
|
Prodrug Candidate |
Activating Enzyme |
Target
Location of Activation
Enzyme |
Status
|
|
G-202
|
Prostate-Specific
|
The blood vessels
of
|
■ Validated efficacy in preclinical
animal models
|
|
Membrane
Antigen
|
all solid
tumors
|
(Johns Hopkins
University)
|
|
|
(PSMA)
|
■ Completed formal toxicology studies
(Ricerca
|
||
|
Biosciences,
LLC)
|
|||
|
■ Manufactured drug substance for
clinical trials
|
|||
|
(InB:Hauser
Pharmaceuticals)
|
|||
|
■ Received
approval from the U.S. Food and Drug
|
|||
|
Administration
(FDA) to commence Phase I clinical
|
|||
|
testing in the
fourth quarter 2009
|
|||
|
G-114
|
Prostate-Specific
|
Prostate
cancers
|
■ Validated
efficacy in preclinical animal models
|
|
Antigen
(PSA)
|
(Johns Hopkins
University)
|
||
|
G-115
|
Prostate-Specific
|
Prostate
cancers
|
■ Validated
efficacy in preclinical animal models
|
|
Antigen
(PSA)
|
(Johns Hopkins
University)
|
||
|
Ac-GKAFRR-
|
Human
Glandular
|
Prostate
cancers
|
■ Validated
efficacy in preclinical animal models
|
|
L12ADT
|
Kallikrein 2
(hK2)
|
(Johns Hopkins
University)
|
Source: GenSpera,
Inc.
|
CRYSTAL
RESEARCH ASSOCIATES, LLC
|
QUARTERLY
UPDATE
|
PAGE
6
Targeting
the Blood Supply that Supports Tumor Growth
Of the
four identified candidates, GenSpera is currently focused on developing G-202,
which targets the blood vessels of solid tumors. G-202 combines the cytotoxic
activity of 12-ADT with a specific peptide that masks its activity until it is
delivered to the target site. The peptide can only be removed by
prostate-specific membrane antigen (PSMA)—a process referred to as the targeted
delivery of the active drug. PSMA is expressed in non-cancerous and cancerous
prostate tissues, at lower levels in some non-prostate tissues (e.g., kidney),
and in the endothelial cells of vasculature associated with non-prostate cancers
(Source: Journal of
Carcinogenesis 2006, 15[5]:21). In particular, PSMA is over-expressed in
prostate cancer as well as in the newly formed vasculature of several types of
solid tumors (Source: The
Prostate 2008, 69[5]:471-479). Because PSMA is expressed in
tumor-associated blood vessels, G-202 and any other PSMA-targeted prodrugs that
GenSpera may develop could be able to attack the blood supplies of many
different tumor types.
GenSpera
has conducted several studies using G-202 in various animal models of solid
tumors, including in prostate, bladder, renal (kidney), and breast cancers.
G-202’s demonstrated anti-tumor effects in these cancer types further the belief
that G-202 may have broad application as a therapy for a variety of human solid
tumors due to its ability to selectively target PSMA-producing endothelial cells
within tumors. In these studies, the administration of G-202 caused noticeable
regression of the tumor—in some cases with no visible re-growth for
approximately one month following the last treatment. G-202 was well tolerated
at dose levels that caused regression of tumor growth, with no signs of
toxicity. At the highest doses, transient weight loss was documented, which
quickly recovered after each course of the therapy. The data also indicated that
even after repeated dosing cycles, G-202 did not activate drug resistance in
tumor cells.
GenSpera
is optimistic that it may be able to eliminate cancerous tumors with dosing that
is effective for a significant length of time. Further, the Company believes
that this is more likely to be achieved in humans than in mice due to the
ability to infuse the drug into human patients and an anticipated longer
half-life of G-202 in the human bloodstream versus that of laboratory animals.
Given its efficacy profile, G-202 could also be effective as a monotherapy, thus
reducing the costs and time required to conduct clinical trials.
Current
Status of G-202
An
Investigational New Drug (IND) application for G-202 was approved by the U.S.
Food and Drug Administration (FDA) in September 2009. GenSpera expects to
initiate a Phase I clinical trial with G-202 for the treatment of cancer in the
fourth quarter 2009. The IND, which was originally submitted in June 2009,
contained the Company’s proposed Phase I clinical plan and preclinical data
pertaining to G-202, including the scientific rationale, efficacy data in
animals, toxicology data, manufacturing information, drug formulation, and
stability records, among other information. Previously, GenSpera completed
definitive toxicology studies of G-202 in rats and monkeys in the second quarter
2009.
The
open-label, dose-escalation Phase I study could include up to 30 refractory
cancer patients—individuals who have relapsed following treatment with other
chemotherapies—with any type of solid tumors. GenSpera expects this approach to
enhance patient accrual rates and provide the Company with safety data across a
range of cancer types. The primary endpoints of the study include determining
the safety, tolerability, and pharmacokinetics of G-202. As well, the design of
the trial permits the collection of efficacy data. The Company expects to
perform the trial at two major cancer centers: (1) the Sidney Kimmel
Comprehensive Cancer Center at Johns Hopkins in Baltimore, Maryland; and (2) the
University of Wisconsin Carbone Cancer Center in Madison, Wisconsin. The final
terms of the contracts at these locations have not yet been determined. As well,
the clinical protocol is currently undergoing Institutional Review Board
evaluation at both sites. The Company has already manufactured sufficient
quantities of G-202 to support the Phase I clinical trial. Following the
completion of the Phase I trial, GenSpera may advance into multiple Phase II
clinical trials for G-202 in several different cancer types. Although it is too
early in the preclinical development process for the Company to determine which
type of tumor to evaluate, GenSpera anticipates that up to 40 patients could be
enrolled in a trial that may last 18 months.
The
Company believes that the acceptance of its IND by the FDA constitutes a
defining milestone in the development of a new class of anticancer agents, which
are expected to have broad utility across many tumor types. Moreover, GenSpera
may seek to establish a strategic partnership to maximize the value of G-202 as
the compound progresses through future clinical trials.
|
CRYSTAL
RESEARCH ASSOCIATES, LLC
|
QUARTERLY
UPDATE
|
PAGE
7
Targeting
the Tumor Directly
Compared
to other cancers, prostate cancer has a large proportion of slowly proliferating
cells that are resistant to treatment with conventional cytotoxic agents.
Current therapies generally attack and destroy rapidly dividing cells, and thus
spare cancer cells that divide slowly—a feature that is characteristic of
prostate cancers. GenSpera’s technology has a broad range of potential
applications, including techniques that pair cytotoxic derivatives of
thapsigargin to peptides in order to target prostate tumors directly. As such,
GenSpera sought to develop a prodrug candidate using this approach that avoided
the negative aspects of current prostate cancer therapies. Although GenSpera has
identified the candidates detailed below, including G-114, G-115, and
Ac-GKAFRR-L12ADT, the Company’s current focus is solely on the development of
G-202. The Company plans to advance these candidates subsequent to the
development of G-202, when sufficient resources are available.
GenSpera’s
first approach to this strategy couples thapsigargin to peptides that were
selectively cleaved by a prostate cancer-specific protease called
prostate-specific antigen (PSA), which led to GenSpera’s candidate, G-115. PSA
is active within tumor sites and in normal prostate tissue but is inactive
within the bloodstream, characteristics that form the basis for tumor-specific
delivery of cytotoxic agents. To develop a PSA-activated prodrug, GenSpera
focused on the identification of a derivative of thapsigargin that could be
chemically coupled to a PSA-substrate peptide, yet retain all of the activity of
the parent agent after it was released from the prodrug by PSA. GenSpera
initially identified G-114 as a potential candidate. However, continued
screening and optimization of PSA-cleavable peptides led to the discovery of
G-115, which the Company selected as its lead development candidate in the
PSA-targeted prodrug program due to its enhanced PSA-substrate and in vivo anti-tumor activity
and its broader patent coverage.
The
Company’s second program entails the delivery of thapsigargin selectively to
prostate tumors via human glandular kallikrein 2 (hK2), another prostate
cancer-specific protease. Prostate cancer cells secrete the protease hK2, which
may be used to activate thapsigargin-derived prodrugs. Through the laboratories
of GenSpera’s Scientific Advisory Board members, Dr. John T. Isaacs, Dr. Samuel
R. Denmeade, and Dr. Hans Lilja (biographies on pages 11-12 of the base EIO®), the
Company has identified peptides that are selectively cleaved by hK2. The Company
has coupled them to 12-ADT to generate a family of hK2-activated thapsigargin
prodrugs, including Ac-GKAFRR-L12ADT, which GenSpera considers to be the most
fully characterized prodrug of this species. The hK2 program has resulted in
several molecules with anticancer properties in animal models, and the Company
is currently focused on the development of second-generation hK2-activated
thapsigargin prodrugs with improved formulations and increased half-lives in
animals.
Corporate
Information
Incorporated
in Delaware in 2003, GenSpera was founded as part of a business development
initiative based on technology and IP owned by Johns Hopkins. In early 2004, the
IP underlying the Company’s technologies was assigned from Johns Hopkins to its
co-inventors, Dr. Isaacs, Dr. Denmeade, Dr. Soren Brogger Christensen, and Dr.
Lilja, who in turn awarded an option to license the IP to the Company in return
for continued protection of the patent portfolio. This option was exercised in
early 2008 through the reimbursement of past patent prosecution costs that were
incurred previously by Johns Hopkins. The co-inventors, who now comprise the
Company’s Scientific Advisory Board, assigned the IP to the Company in April
2008. GenSpera’s activities between 2004 and 2008 were limited to continued
prosecution of the relevant patent portfolio. The Company currently has no oral
or written agreements with Johns Hopkins with regard to any other IP or research
activities. In addition, GenSpera does not owe any milestone or royalty payments
to third parties. Detailed biographies of GenSpera’s executive officers as well
as each member of the Scientific Advisory Board are provided on pages 10-12 of
the EIO®.
In
December 2008, the Company received a Notice of Effectiveness from the U.S.
Securities and Exchange Commission (SEC), accepting its Form S-1 that registered
all shares sold during 2007 and 2008. On July 31, 2009, the Company submitted a
second Form S-1 to register those new shares sold subsequent to the first
submission through that point in time. In August 2009, the Company received a
Notice of Effectiveness from the SEC, accepting its Form S-1 only two weeks
after submission and registering the Company’s shares for public trading.
GenSpera has submitted a 15c2-11 application (Form 211) to the Financial
Industry Regulatory Authority (FINRA), indicating that the Company
has
satisfied
applicable requirements of the SEC Rule 15c2-11 and the filing and information
requirements of NASD Rule 6640. GenSpera’s Common Stock commenced trading on the
Over-the-Counter Bulletin Board (OTC.BB) in November 2009 under the ticker
symbol “GNSZ.”
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Headquarters
and Employees
GenSpera’s
headquarters are located in San Antonio, Texas, where the Company leases a
roughly 850-square foot facility. As of November 2009, GenSpera employed two
individuals who serve as the Company’s executive officers.
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Key
Points to
Consider
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GenSpera’s
prodrug technology entails the attachment of a targeting/masking agent to
an active drug, making the drug inactive and soluble in the bloodstream.
The Company uses specific peptides as its targeting/masking agents, and an
analog of the cytotoxin thapsigargin, called 12-ADT, as the active drug.
The Company’s prodrugs are designed to either target the blood supply that
is supporting tumor growth or target the tumor
directly.
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The
prodrug can only be reactivated once the targeting/masking agent is
removed by an enzyme that is expressed at the site of a tumor. With the
agent detached, the drug becomes insoluble and precipitates directly into
nearby cells. As well, the Company’s patent-protected peptides, which are
based on years of research by GenSpera’s Scientific Advisory Board
members, were developed to attack multiple
targets.
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Traditional
cancer treatments (e.g., surgery or radiation therapy) are localized
therapies that lose efficacy once the cancer has spread. Chemotherapeutics
are also widely used, but as many are not targeted, their toxic effects
harm both healthy tissues and cancer cells. In contrast, GenSpera’s
prodrug technology may be more effective for cancer that has spread due to
its ability to deliver higher concentrations of cytotoxic agents to tumors
while avoiding the toxicity of these higher doses in the rest of the
body.
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The
Company’s lead prodrug candidate, G-202, is composed of 12-ADT and a
targeting/masking agent. Once G-202 is administered intravenously into the
bloodstream, it can only be activated at a target site by
prostate-specific membrane antigen (PSMA), which is expressed in
cancer-supporting vasculature but not in normal blood vessels. G-202 may
be able to inhibit further tumor angiogenesis and attack existing tumor
vasculature—stopping growth by depleting the cancer’s nutrient supply and
potentially causing tumor regression—versus the current generation of
anti-angiogenesis drugs that GenSpera believes only slow or prevent
further growth of tumors, but do not cause tumor
regression.
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Based
on G-202’s preclinical data and its specific, robust mechanism of action,
the Company believes that G-202 can demonstrate increased efficacy and
less toxicity versus currently available chemotherapies, which cause
toxicity to all rapidly dividing cells in the body, including healthy,
non-cancerous cells.
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In
September 2009, the Company received approval from the U.S. Food and Drug
Administration (FDA) for its Investigational New Drug (IND) application
for G-202 after only one round of questions and less than 10 weeks after
the initial IND submission. GenSpera plans to initiate a Phase I clinical
trial with G-202 in refractory cancer patients during the fourth quarter
2009. The study’s primary endpoints include determining the safety,
tolerability, and pharmacokinetics of G-202. Efficacy data may be
collected in parallel.
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GenSpera’s
second prodrug technology approach attacks cancer cells directly by
targeting enzymes found primarily in tumors. G-115, the primary
development candidate in this area, targets a protein used by physicians
to detect the presence of prostate cancer, called prostate-specific
antigen (PSA).
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GenSpera
is supported by a management team with extensive experience in identifying
oncology treatments and bringing them to the clinic as well as its
Scientific Advisory Board, which is composed of members who are all
inventors of the technology as well as
shareholders.
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In
August 2009, the Company received a Notice of Effectiveness from the U.S.
Securities and Exchange Commission (SEC), accepting its second Form S-1
only two weeks after submission and registering the Company’s shares for
public trading. GenSpera has submitted a 15c2-11 application for its
listing on the Over-the-Counter Bulletin Board (OTC.BB) to the Financial
Industry Regulatory Authority (FINRA). The Company’s Common Stock
commenced trading on the OTC.BB in November 2009 under the ticker symbol
“GNSZ.”
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At
September 30, 2009, GenSpera had cash and cash equivalents of over $2.7
million after raising over $3 million in gross proceeds from a private
placement in mid-2009 and a further $240,000 in gross proceeds in
September 2009. The Company believes that these funds are sufficient to
carry it through the completion of Phase I studies for
G-202.
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Risks
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Some of
the information in this Quarterly Update relates to future events or future
business and financial performance. Such statements can only be predictions and
the actual events or results may differ from those described due to the risks
presented in GenSpera’s statements on Forms 10-K, 10-Q, as well as other forms
filed from time to time. The content of this report with respect to GenSpera has
been compiled primarily from information available to the public released by the
Company through U.S. Securities and Exchange Commission (SEC) filings. GenSpera
is solely responsible for the accuracy of this information. Information as to
other companies has been prepared from publicly available information and has
not been independently verified by the Company. Certain summaries of activities
have been condensed to aid the reader in gaining a general understanding. For
more information about GenSpera, please refer to the Company’s website at www.genspera.com.
Additionally, please refer to Crystal Research Associates’ base report, the
Executive Informational Overview®
(EIO®) dated
June 2, 2009, and located on Crystal Research Associates’ website at www.crystalra.com
for more comprehensive details of GenSpera’s risk factors.
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CRYSTAL
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Jeffrey J. Kraws or Karen B.
Goldfarb
Phone: (609) 306-2274
Fax: (609) 395-9339
Email: eio@crystalra.com
Web: www.crystalra.com
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Legal Notes and Disclosures: This report has been prepared by GenSpera, Inc. (“GenSpera” or “the Company”) with the assistance of Crystal Research Associates, LLC (“CRA”) based upon information provided by the Company. CRA has not independently verified such information. In addition, CRA has been compensated by the Company in cash of thirty-eight thousand five hundred U.S. dollars and fifty thousand Options/Warrants for its services in creating the base EIO®, for updates, and for printing costs.
Some of
the information in this update relates to future events or future business and
financial performance. Such statements constitute forward-looking information
within the meaning of the Private Securities Litigation Act of 1995. Such
statements can be only predictions and the actual events or results may differ
from those discussed due to, among other things, the risks described in
GenSpera’s reports on its 10-K, 10-Q, and other forms filed from time to time.
The content of this report with respect to GenSpera has been compiled primarily
from information available to the public released by GenSpera. The Company is
solely responsible for the accuracy of that information. Information as to other
companies has been prepared from publicly available information and has not been
independently verified by GenSpera or CRA. Certain summaries of scientific
activities and outcomes have been condensed to aid the reader in gaining a
general understanding. For more complete information about GenSpera, the reader
is directed to the Company’s website at www.genspera.com.
This report is published solely for information purposes and is not to be
construed as an offer to sell or the solicitation of an offer to buy any
security in any state. Past performance does not guarantee future performance.
Free additional information about GenSpera and its public filings, as well as
free copies of this report, can be obtained in either a paper or electronic
format by calling (210) 479-8112.