SphingoGene Executive Summary 26SEPT2012 Final
Executive Summary- SphingoGene, Inc.
A. Introduction:
SphingoGene is developing products which will facilitate more effective cancer treatment. Our products will
allow patients to be treated with lower-dose radiation therapy with better efficacy, thus reducing radiationinduced side effects. This is made possible by development of a novel mechanism of therapy which avoids
many of the toxic side-effects of traditional anti-proliferative ("chemo therapy") cancer drugs.
B. Business Description
SphingoGene, Inc. (Delaware C-corp) is a cancer therapeutic development company based in Charleston,
South Carolina. The therapeutic platform focuses on sphingolipid metabolism for treating cancer. The new
company was founded in 2006 by scientists at the Medical University of South Carolina (MUSC). The core
products, technology platform and intellectual property were licensed from MUSC in 2010.
Our focus is to develop unique, effective, and well tolerated sphingolipid anti-cancer therapeutics for use
during standard of care radiation therapy for a variety of cancers. SphingoGene’s mission is to improve the
clinical outcomes, treatment tolerability and quality of life for patients with cancer.
C. Products and Services
SphingoGene has a portfolio of novel, patented, and highly potent small molecule cancer therapeutics
specifically targeting sphingolipid metabolism. The portfolio includes 1) acid ceramidase (AC) inhibitors, 2)
mitochondriotropic/ceramide mimetics, and 3) inhibitors of sphingosine kinase 1 (SK1). Clinical efficacy and
tolerability has been established in animal models of cancer at low uM concentrations for several
compounds.
Simply put, our unique mechanism of drug action allows for more effective cancer treatment without the
toxic side-effects of anti-proliferative cancer drugs. Our novel agents allow for lower-dose radiation therapy
with better efficacy, ultimately reducing radiation-induced side effects. In a dose-escalation animal study
with our clinical lead, toxicity was not observed at effective doses even at the highest concentration
examined (12.5-290 mg/kg) with a durable cure observed.
In a simplified description of the mechanism, during radiation therapy, cera mide is increased and induces
cancer cell death. Acid ceramidase (AC) and sphingosine kinase (SK) are also increased in cancer cells
during radiation therapy. This reduces ceramide levels and allows for cancer cell proliferation and
resistance to radiation. Our compounds either mimic or help maintain high levels of ceramide to enhance
cancer cell death, making radiation therapy and cancer treatment more effective. See Figure 1 for summary
of the mechanism of action of our three lead drugs.
Figure 1
Mechanism of Action; SphingoGene Drug Family
SphingoGene Executive Summary 26SEPT2012 Final
Value Proposition
Radio-sensitization via addition of our drugs leads to:
 Enhanced Radiotherapy leading to more effective cancer treatment
 Fewer side effects
o Achievement of same clinical benefit with reduced radiation
 Improved quality of life
 Greater preservation of sexual function
 Reduce incidence of relapse = Reduced overall treatment costs and reduced death rate
 Small molecules = ease of manufacturing and delivery
D. Intellectual Property
A PCT for the family of SK and AC inhibitors was filed on Nov. 6, 2009: Lysosomotropic inhibitors of acid
ceramidase; US 2011/0251197 A1. (US, Canada, Europe, India, China, Japan, Brazil and Australia) and
covers two different families of AC inhibitor prodrugs, including the lead compound SPG105. The patent has
issued for SPG103 (US8, 093,393 B2) and is pending for SPG104 (US 2012/0035268 A1).
E. Development Timeline
Our in vivo animal proof of concept and non-GLP safety and efficacy studies have been funded via nondilutive federal and state grants totaling $2.34MM. An additional $2.6MM of non -dilutive funding is pending.
Additional rounds of funding via a combination of private and public sources will be obtained to manufacture
clinical-grade drug materials to GMP standards, conduct GLP-toxicology studies, file an Investigational New
Drug Application (IND) in the US and complete up to 2 clinical trials in patients with prostate cancer.
Manufacturing and IND-enabling toxicology will be outsourced to vendors with experience in the sphingolipid
and cancer development space, respectively (e.g., AMRI, SGS, MPI). We will file an IND to conduct our 1 st in
Man/Phase I safety trial in prostate cancer patients undergoing radiation therapy, which will be followed by a
Phase IIa safety/efficacy trial in patients with high risk localized prostate cancer undergoing radiation therapy.
Following successful or during completion and satisfactory outcomes of the Phase IIa prostate cancer trial,
SphingoGene intends to license its lead compounds or be acquired by a pharmaceutical company and
continue to develop and expand its pipeline. See Figure 2 below for a proposed clinical development timeline.
Figure 2
Development Timeline
2013
Specific Aim #1: Manufacturing LCL521 for NCSS studies
1.1 Process development
1.2 Non-GMP synthesis for NCSS
1.3 Analytical support for NCSS
Specific Aim #2: Conditions for in vivo administration and analysis
2.1 Drug formulation
2.2 Bioanalytical method development
Specific Aim #3: toxicity study in rats and non-human primates
3.1 Acute toxicity
3.2 4-week toxicity
Phase 1 clinical trial
Phase II clinical trail
Report Data
AMRI
SGS
2014
MPI
2015
2016
SphingoGene
2017
SphingoGene Executive Summary 26SEPT2012 Final
F. The Market and Financials
The initial target indication is for administration during radiation treatment of prostate cancer, as is standard of
care with other chemotherapeutic agents. For other agents, the typical eight week cost of drugs ranges from
$100 to $30,000. If treatment is provided with inexpensive drugs (e.g., 5-FU or leucovorin), typical costs for the
drugs are $300 for eight weeks. Under conditions where newer drugs are combined with the inexpensive ones
(e.g., Avastin or Erbitux with 5-FU or leucovorin), treatment may cost $30,000 or more over the same time
frame. In the case of SPG 105, it is possible to approximate a dosage cost of $200, which will be given 5 times
a week for approximately 40 days (80Gy total radiation) or $8,000 per patient.
Approximately 903,500 cases of prostate cancer are treated per year worldwide, but our initial market
estimates are US only. There will be approximately 241,740 new cases of prostate cancer in the US in 2012.
Of these, up to 50% of cases will receive radiation therapy. Assuming market penetration consistent with new
cancer therapeutics, revenues from the lead compound in years 1-5 will be in the billions.
Follow-on indications in other cancers are expected. Given that our lead target, AC, is increased in cancer
cells with and without irradiation, SphingoGene’s compounds should be effective in up to 70-100% of all solid
tumors and other cancers. This includes cancers of the lung, breast, oral cavity, cervix, kidney and pancreas.
Thus, the SphingoGene platform is applicable to the any cancer for which patients receive radiation therapy,
including internal radiotherapy (brachytherapy).
Approximate Incidence of other cancer markets (cases/year):
 Lung:
1,600,000
 Breast:
1,380,000
 Pancreatic:
220,000
 Oral cavity:
263,900
Total:
3,463,900 cases/year
G. Company Management
James S. Norris, Ph.D., Board Chairman and Interim CEO of SphingoGene
Dr. Norris is Professor of Microbiology & Immunology at MUSC for 25 years and Chairman for ten years (20002010). He has >154 publications in the fields of cancer biology, gene therapy, drug development and
sphingolipid biochemistry. His research has been continuously funded by the NIH, the NSF and the
Department of Defense for the past 32 years.
David M. Haselwood, MBA, MPH, Business Advisor and member of the Board of Directors
Mr. Haselwood received his MBA from the UC Berkeley’s Haas School of Business and his MPH in Health
Care Finance & Management from UC Berkeley’s School of Public Health. He is a successful serial
entrepreneur, operator and investor in the healthcare industry. He currently serves as Head of Business and
Corporate Development of Gradalis, Inc.: a fully integrated cancer therapeutic development company based in
Dallas, Texas. He served as Principal and Entrepreneur‐in‐Residence at Health Care Investment Visions
(HCIV), a healthcare focused venture development fund. Prior to HCIV, Mr. Haselwood was a member of the
venture capital team at Burrill & Company, a health care merchant bank based in San Francisco with
approximately $1 billion under management.
Yusuf A. Hannun, M.D., Key Scientist
Dr. Hannun, M.D, is currently the Director of the Stony Brook University Cancer Center, the Joel Kenney
Professor of Medicine, and the Vice Dean for Cancer Medicine at the State University of New York, at Stony
Brook. Until recently, he was the Ralph Hirschmann Professor and Chair of the Department of Biochemistry
and Molecular Biology at the MUSC, where he also served as the Deputy Director of the Hollings Cancer
Center. He has published >400 peer reviewed articles on sphingolipid biology.
Allen Conger, MBA - Chief Financial Officer
Mr. Conger earned an MBA in financial management from The University of Chicago: one of the top ranked
programs in the world. His experience as an investment banker expanded his academic understanding of the
various issues involved in financing a company at different stages, which is critical to establishing and growing
a company to market cancer drugs. Mr. Conger has worked with traditional lenders, venture capitalists, private
equity firms, and independent investors.