Ziopharm Goes Lean to Stretch Funds for New Synthetic Biology Focus

4/9/13Follow @Tansey_Xconomy

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an immune response against the tumor’s signature molecules, killing the cancerous cells. The worry with introducing gene-based therapies into the body has always been this: once a gene is inserted into the body, doctors can’t take it out.

But synthetic biology holds out the prospect of allowing doctors to keep communicating with the gene. If clinical trial participants injected with Ad-RTS IL-12 start developing severe symptoms associated with interleukin-12, investigators stop giving them the oral activator pill, and the switch turns off, Lewis says.

“It’s a safety valve,” he says.

That biological gizmo, called the RheoSwitch Therapeutic System, was licensed from the synthetic biology company Intrexon, whose human therapeutics division is based in Germantown, MD. Intrexon has developed an inventory of molecular  parts—genes, switches, and other biological mechanisms—that can be mixed and matched to construct various molecular machines to accomplish narrowly focused tasks inside an organism.

Intrexon is a hub of the nascent movement of synthetic biology into drug development. It has licensed its technology to multiple startups, often taking shares in the companies as part of its compensation. One licensee, Ann Arbor, MI-based Adeona, is using Intrexon’s  RheoSwitch to control the intracellular production of an enzyme that may help people with pulmonary arterial hypertension. Among Intrexon’s other partners are Synthetic Biologics (NYSE: SYN) of Rockville, MD, and San Francisco; Halozyme Therapeutics (NASDAQ: HALO), of San Diego and Foster City, CA; and Fibrocell Science (FCSC) of Exton, PA.

Ziopharm said in October that results of a Phase 1 clinical trial of its experimental therapy, Ad-RTS IL-12, in advanced melanoma had encouraged the company to begin a  Phase 2 trial. Lewis says more detailed data will be released in May or June.

In March, the company said it had also launched a Phase 2 study of Ad-RTS IL-12 in advanced breast cancer. Lewis says interim results of this trial could come by the end of the year, with final data in the first half of 2014.

Ziopharm’s business has become increasingly intertwined with Intrexon and its CEO, Randal J. Kirk, a serial entrepreneur who has founded or served on the boards of companies later acquired at notable prices, including New River Pharmaceuticals, bought by Shire in 2007; Fremont, CA-based Scios, which was acquired by Johnson & Johnson (NYSE: JNJ) in 2003; and Newton, MA-based Clinical Data, which was acquired by Forest Laboratories (NYSE: FRX).

Kirk serves on Ziopharm’s board, and Intrexon received about 3.6 million shares of Ziopharm late last year as part of their technology licensing agreement. Entities managed by Kirk, who is CEO of the investment firm Third Security, have also been accumulating Ziopharm shares in the market. Their stake is 14.9 million shares, or about 18 percent of Ziopharm’s outstanding shares, making the entities associated with Kirk Ziopharm’s largest single owner.

As of May 2011, Intrexon had raised more than $259 million to support its synthetic biology platforms and commercial partnerships. Which raises the question: if Ziopharm runs out of cash to demonstrate the potential of Intrexon’s technology, would the larger company step in to shore up its investment?

Bernadette Tansey is Xconomy's San Francisco Editor. You can reach her at btansey@xconomy.com. Follow @Tansey_Xconomy

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