Cynapsus Therapeutics Inc.
TSX VENTURE : CTH

Cynapsus Therapeutics Inc.

January 07, 2011 06:00 ET

Cynapsus President and CEO Provides Update with Open Letter

TORONTO, ONTARIO--(Marketwire - Jan. 7, 2011) - Anthony Giovinazzo, President and CEO of Cynapsus Therapeutics (TSX VENTURE:CTH), has provided shareholders with a strategy update in an open letter that is available on the company web site (www.cynapsus.ca) and below.

Dear friends and shareholders,

A year has passed since my first update to you, following my appointment in November 2009. This appointment was based on effecting a repositioning of the company in several different respects.

I want to take this opportunity to give you an update on our progress at Cynapsus (formerly Cannasat Therapeutics Inc.) over the past year and provide you some insights to our goals for 2011.

2011 will most likely be a critical turning point for Cynapsus, as the accomplishment of our goals should allow past and future shareholders to see Cynapsus in a different light.

My strategy from the beginning has been to build significant value over a three year period, and in the 3rd or 4th year, have this value realized for the benefit of all shareholders. This vision has not changed. I am also pleased to report that during the past year we have accomplished a number of important objectives.

In my update last February, I described three major goals as our priority in 2010:

  1. Secure pharmaceutical partnerships on Cynapsus' THC formulation technology, for both Relivar (the buccal tablet) and a patented generic prototype. This was a lower risk reformulation approach which benefits from patent protection for a significant period of time.
  1. Rebrand the Company as a Central Nervous System (CNS) company, versus a cannabinoid company. Since our cannabinoid drug candidates fit into the CNS profile, by positioning ourselves as a CNS company, we aimed to distance ourselves from some of the stigma associated with cannabinoids.
  1. In-license or acquire a technology and/or a company that is in the CNS sector, which could drive significant potential value. In our first project for in-licensing, we were looking to lower the risk by reformulating an approved drug.

In relation to these goals, I am pleased to report that in 2010 we accomplished the following:

  1. We signed a Definitive License Agreement with IntelGenx Corp. for the Relivar program. IntelGenx will, with one or more development and commercialization pharmaceutical partners, take on the task of completing this project. Cynapsus will not spend any more capital or time, and will benefit from royalties on future sales.

We also significantly advanced our discussions with potential partners for a generic THC project. Our conclusion is that to maximize the potential value from a partner, we may need to invest an additional 6 to 12 months of work. We are still in discussions with potential partners who continue to evaluate this opportunity.

  1. We have successfully rebranded the company to its new focus as a clinical development company for diseases of the brain (Central Nervous System) and renamed it "Cynapsus Therapeutics Inc." This name that has been widely accepted and applauded by investors and participants in the neuroscience field.
  1. We successfully signed an option and license agreement for our new lead program in Parkinson's disease. The project known as "APL-130277" and is a first time oral/buccal thin film-strip reformulation of the drug apomorphine. Currently, apomorphine use in Parkinson's is limited because it is only available as an injection, a dosage form that is considered both inconvenient and painful to use for patients. The convenience of a sublingual thin film strip delivery for patients experiencing ongoing daily movement disorders that are caused by the disease and/or the use of Levodopa based therapies, could translate into a substantial market opportunity. Since apomorphine is an approved drug, the regulatory pathway for approval and eventual marketing of sublingual apomorphine is significantly shortened, and could allow us to gain approval as early as 2014.

In 2010, we have successfully completed a number of additional tasks that have added value in a short period of time:

  1. We established a Clinical Advisory Board for our Parkinson's project, including world leading experts Dr. Fabrizio Stocchi and Dr. C. Warren Olanow.
  1. We hired an internationally experienced Chief Medical Officer, Dr. Albert Agro, with specific experience in the development and approval of CNS drugs, including Parkinson's drugs.
  1. We completed an in-depth survey of US and EU neurologists to gauge their acceptance and need for our apomorphine film-strip product. These survey results validated our product concept and showed that neurologists would value an approved drug using our sublingual delivery system and would use the product to treat several categories of Parkinson's patients.
  1. We completed a US Health Management Organization (HMO) Survey which validated that payers would accept our Parkinson's product on their formulary and would be willing to reimburse patients who need the drug on a chronic basis.
  1. We successfully completed the first significant de-risking step of the Parkinson's project by completing and reporting (in December 2010) the results of animal model studies. The results demonstrated that our sublingual thin film strip system could deliver apomorphine into the bloodstream in a similar manner as injection, in the right quantity and over the right period of time.
  1. We have engaged Summer Street Research Partners (SSRP) to advise us in 2011 on financial matters including capital raising. Based in Boston, SSRP is an institutional focused investment bank primarily targeting the life sciences sector, with a highly reputable research team and research product.

As you can see, we have been focused and are working intensely to accomplish more in less time while making prudent use of our available resources.

Our ambitions for 2011 are equally significant. Specifically, we intend to:

  1. Complete a larger financing to provide 12 to 24 months of capital, ideally from professionally managed investment funds. This will allow us to further develop our Parkinson's project and de-risk it to the point where we can gain maximum value from a potential acquirer or marketing partner.
  1. Complete our submissions and interactions with the US FDA for the Parkinson's project, such that we commence our first Phase 1 human equivalence studies.
  1. Successfully complete the Phase 1 human clinical studies to further de-risk the project and allow it to move to its last stage of development, which should be completed in 2012.
  1. Attract equity research coverage of the company, which should impact liquidity and stock performance accordingly.

I hope you find this summary useful. As always, thank you for your support. 

Please feel free to contact me if you have any questions. 

Sincerely,

Anthony Giovinazzo, President and CEO

About Cynapsus Therapeutics

Cynapsus is a specialty clinical development pharmaceutical company targeting diseases of the brain. Cynapsus' lead drug candidate, APL-130277, is a reformulation of an approved drug (apomorphine), for the treatment of motor fluctuation in Parkinson's disease. APL-130277 is designed to address a much larger moderate to severe patient population, which represents a significant portion of Parkinson's patients.

Cynapsus' strategy is to grow its portfolio of drug candidates through in-licensing and acquisitions, and to advance projects to Phase 2 proof-of-concept clinical studies. Once the drug candidates are sufficiently derisked, Cynapsus intends to out-license the programs to the appropriate pharmaceutical marketing partners for a combination of upfront, milestone, and royalty payments.

More information about Cynapsus (TSX VENTURE:CTH) is available at www.cynapsus.ca.

Forward Looking Statements

This press release contains "forward-looking statements" within the meaning of applicable Canadian securities legislation. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Cynapsus to be materially different from those expressed or implied by such forward-looking statements, including but not limited to those risks and uncertainties relating to Cynapsus' business disclosed under the heading "Risk Factors" in Cynapsus' current Annual Information Form and its other filings with the various Canadian securities regulators which are available online at www.sedar.com. Although Cynapsus has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Cynapsus does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.

The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy or accuracy of this press release.

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