New CEO and $80M Later, Syndax Looks Prepped for Second IPO Try

If Syndax Pharmaceuticals’ latest financing is any indication, the Waltham, MA-based firm looks to have another shot at an initial public offering in mind.

Syndax has closed a $80 million Series C financing round from a large swath of “crossover” investors that back both public and private companies. Several of the firms in Syndax’s financing have backed other recent biotech crossover rounds, like Editas Medicine, Ovid Therapeutics, and WaVe Life Sciences. These are names like Fidelity Management & Research (which led Syndax’s round), Jennison Associates, EcoR1 Capital, and Cormorant Asset Management—members of the type of syndicate that can support an IPO.

The funding represents a quick turn for Syndax, which pulled plans for an IPO in January, shifted its strategy, and then installed a big-name management team to pull it off.

Syndax had been run by Arlene Morris for about three years, and the company planned to take itself public in 2014 and use the cash partly to fund a late-stage study of entinostat, a drug it was originally developing largely as a breast cancer treatment. The drug is what’s known as a selective inhibitor of histone deacetylases, or HDACs, and Syndax’s plan has been to use it as an add-on to hormone therapy for breast cancer patients.

Syndax hasn’t abandoned that plan—data from a Phase 3 trial are expected in 2017—but it’s since pivoted to try to get in on the crowded field of cancer immunotherapy. As Morris told me last year, a preclinical study published in the Proceedings of the National Academy of Sciences showed that entinostat might boost the effectiveness of two types of “checkpoint inhibitor” cancer drugs—PD-1 and CTLA-4 blockers—which help the immune system recognize tumors.

While PD-1 blockers like Merck’s pembrolizumab (Keytruda) and Bristol-Myers Squibb’s nivolumab (Opdivo) have become important new weapons in the war on cancer, many patients don’t respond to them. That’s led to a slew of combination trials, with several biotechs pairing their drug hopefuls with checkpoint inhibitors.

The potential to get in on this game caused Syndax to cut a deal with Kyowa Hakko Kirin to add cash to its balance sheet, pull the IPO in January, and move its immuno-oncology plans forward. It announced plans on March 31 to run a Phase 1b/2 clinical trial testing entinostat with pembrolizumab in patients with either advanced non-small cell lung cancer or melanoma. Morris had said last year that the company would ponder a return to the IPO queue at some point down the road.

A few months later, in June, Syndax shuffled its management team. Morris—who wasn’t mentioned in the press release—was out and former AstraZeneca chief medical officer Briggs Morrison was brought in to lead the company. Michael Metzger, previously of now-defunct Regado Biosciences, was named Syndax’s president and chief operating officer.

In less than three months, the group has brought an $80 million financing together to carry out the new plan.

“We are delighted that the investment community has confidence in Syndax and has endorsed our strategy to expand the scope of development for entinostat,” Morrison said in a statement.

Aside from Fidelity, Cormorant, EcoR1, and Jennison, some of Syndax’s other new backers include Delos Capital Fund, OrbiMed, Tavistock Life Sciences, Arrowpoint Partners, and BioMed Ventures. Existing backers Domain Associates, MPM Capital, RusnanoMedInvest, and Forward Ventures also contributed.

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