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Firms Making Progress Developing Antibiotics

Emerging from the mounds of data presented at several recent high-level programs on infectious diseases were updates from two publicly traded San Diego drug companies that have collectively raised nearly $400 million to develop narrow-spectrum antibiotics.

While working in different areas in the world of infectious diseases, executives for both pre-revenue biotech companies said they’re keeping the science and the product pipeline moving, relying on support from private capital markets, initial public offerings, grants and federal contracts from the likes of Uncle Sam.

They shared details of their progress at several high-profile drug industry gatherings, such as a conference presented by IDSA, the Infectious Diseases Society of America, which is advocating the need to develop 10 new antibiotics by the year 2020 with its 10 x ’20 initiative.

The lack of new antibiotics in development during the past 20 years — and the need to find drugs that treat life-threatening infections — is a constant battle and a topic of national and worldwide concern for WHO, aka the World Health Organization.

As such, the hometown companies hope to fill a vacuum by developing innovative antibiotics for serious, life-threatening infections.

Executives at San Diego-based Trius Therapeutics and Optimer Pharmaceuticals Inc. said they’re seeing promising results from clinical drug trials and are concentrating science and money in areas with large markets and high unmet needs — travelers’ diarrhea, colon and skin infections and drug-resistant methicillin-resistant Staphylococcus aureus, which is better known as MRSA.

Talking up progress at industry gatherings is a wise move, with the possibilities of attracting future investors, said John Schmid, chief financial officer for Trius, which completed its initial public offering in August and is now listed as TSRX on Nasdaq.

In the biotech sector, it can take many years to determine whether all the effort will translate into returns for a company, said Schmid, a co-founder of the business.

But for those biotech companies that have the cash reserves to remain independent and self-sustaining, licensing deals will continue to drive growth and satisfy early-stage investors wanting to see a nice payoff down the line.

“Investors are eager for us to generate more data,” said Schmid, referring to a post-IPO offering of $50 million that’s funding research and trials into drugs for MRSA and for complicated skin infections and moving things closer to approval by the U.S. Food and Drug Administration.

Others pumping money into Trius are the U.S. Department of Defense, which awarded a contract to develop new antibiotics aimed at safeguarding the country against weapons of mass destruction, including biological threats. The contract is valued at $29.5 million. In 2008, the National Institute of Allergy and Infectious Diseases, which is part of the National Institutes of Health, awarded the company a research grant of $27.7 million.

Trius’ top management just got back from another key industry confab called ICAAC — the Interscience Conference on Antimicrobial Agents and Chemotherapy. “It’s the most important conference of the year for people” in the antibiotics world, said Schmid. “It’s our first ICAAC as a public company,” said Schmid, and it put the firm in front of key clinicians and industry analysts.

Before the IPO, Trius raised $50 million in two venture financing rounds. The company has grown from 10 to 45 employees in three years.

Like Trius, Optimer Pharmaceuticals is looking to claim a sizable share of its market. Optimer, listed as OPTR on Nasdaq, is developing a late-stage drug aimed at the tough-to-treat super bug C. diff., which is commonly treated with vanomycin. Most recently, the company showed its drug, fidaxomicin, works better than vanomycin in treating patients who have been on other antibiotics, according to John Prunty, the company’s CFO.

The business also reported positive data with Pruvel, its antibiotic candidate for treating travelers’ diarrhea.

Optimer, which has 77 employees and was founded in 1998, reported net losses of $42.2 million for 2009 and $35.6 million for 2008.

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