The Chapel Hill, NC, company last year licensed Japanese development and commercialization rights for its solithromycin to Toyama Chemical Co. in a deal that could pay up to $60 million in milestones. Cempra now says Toyama completed Phase 1 trials of the antibiotic and received the regulatory go ahead to start Phase 2 trials, a milestone that triggers a $10 million payment to Cempra.
Toyama is currently testing solithromycin as a treatment for respiratory tract infections, and also holds Japanese rights to develop and commercialize the drug to treat other conditions. If Toyama is able to bring the drug to the Japanese market, the second largest antibiotic market in the world, Cempra stands to collect royalties from sales of the drug in a country that spends an estimated $4 billion per year on antibiotics.
Toyama’s clinical milestone has no direct bearing on Cempra’s own clinical trials of solithromycin. But Cempra CEO Prabhavathi Fernandes says that Toyama’s work contributes to solithromycin’s safety profile. This additional data could allow Cempra, if regulators allow, to conduct smaller trials as the company studies its antibiotic in a wide range of uses.
“If it’s safe and effective, it has a good chance of being a blockbuster,” Fernandes says.
Solithromycin is a macrolide, a class of antibiotics that has been widely used for decades to treat bacterial infections, such as pneumonia and Legionnaires’ disease. The last new macrolide to reach the market was azithromycin, which the FDA approved in 1988. Azithromycin totaled 51 million prescriptions in 2013, according to IMS Health.
Cempra’s lead target for solithromycin is community acquired bacterial pneumonia (CABP), a disease most commonly treated with the now generic azithromycin or another antibiotic, levofloxacin (Levaquin). But use of macrolides as a first-line treatment for respiratory tract infections has led to high rates of pneumococcus resistance to the drugs, according to the Center for Disease Dynamics, Economics & Policy.
Levofloxacin reached blockbuster status for its manufacturer, Johnson & Johnson (NYSE: [[ticker:JNJ]), peaking at $1.6 billion in 2007 sales before patent expirations started to chip away at the drug’s revenue. Fernandes says solithromycin’s safety profile could be an advantage against the older drug, which is associated with an increased risk of tendinitis and tendon rupture. So far, the Cempra drug has shown none of the health risks associated with levofloxacin.
Fernandes, whose experience includes work at Bristol-Myers Squibb (NYSE: BMI) and the Pharmaceutical Research Institute, founded Cempra in 2006. That year, Cempra acquired a library of 500 macrolide compounds, including solithromycin, from Optimer Pharmaceuticals, a company that is now part of Cubist Pharmaceuticals (NASDAQ: CBST). Cempra went public in 2012, raising $47.7 million for clinical studies of solithromycin as well as another antibiotic candidate, Fusidic acid (Taksta), which is in Phase 2 trials.
The United States government is a partner in solithromycin’s development. Last year the Biomedical Advanced Research and Development Authority (BARDA) awarded Cempra a contract valued at up to $58 million to develop solithromycin in pediatric applications, a market which Fernandes says could be the antibiotic’s largest. Fernandes says an added bonus of the BARDA contract was government help developing and manufacturing a liquid form of the drug for children, which would have been an expensive undertaking for a small biotech company. BARDA is also interested in solithromycin’s broad spectrum of activity against a wide range of bugs, and wants Cempra to develop the antibiotic as a possible defense against bioweapons.
Cempra will apply the $10 million Toyama milestone toward its work on solithromycin. Cempra had already raised money to finance two Phase 3 studies of solithromycin, one of a pill form of the antibiotic and the other an intravenous version. The company has enough cash to last through next year, but Fernandes says it is also thinking ahead to the market research and other work that will need to be done as solithromycin moves toward commercialization. Cempra is still looking for additional partners to market the antibiotic, but the company could keep for itself sales of the drug to hospitals, where Fernandes expects solithromycin could be an alternative to azithromycin.
Cempra is also exploring applications for the drug beyond treating bacterial infections. Cempra is planning a Phase 2 study of solithromycin in patients who have chronic obstructive pulmonary disease. While COPD is not an infection, Fernandes notes that macrolides are sometimes used to treat the respiratory disorder because they have an anti-inflammatory effect.
“People forget that this is not just an antibiotic,” Fernandes says. “It is very useful in these other patients.”