Thursday, October 13, 2011

Cempra Pharmaceuticals files plan for $86M IPO

Drug development company Cempra Pharmaceuticals plans to raise $86.2 million in an initial public offering to pay for late-stage clinical trials on a pair of novel antibiotic compounds targeting drug-resistant bacteria.

The IPO filing comes a month after Chapel Hill-based Cempra announced positive phase 2 results for antibiotic candidate CEM-101, also called Solithromycin, supporting the advance of the compound into phase 3 studies as a pneumonia treatment. Another compound, Taksta, has also completed phase 2 clinical trials and is being studied as a treatment for skin infections, including MRSA (Methicillin-resistant Staphylococcus).

Cempra does not yet have any Food and Drug Administration-approved products. Its compounds are targeting an antibiotics market that according to Datamonitor totaled $19.6 billion in the United States, Japan and the five major European markets in 2009. More than half of that total was spent in the United States. The leading MRSA antibiotics vancomycin and daptomycin totaled $1.1 billion in 2010 U.S. sales, according to IMS Health and pharmaceutical company data.

While the antibiotic market is a competitive space, Cempra said that the current slate of antibiotics don’t adequately fight all of the types of bacteria involved in a particular disease. The company adds that its compounds can address the growing threat of antibiotic resistance with new treatments that are safer and easier to administer. In addition to dangerous side effects, many of the antibiotics currently used to fight serious infections must be administered intravenously, which requires treatment in a hospital. “The clinical data we have generated suggest that CEM-101 and Taksta address each of these challenges,” Cempra said in the filing. “As a result, we believe CEM-101 and Taksta have the potential to meet this large and growing need.”

Cempra had been considering working with a pharmaceutical partner on further clinical development of its antibiotics compounds. Cempra needs to raise money chiefly because it now plans to move forward on its own with four phase 3 clinical trials – three for solithromycin and one for Taksta. Solithromycin is also expected to go through an additional phase 2 study. Filings show that Cempra has just $9.7 million in cash and equivalents.

Cempra explains that Solithromycin will need three phase 3 trials studying the compound for community-acquired bacterial pneumonia: one with an oral version of the drug candidate and two others with an intravenous formulation stepping down to oral. Before conducting the IV-to-oral phase 3 studies, Cempra plans an IV-to-oral phase 2, expected to be completed by the end of 2012.

Cempra has already completed an end of phase 2 meeting with the FDA for Taksta. The company plans to start phase 3 studies on that compound in the second half of 2012.
Cempra was founded in 2008 and has raised $78.4 million in venture capital from Sofinova Ventures, Quaker Partners, Intersouth Partners and Aisling Capital. Cempra’s research focuses on macrolides, a class of compounds that have produced antibiotics against an array of non-infectious diseases. Cempra has a macrolide library of more than 500 compounds with the potential of addressing conditions such as inflammatory diseases, endocrine diseases and gastric motility disorders. But to date, Cempra has devoted its resources primarily to developing antibiotics.

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