Soon To Start Antibiotic Trial In China, MicuRx Gets $25M For U.S. Testing
This article was originally published in The Pink Sheet Daily
Executive Summary
A six-year-old start-up founded by Vicuron veterans has strong preclinical and Phase I data for a novel antibiotic targeting Gram-positive infections. Its cross-border approach will soon support two mid-stage trials.
Chinese-American antibiotic developer MicuRx Pharmaceuticals Inc. has raised $25 million in Series B cash intended to fund Phase II trials for its lead candidate, an oral oxazolidinone compound for Gram-positive infections.
BVCF, a private equity and growth capital firm also known as BioVeda China, led the new round alongside existing investors Morningside Group and Devon Park Bioventures. It’s MicuRx’s first equity funding since its $12 million Series A round in 2007. The start-up also received an upfront payment of undisclosed size as part of a defunct 2010 partnership with Pfizer Inc.
MicuRx’s lead program, MRX-I, is entering Phase II trials on both sides of the Pacific to study its effectiveness on methicillin-resistant Staphylococcus aureus and vancomycin-resistant enterococci infections. Last October, the company entered into a joint venture with Shanghai Zhangjiang Biomedical Industry Venture Capital to create Shanghai MengKe Pharmaceuticals Inc., the entity which now owns Chinese rights to the antibiotic. MicuRx kept a controlling stake in Shanghai MengKe, while the financial firm invested RMB 60 million ($9.6 million) to fund clinical trials and a New Drug Application in China. MicuRx CEO Zhengyu Yuan said the first Phase II trial will begin “shortly” in China.
The new venture money will support U.S. trials. MicuRx maintains an American headquarters in Hayward, Calif., as well as a research facility in Shanghai. Yuan said a Phase II U.S. study of MRX-I will begin next year.
Phase I data showed MRX-I was safe and well-tolerated, and did not produce myelosuppression, a common effect of oxazolidinone antibiotics. The company also said that in preclinical studies in vivo, the candidate was twice as efficacious as Pfizer’s Zyvox (linezolid) in treating methicillin-resistant Staphylococcus aureus infections. Zyvox and Cubist’s Cubicin (daptomycin) are alternatives to the generic, intravenous vancomycin, the most commonly prescribed antibiotic for MRSA infections. Novel options are gaining market share as the bug gains resistance to vancomycin, reducing the drug's efficacy (Also see "Antibiotic Market Snapshot: In Exchange For Higher Prices, More Value" - Pink Sheet, 14 Jan, 2013.).
MicuRx touts MRX-I’s oral availability and safety profile as advantages over the other drugs. Cubicin is only administered intravenously, while Zyvox can be either oral or IV. Yuan stressed that Phase I studies are highly risky for antibiotics, but said U.S. regulators only would need to see a bridging study of an additional patient population, now that MicuRx has safety data from an early stage trial in China.
Despite a lag of several months before the U.S. Phase II trial begins, Yuan said the Chinese and American studies are essentially parallel. Conversations with FDA have not yet begun concerning the U.S. trial’s design and endpoints, but Yuan said he expects that dialogue to begin now that MicuRx has secured funding.
A Model Designed For Inexpensive Research
Yuan said MicuRx’s hybrid, cross-border discovery and development model has proven to be capital efficient. He pointed to the high development costs incurred by his previous employer, Vicuron Pharmaceuticals Inc., prior to its $1.9 billion acquisition by Pfizer in 2005, and said MicuRx was designed to save money by having a small U.S. team direct Shanghai operations from afar. Other start-ups such as Ascletis Inc.also have pursued cross-border models with capital efficiency in mind (Also see "Ascletis Raises $100MM To Deploy Its U.S.-China Hybrid Drug Development Model," - Pink Sheet, 6 Apr, 2011.).
BVCF typically invests in Chinese life sciences companies valued between $50 million and $100 million. Among the two early investors, Morningside Group also has deep Chinese roots; the international firm is the investment arm of the Hong Kong-based Chan family, including Hang Lung Group chairman Ronnie Chan (Also see "Morningside Group" - Scrip, 30 Nov, 2011.).
Yuan noted positive data will make MicuRx an attractive target for acquirers or a likely recipient of Series C financing; the company hasn’t ruled out another geographic partnership.
MicuRx’s partnership with Pfizer was a discovery and development deal for drug-resistant tuberculosis antibiotics. Although the biotech received an upfront payment and research funding from Pfizer, the two-year deal expired in 2012 and Pfizer has since lost interest in novel antibiotic research and development (Also see "Pfizer Draws Curtain On Anti-infective Research; Refocuses On Next-gen Vaccines" - Scrip, 13 May, 2013.).
MicuRx also had a secondary program targeting Gram-positive infections, MRX-II, that functioned as a backup candidate to MRX-I. Yuan said that positive Phase I data from MRX-I has obviated the need for further research on MRX-II. Future discovery will be largely dedicated to antibiotics targeting Gram-negative bacteria, an area with comparatively fewer novel products under research (Also see "Anti-Infective Start-Ups See Opportunity In An Epidemiological Nightmare" - Scrip, 26 Nov, 2012.).