Deinove acquires FDA-Fast Track antibiotic compound
French microbiology specialist Deinove has acquired Morphochem’s Phase II Clostridium difficile antibiotic MCB3837 as part of its acquisition of the Austrian company Biovertis. Morphochem is Biovertis’ German subsidiary.
MCB3837 is a water-soluble injectable small-molecule prodrug of the active substance MCB3681, which is being developed for the treatment of Clostridium difficile gastrointestinal infections (CDI), one of 12 priority pathogens listed by the WHO and the CDC. The novel antibiotic has been granted Qualified Infectious Disease Product (QIDP) status and FDA Fast Track designation, and is ready for Phase II testing.
Deinove will acquire Biovertis and its wholly-owned subsidiary Morphochem without paying any cash but through an in-kind contribution of the company’s major shareholder TVM Capital and other shareholders, who will become Deinove shareholders through the transaction within Article L. 225-147 of the French Commercial Code. Two investment funds managed by TVM Capital hold 82.98% of the contributed rights, will receive 500,001 Deinove shares to which will be attached 8 million warrants (Bons d’attribution d’actions, BAA). The total value of the rights amounts to €900,001.80.
Following the contribution, the 500,001 new shares issued as part compensation for this contribution with the start of MCB3837 Phase II testing will represent 4.06% of Deinove ‘s capital after the transaction.
The 8 million warrants, entitling the holder to a maximum of 8 million new Deinove shares, will only be exercisable by their holders in the event of reaching various milestones in the development of the drug candidate. Therefore, the exercise of the warrants is conditional on achieving highly value creating milestones for Deinove alongside the development of the targeted antibiotic compound.
The transaction adds to Deinove’s AGIR discovery programme of new antibiotics and its recent agreement with RedX Pharma. The US Center for Disease Control and Prevention recently identified CDI as one of the leading causes of healthcare-associated infections, even ahead of MRSA. In 2011, about half a million Americans were infected and more than 29 000 patients died within 30 days following the diagnosis. According to estimates, there will be 1.5 million cases of CDI in the US and Europe by 2021.
In Phase I trials MCB3837 has demonstrated the ability to eliminate Clostridium difficile bacteria without destroying other microorganisms of the gastrointestinal flora. It showed an acceptable tolerance profile. Dweinove plans to conduct a Phase II clinical trial on a small number of patients next. Green light has already been given by the FDA for the initiation of this study.