The money from CARB-X will allow Redx to move its Gram-negative antibacterial programme into the next stage of development with a prospective partner.
City broker Cantor Fitzgerald said the grant reflects the importance of the antibiotic research being carried out by Redx.
“That this programme has attracted such an award is testament to its innovation and research prowess in the development of novel antibiotics to treat the threat from emerging resistance to Gram-negative bacteria,” wrote analyst Brian White in a note to clients on Friday.
Drug resistant Gram-negative are becoming an increasingly problematic in healthcare settings, White added.
The analyst also points out that to win the award, Redx had to go through a “highly competitive process”. Of the 168 initial applicants, only eleven firms, including Redx, received any form of funding.
“This award is important and timely given that Redx has refocused its business in order to capitalise on its close to clinic candidates in its focus areas of cancer and immunology,” said White.
“Consequently, this external funding allows this important area of research and development to continue.”
The oncology pipeline is still king though, and Redx’s RXC004 first-in-class Porcupine inhibitor programme which targets hard-to-treat cancers is scheduled to enter the clinic later this year.
RXC005 – the best-in-class BTK inhibitor – is set to start clinical trials next year.
White reckons the stock is worth 105p, almost triple its current value.
Shares closed 5% higher at 37.1p on Friday.