Motif Bio is to sell antibiotic iclaprim after FDA setback
US regulator requested a new trial after concerns over toxicity
Company will wind down US business and become a cash shell
Motif says a new trial for iclaprim will cost tens of millions of dollars.
Instead, it is proposing to sell iclaprim, its main asset, as part of a root and branch reorganisation of the company.
The drug developer had been talking with the US regulator following queries over its phase III clinical trial.
Minutes of a Type B meeting between Motif and Food and Drug Administration in September have been published.
They reveal a single well-designed adequate and well-controlled Phase III clinical trial demonstrating safety and efficacy of iclaprim in patients with bacterial pneumonia (HABP/VABP), along with data on potential mechanisms of hepatic injury, would enable submission of a New Drug Application.
And while Motif is confident there is a path to market for iclaprim, it will require a company with deeper pockets to take the putative treatment further.
“It would take several years to enrol and complete a HABP/VABP phase III trial and the cost is expected to be tens of millions of dollars,” said CEO Graham Lumsden.
“We believe that the most efficient way to generate future value from iclaprim is for a partner or other entity with a lower cost of capital to complete the HABP/VABP Phase III trial and commercialise the asset globally.”
Cash shell arrangements
In January 2020, Motif came to an arrangement with Hercules Capital, its senior secured lender.
Once it has officially been designated as a cash shell, which will happen once the agreement with Hercules becomes effective, the company will have six months to execute a reverse takeover, otherwise, its AIM listing will be suspended.
Motif’s US subsidiary, Motif Biosciences Inc has ceased all operations and has engaged Tamarack Associates to facilitate the sale of iclaprim and other assets.
Hercules Capital, meanwhile, has scrapped the loan agreement it made with Motif Bio in November 2017 in return for which Motif Inc has granted Hercules a perfected lien over its intellectual property.
Motif is granting Hercules warrants over 121.3mln shares – roughly 25% of the issued share capital – that will expire on 27 January 2025 if not exercised before then at 0.42p a share.