Motif Bio PLC (LON:MTFB, NASDAQ:MTFB) received a monetary boost – and by extension a vote of confidence in its prospects – as it raised £2.7mln via a share placing.
The cash will fund the business through the coming months as it meets with officials at the US Food & Drug Administration (FDA) to discuss the future of its antibiotic, iclaprim.
The treatment, which was developed to tackle acute bacterial skin infections, was knocked by the FDA last month.
The watchdog wants additional data so it can “further evaluate the risk for liver toxicity” before it decides whether or not to grant new drug approval. As one of Motif’s advisers pointed out, this wasn’t a straight ‘no’. So there may still be some hope.
Of course, Motif is keen “to discuss potential options to address the deficiencies” with the information it had furnished. But ahead of the fundraiser, there had been real concerns the business might run out of cash.
A meeting with the FDA is scheduled for May 3, and the company expects a response a month later.
Proceeds from the placing, which was completed at 6p a share, will provide a financial runway long enough to see it past the date it receives the minutes from the regulator in June.
Chief executive Graham Lumsden said: "We are encouraged by the support shown by both new and existing investors as we strengthen our balance sheet.
“The company now expects to be funded through completion of the FDA meeting and receipt of the minutes, which should provide guidance regarding the path forward for iclaprim."