Biotech Battles Bacterial Threats

07/15/2016 8:00 am EST

Focus: STOCKS

John McCamant

Editor, Medical Technology Stock Letter

Carbavance is targeted at the most deadly and insidious of bacterial threats, namely Carbapenem Resistant Enterobacteriaceae (CRE), explains biotech expert John McCamant, editor of The Medical technology Stock Letter.

Carbapenems are broad-spectrum antibiotics that kill bacteria; but many bacteria have developed resistance to carbapenems and efforts to combine those antibiotics with drugs to restore bacterial sensitivity have been unsuccessful.

Healthy people are rarely affected. CRE germs often strike people receiving medical care in hospitals or nursing homes, including patients on breathing machines or dependent on catheters.

The Medicines Co. (MDCO) – via its acquisition of Rempex – has designed Carbavance, which is a beta lactamase inhibitor that restored carbapenem activity.

The company currently has two ongoing TANGO (Targeting Antibiotic Non-susceptible Gram-negative Organisms) Phase III clinical trials.

With positive results, Carbavance is expected to become the first approval for MDCO's high-value-added assets.

About two million Americans fall ill from antibiotic-resistant bacteria every year and at least 23,000 die from those infections. There are over 1 million carbapenem resistant infections worldwide every year.

Therefore, a $1 billion global market exists should the drug be given a $1,000 per treatment price tag. We believe that price assumption is conservative.

The Obama administration has made addressing resistant bugs a major goal –- including speeding up the approval of new antimicrobial drugs with a program Qualified Infectious Disease Product (QIDP).

Carbavance was awarded both the FDA’s QIDP qualification in January and Fast Track designation in April that will speed up review and approval time.

Meanwhile, The Medicine Co.'s ORION-1 study of PCSK9si is ahead of schedule; the trial focuses on patients with high cardiovascular risk and high LDL-C (“bad cholesterol”) despite current treatment.

Repatha — a product from Amgen (AMGN) -- is coming soon; its study is due to be released by Q3.This is a major trial that will determine the future of a potential blockbuster class of compounds.

MDCO shares will certainly be impacted by this data as most investors believe this compound to be the most important of the MDCO pipeline, and we do not disagree.

Investors have practically ignored the potential of Carbavance in MDCO’s valuation, but we do not. Indeed, it may now be the first product in MDCO’s pipeline to gain FDA approval, likely in 2017.

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