LONDON – Iterum Therapeutics Ltd. has raised $65 million in an oversubscribed series B round to fund phase III development of sulopenem, a treatment in-licensed from Pfizer Inc. for gram-negative multidrug-resistant infections.

A phase III study in uncomplicated urinary tract infections is due to start in the first half of 2018, which, if positive, will lead to an FDA new drug application by the end of 2019. The product also will be tested in complicated urinary tract infections and complicated intra-abdominal infections, within the scope of the series B.

In total, there are more than 25 million infections in those three indications annually in the U.S., and resistance to current fluoroquinolone treatments is on the rise.

The round was led by new investor Arix Bioscience plc, in what was its first investment since raising $127 million in an IPO on the London Stock Exchange in February. (See BioWorld Today, Feb. 3, 2017.)

Other new investors in Dublin-based Iterum are Advent Life Sciences, Domain Associates, Bay City Capital and Pivotal Bioventure Partners. The existing investors, Frazier Healthcare Partners, Canaan Partners, Sofinnova Ventures and New Leaf Venture Partners, who put $40 million into the series A round in November 2015, all followed on. (See BioWorld Today, March 25, 2016.)

Iterum in-licensed sulopenem in late 2015, but did not disclose Pfizer as the erstwhile owner until January 2017. Pfizer received an up-front cash payment and Iterum equity, and is eligible to receive additional equity, development and commercial milestone payments and royalties on sales.

Closing the round is an important milestone, said Corey Fishman, CEO of Iterum. It was "highly competitive and substantially oversubscribed," reflecting the progress made since raising the series A and in-licensing sulopenem, he said.

Under Pfizer's stewardship an intravenous formulation of sulopenem was tested in more than 1,100 subjects in Japan, in studies dating as far back as 1993. An oral formulation was assessed in a phase IIa 35-patient U.S. study in community-acquired pneumonia that completed in July 2009.

Since acquiring the rights, Iterum has refreshed the preclinical research and done work on manufacturing. In addition, the company has secured FDA qualified infectious disease product (QIDP) designation, giving an extra five years of marketing exclusivity.

Sulopenem demonstrates broad-spectrum in vitro activity against beta-lactamase-producing and quinolone-resistant gram-negative pathogens, which are becoming increasingly prevalent in hospital and community settings.

Arix decided to look for potential anti-infectives investments after conducting an internal analysis of the state of play. That showed that while the development of antimicrobial resistance means medical need is growing, there is now an alignment between the regulation and science, said Joe Anderson, CEO of the London-based health care investment company.

"In gram-negative bacteria, the science is tractable and the regulatory changes help. In particular the GAIN [Generating Antibiotics Now] Act makes it clear what you need to do to get approval, and this has drawn in capital," Anderson told BioWorld Today.

The track record of Iterum's founders also helps. The company is headed by former executives of Durata Therapeutics Inc., which was the first to get a QIDP approval, pushing Dalvance (dalbavancin), another anti-infective formerly owned by Pfizer, over the line in May 2014.

Before that, Dalvance was among several antibiotics that got caught up in changes to FDA guidelines for approving antibiotics.

The drug met its primary endpoint in treating complicated skin infections in a phase III noninferiority study involving more than 800 subjects, but was rebuffed in 2007, when the FDA requested additional data to meet the new guidelines. That prompted Pfizer to spin Dalvance into Durata. (See BioWorld Today, Dec. 23, 2009.)

Following the FDA approval of Dalvance, Dublin-based Actavis plc acquired Durata for $809 million in October 2014. (See BioWorld Today, Oct. 7, 2014.)

The Irish connection was maintained when the Durata team subsequently formed Iterum, choosing Dublin as the headquarters and manufacturing base. The technical operations and R&D are in Old Saybrook, Conn.