Protez Pharmaceuticals Inc. raised $15 million in its Series B round to move into the clinic with its first product, SMP-601, an injectable antibiotic to address drug-resistant hospital infections.
The company licensed the compound in May from Osaka, Japan-based Sumitomo Pharmaceuticals Co. Ltd. SMP-601 is a carbapenem antibiotic, "the newest in a subclass of beta-lactams," said Christopher Cashman, president and CEO of Malvern, Pa.-based Protez.
"A large piece of this money is going to advance the product," which is in preclinical studies now, he said. "Our target is to get it through Phase II."
The financing was led by BioAdvance Ventures, of Philadelphia, and Birchmere Ventures, of Pittsburgh. L Capital Partners, of New York, and West Conshohocken, Pa.-based S.R. One, also participated in this round, along with existing investor BTG, an international venture company with offices in West Conshohocken.
Protez was founded in late 2003, based upon a "growing medical need primarily coming out of the hospital segment," where antibiotics have been losing their efficacy over the last few decades as bacterial strains become more and more resistant, Cashman said.
"The medical community has been really requesting companies to invest in this area," he told BioWorld Today, "and that was kind of our call to action."
The company, which is developing its own product pipeline, has two programs in early preclinical development. The first is a group of agents called potentiators that are designed to work in combination with existing antibiotics to make them more efficacious. A second program focuses on antibiofilm agents aimed at targeting persistent infections, such as endocarditis and persistent urinary tract infections.
The antibiofilm program is being funded by a $2.9 million grant from the National Institutes of Health, which made up part of the company's $4.5 million Series A round completed last year.
With a 15-person employee base, Protez continues "active research efforts to build a pipeline of internally discovered products," Cashman said. "But we wanted to move the company further along by licensing the Sumitomo drug."
Under terms of the agreement, Protez gained exclusive rights to develop and commercialize SMP-601 in North American and Europe, with the option to sublicense, in exchange for undisclosed milestones and royalty payments. Sumitomo retains development rights in Asia.
"This class of compounds is challenging to make," Cashman said. "One of the biggest strengths of SMP-601 is the support we're getting from Sumitomo. They're handling all the manufacturing."
SMP-601, which is in the same class as penicillin, is being designed to combat drug resistance in the hospital setting. The drug has shown activity against a number of pathogens, including the "multidrug-resistant gram-positive segment of the market that has really seen explosive growth," driven by methicillin-resistant Staphylococcus aureus, he said.
Protez is considering its partnering options for the drug, but Cashman said the company might decide to take SMP-601 to the market itself. He said the hospital segment is "reachable for a small company," with a sales force of about 150 people to market the drug in the U.S. and Europe.
The drug's intravenous formulation also was developed with the hospital setting in mind, he added, though Protez has looked at potential indications in skin and soft tissue infections and community-acquired infections.
"We've taken a very measured process here to research our assets," Cashman said. "We're building our base and we've added SMP-601. And now we have the funding to really move forward, so all the pieces are coming together."
Protez also recently added five members to its advisory board: Ting Pau Oei, of L Capital; Kent Gossett, of S.R. One; Peter Sears, of BioAdvance; Jeanne Cunicelli, of San Francisco-based Bay City Capital; and Maria Maccecchini, of Wayne, Pa.-based Robin Hood Ventures. Other members are Cashman; Paul Blake, of Frazer, Pa.-based Cephalon Inc; and Scott Horvitz, of Cranbury, N.J.-based Linguagen Corp.