Maryland News Desk

Acurx Pharmaceuticals (NasdaqCM: ACXP) provided more good news related to its ongoing clinical trial evaluating ibezapolstat, its orally administered antibiotic being developed as a Gram-Positive Selective Spectrum (GPSS™) antibacterial. Two presentations, one a scientific oral presentation and the other a poster, highlighted new information about its lead antibiotic ibezapolstat and its selectivity against Gram-positive gut microbiota at the Infectious Disease Society of America (IDSA) IDWeek™ 2022 Conference in Washington, DC. Staying in line with precedent, the October update was impressive. 

In fact, the data presented for this FDA QIDP and Fast Track Designated for priority review candidate further validates its potential as a game-changing treatment for patients with debilitating infections, including its primary target, C. difficile. And the potentially better news is that ACXP is continuing to enroll patients in the Ph2b trial in up to 30 U.S. sites comparing the efficacy of ibezapolstat to the standard-of-care vancomycin. Results from those studies could put additional catalysts in the near-term crosshairs. But the here and now is worthy of attention.

ACXP also recently announced completing certain portions of its laboratory study at the University of Houston comparing the killing effect of ibezapolstat to vancomycin, fidaxomicin, and metronidazole using both in vitro and ex vivo analyses. The company presented some of those results at Anaerobe 2022, the Anaerobe Society of America annual scientific conference, which demonstrated that ibezapolstat has favorable killing kinetics compared to vancomycin to treat C. difficile infection at standard and high bacterial concentrations. Those findings support the continued development of ibezapolstat as a potential first-in-class antibiotic to treat C. difficile infection. Vancomycin is the current standard of care.

To date, ACXP’s ibezapolstat is besting vancomycin on multiple fronts. 

A Changing Of The Antibiotics Guard

But that shouldn’t be surprising. Vancomycin is part of old-school antibiotics and is in a class of drugs that haven’t changed in roughly forty years. And while it can provide at least some comfort to patients, it’s far from being the type of drug needed- a curative one. And that’s where ACXP’s ibezapolstat differs. 

The following is technical language, but it’s excellent news for ACXP and its ongoing trial. Recent poster presentations assessed by qPCR and metagenomic sequencing analysis showed that colonic microbiome Firmicute bacterial populations consistently demonstrated preservation or increased abundance of Lachnospiraceae and Clostridiales throughout ibezapolstat treatment. That’s advantage #1. There’s more to like.

These emerging data also show that the potentially beneficial bacterial species from C. coccoidies and C. septum groups are preserved in healthy subjects and CDI patients during the dosing of ibezapolstat. This persistence or regrowth of healthy microbiota species is associated with beneficial physiologic effects such as maintaining secondary bile acids, which are known to protect against CDI recurrence. The data is earning praise.

Kevin Garey, PharmD, MS, FIDSA Professor and Chair, University of Houston College of Pharmacy, said, “The unexpected finding from further analysis of the Ph2a study is that the beneficial Firmicutes were shown to regrow while patients were receiving ibezapolstat therapy. We have done several follow-up experiments and demonstrated that many of these beneficial Firmicutes have heterogeneous susceptibility to ibezapolstat allowing them to continue to perform their beneficial biologic functions even while a patient is receiving ibezapolstat for their C. difficile infection.” He further stated: “The totality of the data, including the pioneering vancomycin-controlled healthy volunteer study, suggests that ibezapolstat’s effects on the gut microbiome could be predictive of an anti-recurrence effect in CDI patients.”

In other words, ibezapolstat can be curative. No other known clinical trial candidate for treating C. difficile can make a similar claim. In fact, quite the contrary.

A Thinning Competitive Landscape Gives Advantage To ACXP

Over the past decade, disappointing clinical results in treating CDI have led several big pharma companies to drop off the clinical radar. Those still pursuing its CDI treatment candidate may be doing so with hopes of potentially treating, at best, niche indications of the infection. The string of disappointing data includes that from Pfizer (NYSE: PFE), who missed meeting its primary endpoints in its Phase 3 CLOVER trial to treat C. difficile. But they aren’t the only ones disappointed. 

Sanofi (NYSE: SNY) missed its endpoints in 2017, and more recently, Summit Therapeutics (NYSE: SMMT) published topline results that were far from impressive. Summit’s miss resulted in them trying to change the primary endpoints in its Phase 3 trial, something the FDA didn’t accommodate. Those three weren’t the only ones disappointed to date. Another pharmaceutical company, Finch Therapeutics (NASDAQ: FNCH), saw a setback when it received a clinical hold letter from the FDA about concerns over its SARS-CoV-2 donor screening protocols. While Finch announced that the FDA hold was lifted and enrollment resuming in 2H 2022, they still lost considerable clinical momentum. 

It’s fair to point out that FNCH’s Phase 2 data scored better than Pfizer, Sanofi, and Summit. It showed that 80.3% of trial participants receiving a single administration of its candidate following standard-of-care antibiotics achieved sustained clinical cures through eight weeks. Impressive, yes. Compared to ACXP data? Not even close.

ACXP’s Ibezapolstat Shows 100% Curative Potential 

Acurx’s ibezapolstat candidate published Phase 2a data showing it to be significantly better. Compared to Finch’s candidate, which focuses on the microbiome as a single dimension and has only demonstrated a reduction in recurrent infection, the most significant advantage and point of superiority of ibezapolstat are that it’s a dual-impact drug that addresses the direct infection and, to date, avoids recurrent infection altogether. More importantly, it restores the microbiome, a critical consideration. 

The comparison to Finch’s drug is appropriate because they may be the furthest along from a potential competitive perspective. They also justify a persuasive and data-justified argument that ACXP’s candidate is seemingly better than Finch’s one-dimension drug in cases of multiple recurrent infections. If that’s the case, and current data points that way, ACXP’s candidate could be the most ideally positioned treatment candidate to earn preferred first-line treatment designation. 

Incidentally, besides Finch’s, no other candidate looks close to emerging as a serious competitive threat to ACXP’s ibezapolstat’s targeted front-line position. That’s why others may need to pay to play. In other words, partnership deals could be in ACXP’s future. Those not interested in collaborating may find competing exceptionally hard. So, who may want to partner with ACXP? Many might want to, but pharma giant Pfizer (NYSE: PFE) may be the company to win ACXP’s attention. 

Is A Pfizer Partnership In The Crosshairs?

Actually, speculation is that Pfizer could be the first to call. And they have excellent reasons to do so. During their CLOVER trial update commentary, which missed primary endpoints, they expressed interest in staying committed to pursuing the over one billion dollar market opportunity. But interest and ability are two different clinical beings, and in the drug industry, only the latter matters. 

And keep in mind that PFE is blinded by unwarranted optimism about its CLOVER trial data. They are well aware the candidate failed to meet endpoints. It’s also fair to suggest that they realize that if its candidate gets approved, it would likely be relegated to treating fringe and niche CDI treatment indications. Therefore, while no investor should put it past PFE to spend up to hundreds of millions of dollars more to advance and commercialize an unpromising drug, more savvy ones are considering PFE’s best course of action may be to partner and potentially capture a significant portion of the entire billion-dollar market opportunity. 

That consideration puts ACXP in a win-win scenario. Yes, grant funding, certainly in play, can eliminate many obstacles. But partnerships can too. And while having partners can dilute earnings after marketing approval, they add immediate value, potentially eliminate all ongoing trial costs, and add a level of experience in getting drugs approved. For ACXP investors, the trade-off would be well worth the interest. However, it may not be as much as many think.

With best-in-class data, ACXP could bargain from a position of strength. Remember, its data supports the potential for ibezapolstat to become the front-line therapy to treat over 500,000 patients who get CDI yearly. Of those 500,000, more than 20,000 patients die per year. So, while using the term infection, don’t underestimate its potential 4% outcome. CDI can be fatal. For ACXP, it can mean a significant appreciation for its drug and its stock.

Reasons for outside interest and appreciation are warranted. 

A Best-In-Class Treatment Candidate

In addition to superior treatment potential, ibezapolstat is also the first of a new class of DNA polymerase IIIC inhibitors under development by Acurx to treat bacterial infections. Ibezapolstat’s unique spectrum of activity, which includes C. difficile but spares other Firmicutes and the important Actinobacteria phyla, appears to contribute to maintaining a healthy gut microbiome. That last part is a significant differentiator and is often the difference between cure and relapse.

There are other differences, which are also advantages. ACXP’s Phase 2a trial demonstrated 100% clinical and 100% sustained clinical cures in patients with C. difficile Infection (CDI). That’s not all. It also showed beneficial microbiome changes during treatment, including overgrowth of Actinobacteria and Firmicutes phylum species while on therapy and new findings demonstrating potentially beneficial effects on bile acid metabolism. 

That data has helped expedite ACXP’s move to a Phase 2b 64-patient, randomized (1-to-1), non-inferiority, double-blind trial of oral ibezapolstat compared to oral vancomycin, a standard of care to treat CDI. If results post as expected, ibezapolstat could quickly emerge as the first-line treatment for C. diff. That could happen sooner than later, noting that ibezapolstat was designated by the U.S. Food and Drug Administration (FDA) as a Qualified Infectious Disease Product (QIDP) for treating patients with CDI. Further, its Ph2a data was so impressive that it led the Trial Oversight Committee and the Scientific Advisory Board to allow for early termination of its Phase 2a trial and advance straight into a Phase 2b study. That allowance was made after data on ten patients showed a 100% cure rate and 100% sustained cure after follow-up. 

And the Trial Oversight Committee doesn’t appear to be the only one impressed. The FDA may be as well, having granted ACXP a Qualified Infectious Disease Product (QIDP) and a fast-track designation for its ibezapolstat treatment candidate. That’s potentially excellent news for patients, noting that an approved version of ibezapolstat could perform exceedingly better than the current standard of care, Vancomycin, which has a recurrent infection rate of up to 40% with little evidence showing its value as an effective long-term treatment.

A Massive Market Opportunity

If approved, ibezapolstat would likely meet overwhelming demand. A 2017 update of the Clinical Practice Guidelines for C. difficile infection by the Infectious Diseases Society of America (IDSA) and Society or Healthcare Epidemiology of America (SHEA) indicates that C. difficile infection presents a significant problem to those in healthcare settings and among the general population. The disease is so prevalent in hospitals and long-term care facilities that the New England Journal of Medicine called C. difficile one of the most common causes of healthcare-associated infections in hospitals.

Other prestigious publications are also bullish on ibezapolstats potential. Data published from ACXP’s Phase 2a trial in Clinical Infectious Diseases, one of the most respected journals in the medical community, indicates that ibezapolstat could be deserving of the front-line treatment crown. According to the article, ibezapolstat showed ideal traits as an oral antibiotics candidate, demonstrating a highly potent response against C. difficile, good tolerability, and limited gastrointestinal absorption. That resulted in very high fecal concentrations, which may reach three orders of magnitude above the MIC for C. difficile.

The article further noted that in addition to the ibezapolstat treatment being highly effective at killing C. difficile, it appears to do so while maintaining the populations of helpful bacteria in the gut microbiome. These signs indicate that the treatment may do more than cure CDI in the short term; it can significantly reduce the likelihood of recurrent infection. 

Under The Radar, But Maybe Not For Long

Thus, all tolled, ACXPs under the radar status may not last much longer. That means investment consideration at current levels is indeed warranted. In fact, trading ahead of the next data batch may be the wisest consideration, noting that small-cap biotechs can have quick changes in fortune. Another development-stage biotech, Actinium (NYSE-Amer: ATNM), is seeing its share price explode higher after reporting positive data in its ongoing trials. Like ACXP, they also target treatment for underserved and unmet medical needs.

Moreover, when small-cap biotechs have the potential to become large-caps, expect Big Pharma to pay much closer attention. They don’t like competition. And to keep it at bay, they partner or acquire, either potential scenario boding well for ACXP. That could happen sooner than later. 

Remember that valuations for a Phase 3 drug company compared to a Phase 2 can amount to hundreds of millions in difference. In other words, as ACXP approaches that milestone, they may already be in play and, at current prices, appreciably undervalued. Thus, as ACXP gets closer to making that leap and noting its trials are short in duration, expecting ACXP stock to move higher is a well-leveraged bet. In fact, rising about 10% in October, that bet is already paying off.

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