BioWorld International Correspondent

Basilea Pharmaceutica AG, an antibiotic development company spun out of F. Hoffmann-La Roche Ltd. in October 2000, is moving its novel cephalosporin BAL5788 into a Phase III trial, following a successful Phase II study of the drug in patients with complicated skin and skin-structure infections.

The Basel, Switzerland-based firm also is launching an initial public offering in Switzerland, combined with a private placing of shares with overseas investors. It has not revealed details of that transaction.

BAL5788, which received fast-track designation from the FDA 12 months ago, exhibits broad-spectrum activity against a range of Gram-positive and Gram-negative bacterial pathogens, including methicillin-resistant Staphylococcus aureus (MRSA). (See BioWorld International, March 12, 2003.)

It has yet to release the full Phase II trial data, but the company said that each of the 35 evaluable participants was cured and exhibited rapid clinical improvement within days of treatment. "You could say it was a 100 percent response rate," company spokesman Sean Wells told BioWorld International.

Wells said the Phase III trial is expected to begin in the second half of this year. Roche, also of Basel, has an option on the product, which it has yet to exercise. "It's a win-win situation because Roche has a right to opt in 30 days after they receive a [Phase II] data package," Wells said.

The market for MRSA antibiotics grew by 23 percent on average from 1999 through 2003, Wells said. However, he added that existing anti-MRSA drugs have a narrow spectrum of activity and are therefore administered only following positive identification of the bacterium. Because of its broad spectrum, BAL5788 can be administered to patients before microbiological analysis is completed. "We think it's going to be an attractive product for the hospital market," he said.

Roche is Basilea's largest shareholder, with 46 percent of its equity. It held options on Basilea's pipeline of five compounds at founding. Two of them have been discontinued, Wells said, while Roche has decided not to take its option on BAL4079, an oral treatment for patients with chronic hand dermatitis refractory to topical therapy. That also is due to enter a Phase III trial in the second half of this year, while an antifungal compound, BAL8557, is due to enter a Phase II trial in the same time frame.