Cidara Therapeutics announced several sweeping moves on Wednesday afternoon to bring an influenza drug back in-house and raise money from investors to back the program.
The San Diego biotech said it will reacquire the flu drug candidate, CD388, from Johnson & Johnson after a deal with the drug giant three years ago. J&J bet $27 million upfront on the program, plus milestones, at a time when the pharma company was rolling out its Covid-19 vaccine and the industry was looking at treating other viruses. Cidara says it thinks that CD388 can prevent “all strains of influenza A and B.”
To get the candidate through Phase 2b, Cidara has tapped investors for $240 million in a PIPE deal, reloading a balance sheet that showed cash and equivalents of $35.8 million at the end of 2023.
Jeffrey SteinLast year, J&J pulled back some of its R&D work in infectious disease, and flu has proven to be a particularly difficult area of drug development that’s led to setbacks for other attempts to prevent flu. While J&J had elected to move forward with a Phase 2b for CD388, and paid Cidara a milestone, it later decided to divest the program, CEO Jeffrey Stein told Endpoints News in an interview.
Instead of watching the drug go to another pharma company, Cidara decided to buy it back.
“It was a competitive process with a program that is potentially transformational as a universal influenza preventative that is effective against all strains and in all people,” Stein said.
RA Capital Management, a firm that has participated in multiple similar deals in recent months, led the PIPE financing that backed the deal. Stein said the company has been speaking with RA since last fall. Bain Capital Life Sciences, Biotech Value Fund and Canaan Partners also took part.
Laura TadvalkarCidara said the financing went toward the $85 million it owes upfront to J&J as part of the reacquisition. The new money will keep operations going beyond the Phase 2b topline data. Stein said the company will disclose more specifics on runway at a later date.
The Phase 2b trial will take place later this year in the Northern Hemisphere influenza season, and the money can help carry it through longer into the Southern Hemisphere influenza season if needed, Stein said in the interview.
Meanwhile, Mundipharma bought the rights to Cidara’s Rezzayo (rezafungin), which the FDA approved in March 2023. Mundipharma already had rights to the drug outside of the US and Japan, and it was approved in the EU and UK in December and January, respectively.
Cidara said the move is expected to save it $128 million thanks to reductions in CMC spending and clinical development, which includes a Phase 3 trial in China. It will also make way for Cidara’s expansion into oncology, Stein told Endpoints.
Alongside the pipeline adjustments, Cidara said board members David Gollaher and Timothy Franson will step down. RA Capital managing director Laura Tadvalkar will join the board with Ryan Spencer and James Merson, who was the previous global head of infectious disease therapeutics at J&J’s Janssen.