By David Bautz, PhD
NASDAQ:CFRX
READ THE FULL CFRX RESEARCH REPORT
Business Update
Positive Clinical Data for Exebacase in Patients with Chronic Knee Prosthetic Joint Infections
In September 2022, ContraFect Corp. (NASDAQ:CFRX) announced a presentation by Dr. Tristan Ferry at the 40th Annual Meeting of the European Bone and Joint Infection Society on data from a single center, exploratory, open label prospective study using a minimally invasive LysinDAIR procedure in patients with chronic knee prosthetic joint infections (PJIs).
The presentation included data from two cohorts, with each cohort consisting of four patients with chronic PJIs that received the LysinDAIR procedure (arthroscopic debridement with retention of the implant, followed by intra-articular administration of exebacase and systemic antibiotic therapy).
Cohort one consisted of patients experiencing their first episode of chronic knee PJI. Patients received three months of clindamycin and levofloxacin following the LysinDAIR procedure. Results showed that exebacase was well tolerated by all patients with no local or systemic serious adverse events related to exebacase treatment. Through a period of 36 months of follow up the patients have experienced no relapse of infection, no recurrence of joint effusion, and no loosening of the prostheses.
Cohort two included patients suffering from multi-drug resistant knee PJI. These patients received three months of systemic antibiotics plus additional suppressive antimicrobial therapy following the LysinDAIR procedure. Results for this cohort showed that exebacase was again well tolerated by all patients and no local or systemic events related to exebacase treatment were reported. Two patients experienced no relapse of infection through a follow up periods of up to 12 months. One patient experienced a relapse of infection of Staphylococcus caprae after six months. One patient died from an unrelated COVID-19 infection.
In October 2022, ContraFect presented a poster that included new clinical data for the LysinDAIR procedure in patients with chronic prosthetic hip infection (Ferry et al., 2022). Three patients were included in the study and all had previous iterative hip prosthesis exchange, a high total number of surgeries (6-10), and recent persistent or intermittent fistula. At two years follow up, all patients had resolution of fistula and no clinical signs of infection on suppressive antimicrobial therapy.
A recent editorial in the Journal of Bone and Joint Infections discussed the potential for lysins (exebacase and CF-296) as treatments for bone and joint infections (BJIs) due to their activity against coagulase-negative staphylococci, the bacteria most frequently involved in implant-associated BJIs, and their potential for both local and systemic anti-biofilm activity (Sendi et al., 2022). Current antibiotic treatments are often unable to resolve these infections, thus the authors postulated that the use of lysins could help to potentiate antibiotic activity and make these types of infections more easily treated.
Another recent publication highlighted the in vitro activity of exebacase against biofilms formed by Staphylococcus epidermidis isolated from PJIs (Souche et al., 2022). Results showed that exebacase displayed significant anti-biomass activity, significant bactericidal activity on biofilms, and worked synergistically with rifampicin, vancomycin, or daptomycin. The authors concluded that exebacase was a promising therapy that should be investigated further for its use in the treatment of PJIs alongside the aforementioned antibiotics.
In October 2022, ContraFect submitted a Clinical Trial Authorization to the French National Agency for the Safety of Medicines and Health Products for a study of intra-articular exebacase in patients with knee PJIs due to Staphylococcus aureus or coagulase-negative staphylococci. Assuming approval of the submission, we anticipate the company will begin dosing patients in the first quarter of 2023 and the first clinical data could be reported in the second half of 2023.
Financial Update
On November 14, 2022, ContraFect announced financial results for the third quarter of 2022. As expected, the company did not report any revenues for the three months ending September 30, 2022. Net loss for the third quarter of 2022 was $17.1 million, or $0.43 per share, compared to a net loss of $5.3 million, or $0.13 per share, for the third quarter of 2021. R&D expenses for the third quarter of 2022 were $10.8 million, compared to $8.7 million for the third quarter of 2021. The increase was primarily due to an increase in spending on clinical activities for the Phase 3 DISRUPT study, an increase in spending on non-clinical studies of CF-370 to support a potential IND application, and the completion of ongoing non-clinical studies of exebacase. G&A expenses for the third quarter of 2022 were $3.4 million, compared to $3.0 million for the third quarter of 2021. The increase was primarily due to increased legal fees and stock-based compensation. The company reported $7.7 million in restructuring expense for the third quarter of 2022, while there was no restructuring expense for the third quarter of 2021. The restructuring plan was designed to reduce costs and align resources with anticipated development milestones for exebacase and CF-370. The expense consisted of employee termination costs and a write-off of prepaid manufacturing costs.
As of September 30, 2022, ContraFect had approximately $17.6 million in cash, cash equivalents, and marketable securities. As of November 11, 2022, the company had approximately 39.3 million shares outstanding and, when factoring in stock options and warrants, a fully diluted share count of approximately 53.2 million.
Conclusion
The results presented this quarter for exebacase in the treatment of PJIs is very encouraging and we look forward to the initiation of a clinical trial in the first quarter of 2023 and the potential for initial data from that study in the second half of 2023. The company is also expected to advance CF-370 for resistant Gram-negative infections and we look forward to updates as it advances toward clinical trials. With no changes to our model, our valuation remains at $3.00 per share.
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