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A Look Into Cempra's Pipeline

|Includes:Cempra, Inc. (CEMP)

Like many small-cap biotech companies, Cempra, Inc. (NASDAQ: CEMP) is a clinical stage company with its focus set on developing antibiotics to treat drug-resistant bacterial infections. First thing to note is that this company is in a somewhat difficult business. Developing treatments for infections that aren't drug-resistant is difficult. If this company has the right strategy in place, it may well become successful. In this article I'll examine its present drug candidates to get an idea if Cempra is headed in the right direction. Cempra currently has two pipeline candidates: Solithromycin and Taksta. Just before the end of 2013, the company provided updates on clinical developments for each these drugs.

More on Solithromycin

This pipeline candidate is being developed for the treatment of community-acquired bacterial pneumonia (CABP) and gonorrhea. The market potential of this drug candidate is huge, as this sort of drug is something that the world needs very much. According toacademicians, CABP is the most frequently occurring infectious disease in the U.S. It's also regarded as the sixth most common cause of death. If that's the case in the U.S., where healthcare is reliable, imagine what it is like in countries with less than acceptable healthcare systems.

Two different clinical trials are ongoing for this drug, each of them standing for the mode administration. The first is for oral administration and the second is for intravenous administration. In addition, a third clinical trial for pediatric administration should begin in future. That this drug has the potential of being administered through various means makes its potential market even bigger. It means that Solithromycin can be used for treating most CABP patients. So far, there haven't been reports of major safety concerns with this candidate.

More on Taksta

Taksta is being developed for the treatment of prosthetic joint infections (PJI). According to experts, PJI is a devastating complication with high morbidity. Cempra has recently provided results about the ongoing Phase 2 study for this candidate. According to the company, the primary endpoint was infection free after twelve weeks after the initiation of therapy. However, a somewhat negative side to it is that of the 21 subjects that were enrolled, 13 were dropped from the study for various reasons, including not growing a positive culture. You cannot expect everybody to use a drug, but the proportion of patients that had to be dropped here is not encouraging.

However, something that restores a bit of belief is the fact that the FDA granted this drug candidate orphan drug designation in Oct 2013. This qualifies Cempra for a 50 percent clinical cost tax credit and a PDUFA fee waiver as well as seven years statutory market exclusivity.

Conclusion

From above, it's easy to say that Cempra's pipeline is progressing and 2014 should be the year that makes clearer the future of Cempra. Therefore, investors should watch for new developments regarding Taksta and Solithromycin, as they could be helpful in making the right investment decisions.

Stocks: CEMP