Gaithersburg’s Adaptive Phage Therapeutics Inc. has closed a hefty Series B round after first signaling the raise last year, a big win after a lack of funding stalled its effort to treat Covid-19 patients with secondary infections.
The company, whose technology attacks superbugs, said Tuesday it has secured $40.75 million to speed up clinical development of its therapies for drug-resistant pathogens, as well as for general corporate purposes.
Specifically, that involves advancing programs in prosthetic joint infection and diabetic foot osteomyelitis, in which soft tissue infections spread to the bone and may require amputation. The business also plans to use the funds to develop a rapid test for identifying which “phage,” or virus-based, therapies would effectively attack certain bacterial infections.
Deerfield Management Co. led the round, according to APT. The Mayo Clinic, an existing investor, and another undisclosed institutional investor also participated.
Last summer, Adaptive Phage co-founder and CEO Greg Merril said the $7 million round was a precursor to a $30 million Series B round it would launch in 2020. He subsequently declined to comment on the status of any investments.
The latest funding more than doubles Adaptive Phage’s $38 million in total investments up to this point. That included a $7 million round in 2019 and a $10.2 million contract with the Department of Defense.
The fast-growing business, which counted 35 employees in March, is on track to double that headcount to 70 people “within the next few months,” Merril said in an email Tuesday. It’s actively recruiting to fill more than 25 open positions, primarily in clinical operations and pharmaceutical manufacturing, including quality assurance and quality control roles, he said.
The new capital comes a couple of months after the Food and Drug Administration gave APT the go-ahead to kick off clinical trials for its therapy for diabetic foot ulcers with bone infections.
APT, whose PhageBank platform technology attacks bacteria that don’t respond to antibiotics, also has the agency’s green light to initiate clinical studies for its therapy in prosthetic joint infections and urinary tract infections. The company is aiming to reach pivotal trials by the end of next year and, if successful, would then seek FDA approval, Merril said in an email.
Adaptive Phage also earned in November the FDA’s OK to test its therapy in Covid-19 patients with bacterial lung infections. But the company needed financial support from the government to do it — and that funding still hasn’t panned out. So despite its latest capital infusion, Merril confirmed the company is not currently enrolling patients with coronavirus for a trial.
The clinical-stage biotech, whose revenue at this point comes mainly from advanced development contracts with the Department of Defense, counted $7 million in revenue for 2020 and projects $10 million in revenue for 2021, Merril told us in March. He launched the biotech with his father in 2016 out of National Institutes of Health research in collaboration with the Navy.
