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Acurx Pharmaceuticals Draws Interest After Morning IPO; Could Deliver First Class Of New Antibiotics Since The 1980’s (Nasdaq: ACXP)

By all means, pay attention to Acurx Pharmaceuticals (NASDAQ: ACXP). And if you can't get shares as part of the IPO this morning, consider investment shortly after the stock lists. Why? Because this company is on a mission to deliver the first new class of antibiotics since the 1980s. Better still, while no one wants to hear this, they are advancing drugs in preparation to meet the next Infectious Disease Pandemic by breaking through current antibiotic resistance. (Nasdaq: ACXP)

Moreover, Acurx is prepared to hit the ground running. They already have a Phase 2b clinical trial of ibezapolstat targeting treatment of C. difficile (CDI) as a front line option, are advancing pre-clinical development for potential new antibiotic candidates in scientific collaboration with WuXi AppTec, and is completing manufacturing and formulation of ACX-375C to treat Gram-positive infections. In addition, they are advancing its CCP1 through the discovery phase to develop multiple product candidates to treat a variety of other gram-positive infections.

Thus, as always, not all IPO's are created equally. And this one has built-in intrinsic value. Better still, its planned raise of $15 million and NASDAQ listing could help accelerate the development of its programs. And that could make for a busy back half of 2021. Moreover, it can create potentially enormous shareholder value for early investors.

Targeting Gram-Positive Bacteria

The IPO Friday comes after an ambitious four years of study. Founded in 2017, Acurx intends to develop a new class of antibiotics to address the global crisis of antimicrobial resistance in Gram-positive bacteria, with its initial focus on treating CDI. The excellent news for investors is that the company is blazing its own trail.

In fact, by using DNA polymerase IIIC inhibitors, Acurx is planning to deliver to market a first-line treatment for C. difficile, a debilitating germ that causes severe diarrhea and colitis. The market is already substantial, with the CDC classifying CDI as an urgent threat requiring new antibiotic development. In fact, the current standard of care uses decades-old antibiotics with recurrent infection of between 20% - 40% and antibiotic resistance that necessitates the rapid development of alternative treatments.  

Acurx is planning to change the landscape. Already, Acurx has completed its Phase2a clinical trial with ibezapolstat in patients with CDI, showing a 100% cure rate and 100% sustained clinical cure after 30 days of treatment. That efficacy profile is unmatched and also opens the door to other antibiotic development opportunities created by COVID-19. In fact, policymakers in the US are already intended to bring antibiotics' development back to the forefront, staying ahead of the next health crisis.

Still, while new programs can benefit Acurx in the long run, its current focus on treating CDI is a value driver that can deliver exponential near and long-term value. Keep in mind that although the current standard of care first-line treatment and first recurrence treatment has an initially high cure rate, it leaves a high burden of C. difficile in the gut. Moreover, the detrimental effect on the gut microbiome often leads to recurrence of the condition in up 40% of patients once their therapy stops. Hence, not only is Acurx focused on bringing a better option to market, but it can simultaneously meet an unmet medical need with a potential first-line alternative. 

And that market is substantial.

Targeting Billion-Dollar Markets

In fact, with CDI being one of the most common pathogens in healthcare-associated infections in North America, Acurx is focused on the right product at the right time. The market in dollar terms is already a $1.295 billion opportunity. However, with a more than 10% compounded annual growth rate, expectations are for that market to reach a more than $1.7 billion treatment opportunity by 2026.

Notably, CDI is more than uncomfortable. It also brings a mortality rate of 9.3% and, as noted, has a high level of recurrence. Thus, a better solution is needed. And Acurx is on track to deliver. Its Phase2a study treated patients with mild to moderate CDI with orally administered ibezapolstat given 450mg twice daily for 10 days. Results were phenomenal, with all 10 patients meeting the study's primary and secondary efficacy endpoints of initial cure and sustained cure. Moreover, the drug was well-tolerated, with no severe adverse reactions reported.

In fact, the results were so impressive that, when supported by its compelling evidence of efficacy and safety, regulators allowed for early termination of segment 2a and advancement to a Phase 2b trial. That trial is expected to treat 64 patients over 10 days, with 32 patients dosed ibezapolstat and the remaining 32 patients dosed with Vancomycin, the current standard of care. Obviously, showing up the market leader can have a tremendous impact on the program and, whether they want them or not, could open the door to substantial partnerships and licensing opportunities. Better still, with the treatment lasting only 10 days, investors will hear results relatively soon.

By the way, that program is patent protected through 2032, along with 10 years of regulatory exclusivity from FDA approval. Still, there's more to like in the pipeline.

Seizing Other High-Dollar Market Opportunities

A second program attracting investors is its DNA PolIIIC inhibitor, ACX-375C, targeting Staphylococcus, Streptococcus, and Enterococcal infections. In addition, the drug is positioning to treat other G+ resistant bacterial infections, including VRE and MRSA, both highly debilitating and sometimes fatal infections.

The combined market potential exceeds billions and also taps into the need for substantially better treatment. And with MRSA accounting for more than 52% of the infections in all hospitalized patients, having an effective drug is needed sooner rather than later. Even beyond treating MRSA and VRE, potential clinical indications include urinary tract, hospital-acquired catheter/bloodstream, bone/joint, pneumonia, and ear and sinus infections. Thus, ACX-375C has massive applications and multiple billion-dollar shots on revenue-generating goals.

And like its treatments for the CDI markets, ACX-375C targets unmet medical needs to overcome antibiotic resistance in currently used treatments. Also, this drug and program are protected by two patents covering composition of matter, formulation, and method of use that don't expire until 2039. Better still, the drug is eligible for Qualified Infectious Disease Product (QIDP) and Fast-Track designation.

Best of all, in a head-to-head comparison against Vancomycin, Ibezapolstat showed itself to be a better option. In fact, unlike Vancomycin, ibezapolstat showed no reduction in healthy bacteria, was poorly soluble in the gut (a positive) and had free concentrations of ibezapolstat high enough to kill C. difficile but too low to kill healthy bacteria.

Thus, two programs that bring multiple revenue-generating shots to treat enormous markets make a pre and post-IPO Acurx a compelling investment opportunity.

Set Up For Success

Indeed, the sum of the parts makes Acurx an attractive proposition. And despite most retail traders unable to get IPO shares, they will have an opportunity on the open markets. Thus, keeping this stock in focus today could help position for a potentially enormous back half of the year.

Keep in mind, too, that several catalysts will already be in play. During 2H 2021 and 1H 2022, the company expects to start and complete its ibezapolstat Phase 2b trial targeting CDI. They are also planning to file for QIDP designation for ACX-375C, start its Pre-IND Pharm/Tox studies for ACX-375C, file an IND, and seek fast-Track designation ACX-375C as well.

Thus, Acurx is going to hit the ground running. And with a focus on treating unmet medical needs and potentially bringing a new class of antibiotics to market, Acurx's share price could benefit from retail and institutional interest sooner rather than later.

Better still, with an expected $15 million in the bank following its IPO, the company will be well-funded to advance its trials. Hence, with a low float, cash on hand, and science that can be transformative to an industry, Acurx is undoubtedly in play.

 

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