Israel's Atox banks $23M to fight flesh-eating bacteria

Israeli drug developer Atox Bio has raised a $23 million E round to support its treatment for rare, tissue-destroying bacteria, paving the way for late-stage work.

Atox's lead candidate is a peptide targeting necrotizing soft-tissue infections (NSTI), or flesh-eating bacteria, spurring an immune system response by binding to CD28, a protein expressed on T cells. The drug, AB103, came through in a 40-patient Phase II study, according to Atox, improving NSTI patients' organ function and reducing their time in intensive care and need for surgical procedures.

Now, thanks to an investor syndicate including GlaxoSmithKline's ($GSK) SR One, Lundbeckfond Ventures and OrbiMed, Atox is gearing up for a Phase III trial, expecting to start enrollment in the second half of 2015, the company said.

Atox CEO Dan Teleman

"This investment reflects our investors' confidence in the company and validates our novel approach to treating severe infections," CEO Dan Teleman said in a statement. "With this investment, we plan to advance AB103's clinical development and further expand into new therapeutic categories."

There are currently no approved treatments for NSTI, which afflicts about 21,000 people a year in the U.S., according to Atox. The current standard of care involves a painful series of surgical procedures to remove dead tissue, often requiring patients to hook up to ventilators and take a host of antibiotics.

Atox's drug, based on work from Hebrew University, secured both the FDA's fast-track designation and orphan drug status, promising an accelerated review if and when the company makes its way through late-stage study.

Beyond NSTI, Atox believes AB103 has the potential to treat severe intra-abdominal infection, a common cause for hospitalization that affects about 150,000 people a year and can lead to death.

- read the statement