Cempra reported a wider loss in the first quarter as the Chapel Hill drug developer ramps up commercialization activities for a pneumonia drug that company executives expect to have approved in time for the upcoming winter flu season.
Executives said Monday that they expect approval from the U.S. Food and Drug Administration late this year and hope to introduce the drug, solithromycin, in January. In order to sell the antibiotic at the peak of the flu season, the company is hiring sales directors and laying the groundwork for hiring a sales team of 200 to 300 representatives to flood the nation’s hospitals.
“We are now in full launch readiness mode,” Cempra’s chief commercial officer, David Moore, told analysts on a conference call..
“Some of our key focus areas that are going on right now are final pricing, research among our managed care and hospital customers, promotional message testing, and building an extensive medical education plan for the launch,” Moore said.
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Cempra on Monday announced it filed a “new drug application” with the FDA for the company’s treatment for community-acquired bacterial pneumonia, or CABP. The infection is a major cause of death, particularly among the elderly.
Solithromycin is being developed for patients who are so ill they require antibiotic injections because they are too weak to swallow pills. The company is also seeking FDA approval of tablet versions for patients who are recovering from pneumonia infections.
The company is pricing the drug in such a way as to convince hospital administrators that they can discharge pneumonia patients earlier.
“Hospitals will realize people can go home sicker and they will be able to save a lot more money on our drugs,” CEO Prabhavathi Fernandes told analysts.
The 10-year-old company has been developing the pneumonia treatment for the past decade. Cempra has 110 employees, up from 80 just several months ago.
Cempra said Monday its first-quarter revenue fell to $2.7 million from $14 million in the same three-month period a year ago. It reported a net loss of $29.4 million in the quarter, up $17.4 million during the same period last year.
Executives said they had $223.6 million in cash as of March 31, enough to finance operations into the second quarter of 2017. Cempra’s recurring revenue comes from federal research funding and licensing agreements. In January the company raised $94 million through a public offering of 4.17 million shares at $24 per share.
Cempra shares rose 46 cents Monday to close at $17.39. The stock is down 44 percent over the past year.
According to Cempra, solithromycin would alleviate the problem of antibiotic resistance, which is approaching 50 percent in some areas and forcing doctors to use antibiotics whose side effects can include Achilles tendon rupture, aortic aneurism and retinal detachment.
“We expect a review ... in the November time frame and approval before Christmas,” Fernandes said.