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Recce Pharmaceuticals – working on the global health challenge of sepsis and superbugs

Updated: Jun 15, 2023

In 2020 The World Health Organization (WHO) released its first report on the global epidemiology and burden of sepsis. The report estimated that the life-threatening reaction to infection causes around 11 million deaths annually – around 20% of annual global deaths.

In Europe sepsis accounts for around 3.4 million cases annually and accounts for almost 700,000 deaths.

Sepsis occurs when the body overreacts to an infection, setting off a chain of events that leads to tissue damage and organ failure.

The current and most common method of treatment is with antibiotics through early identification of symptoms and empiric antibiotic therapy to treat the underlying infection.

However globally the underlying pathogens such as bacteria, viruses, parasites, and fungi that antimicrobials are meant to destroy, start adapting in response to them and rendering the treatment ineffective. This is termed Antimicrobial Resistance (AMR) and these drug resistant bacteria are commonly referred to as “superbugs”.

The World Health Organisation lists AMR amongst the top 10 threats to global health. In 2019 around 1.2 million deaths were directly linked to drug-resistant infections globally.

The cost to the global health care system of AMR is staggering is in the billions of dollars each year.

Large Pharmaceutical companies are also beginning to acknowledge the scale of the problem.

In a recent market update Pfizer stated AMR is one of the biggest threats to global health. Pfizer Medical Director, West Africa, Dr. Kodjo Soroh said in early 2023 “without action by governments, industry and society, AMR is expected to cause 10 million deaths each year by 2050. Overuse by antibiotics is creating stronger germs. Some bacteria are already resistant to common antibiotics. Losing the ability to treat serious bacterial infections is a major threat to public health”.

An Australian based pharmaceutical / biotech company has developed a novel and potentially highly lucrative solution for AMR. Recce Pharmaceuticals Ltd (ASX: RCE; FSE: R9Q) is developing a novel class of broad spectrum synthetic anti-infective drugs with a global significant market potential.

The lead drug developed by Recce Pharmaceuticals is Recce 327 – a synthetic polymer antibiotic. The likely indications will be sepsis, urinary tract infections (UTIs), burn wound infections, superbugs, gram-positive and gram-negative bacteria.

Recce 327 has a novel, multifaceted mechanism of action (MoA) allowing it to show sustained effectiveness against a wide range of bacteria and viruses in preclinical models with no evidence of bacterial resistance received to date.

Recce 327 has been added to the Pew Charitable Trusts annual list of non-traditional products in development to combat bacterial infections identifying new antibiotic treatments in development worldwide.

The company has already completed a Phase I single ascending does study in Australia for IV formulation for Recce 327 resulting in favourable safety in dosing up to 6,000mg.

Toxicology trials conducted to date have shown no stimulation of the immune response which is critical in sepsis treatment.

In addition, the Company is also progressing the following clinical trials:

  • Phase I/II Urinary Tract Infections including Urosepsis (data readouts in 2024)

  • Phase I/II Wound infection including infected burns and conducted in conjunction with the Fiona Stanley Hospital (data readouts in late 2023)

  • Phase I/II Diabetic Foot Ulcers (data readouts in late 2023)

  • Phase I serious/life threatening bacterial infections including sepsis

The data readouts from these trials will be eagerly awaited and will provide significant key value infection points for the company.

Recce Pharmaceuticals also has an oral polymer formulation in preclinical development called R435. In addition, Recce 327, and a newer formulation R529 are being assessed as anti-viral treatments in preclinical / research stages for treating COVID-19 and influenzas.

The company is in a leading position to provide effective new classes of antibiotics for these global challenges, due to the shortage of any new antibiotics discovered or patented in the last 40 years. Most new antibiotic approvals have just been new molecules falling within existing drug classes.

In a 2023 research note published by Edison (P. Heyami CFA, March 2023) the author noted “Recce 327 appears to show the properties needed for having a solid chance of being the best ‘one-size-fits-all’ antimicrobial for sepsis given its properties of not having shown resistance to date, demonstrated broad antimicrobial activity, and being robustly bactericidal”.

Edison provided a valuation of Recce Pharmaceuticals at A$2.79 (€1.69 a share) based on projected sales of Recce 327 to treat sepsis in the United States and Europe in 2032 of over US$2 billion.

The merger, acquisition and collaboration activity within the antibiotic and anti-infective sector is increasing providing some valuation comparisons in the sector.

In 2022, GSK and Spero Therapeutics announced an exclusive licence agreement for tebipenem Hbr (TH) – a late-stage antibiotic that may be used to treat complicated urinary tract infection. This deal included a US$66 million up front payment, exclusive licence for GSK to commercialise TH in all regions other than Japan and certain Asian countries and GSK purchasing US$9 million worth of shares in Spero. TH is the first commercial carbapenem antibiotic to potentially treat complicated urinary tract infections caused by certain bacteria.

The M&A activity in the anti-infective sector is also strong, evidenced by the following deals.

Novartis (ISIN CH0012005267) acquired GSK’s cephalosporin antibiotics business with a deal worth potentially US$500 million.

Roche Holding licenced an antibiotic from Forge Therapeutics to treat lung infections attributable to gram-negative bacteria.

The global antibiotics market was US$38 billion in 2021 and this is expected to increase to US$45 billion in 2028.

Professor Lothar Wieler, the President of Germany’s Robert Koch Institute said recently about the threat of antimicrobial resistance, “the medicines that we have come to rely on in our modern world are under threat”. He described a world where infections that used to be largely curable such as tuberculosis, blood infections and pneumonia again turning into deadly diseases.

The rewards – both financially and socially – for companies such as Recce Pharmaceuticals that can identify, patent, and commercialise new classes of anti-infective not susceptible to developing resistance against them, will be immense.


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