MTFB.L Share News (MTFB)

(Sharecast News) - Motif Bio said it will need to raise new funds after the application for its skin infections treatment, iclaprim, was refused by the US drug regulator in its present form.A Complete Response Letter from the US Food & Drug Administration said additional data are needed to further evaluate the risk for liver toxicity of iclaprim before the new drug application may be approved. The application was made for iclaprim as a treatment for acute bacterial skin and skin structure infections (ABSSSI).AIM-listed Motif said it plans to request a meeting with the FDA as soon as possible to "discuss potential options to address the deficiencies".Motif is financed into the second quarter of 2019, having cash of $12.3m and $15m of debt drawn from a loan facility as of 31 December 2018, so said it "will need to raise capital in the near term". Chief executive Graham Lumsden said a meeting with the FDA would typically occur within approximately 30-45 days. "We are disappointed for patients and providers seeking an alternative antibiotic to treat ABSSSI."The disappointment also hit Amphion Investments, which is a 9.5% shareholder after last year selling 8.9m shares for $3.65m.Motif shares, which had climbed in recent weeks, crashed to an all-time low 4.69p on Thursday morning, and by mid afternoon were still down more than 70% on the day at just over 11p."We are very surprised at the news given iclaprim's extremely favourable safety/toxicity profile," said 'house' broker Peel Hunt, noting that the profile was established through dosing around 1,300 patients, while the company had also sought FDA advice on trial design as well, in the absence of an advisory committee to provide external advice to the FDA on drug approvals.Analysts said there was "no clear route to approval or commercialisation" and, due to the requirement to raise additional capital, the "rebasing" of the share price was not unexpected.