MTFB.L Regulatory News (MTFB)

2 April 2015

Motif Bio plc

("Motif", the "Company" or with its subsidiary the "Group")

First Day of Dealings

Clinical stage biopharmaceutical company developing new antibiotics admitted to AIM

Motif Bio plc, a clinical stage biopharmaceutical company specialising in the development of antibiotics, is pleased to announce that admission and trading of its Ordinary Shares commences today on AIM with the ticker MTFB.

KEY POINTS:

· The Company has a lead antibiotic candidate, iclaprim, in clinical development. The directors anticipate that iclaprim could be ready for commercialisation within approximately 36 months.

· The Company is seeking to confirm in meetings with the FDA and EMA in the first half of 2015, that the clinical development plan for iclaprim meets regulatory guidelines and that two Phase III trials can be conducted. A Type C meeting is scheduled with the FDA for 14 April 2015. 

· Resistance to antibiotics is a major global public health threat. The world's pipeline of novel antibiotics has not kept pace with the ability of certain bacteria to resist treatment with existing products. The Group has a clinical stage antibiotic, iclaprim, which has been designed to be effective against multi-drug resistant bacteria.

· On Admission the Company will have 64,238,442 Ordinary Shares in issue and a market capitalisation of approximately £12.8 million. The Company will have raised £2.8 million (before expenses) by the issue of 12,490,000 Placing Shares at the Placing Price, and 1,696,140 Subscription Shares at the Subscription Price.

· The net proceeds of the Placing and Subscription will be used to complete preparations to enter Phase III trials with iclaprim and to provide working capital.

· The Company comprises an Executive Management Team, Non-Executive Directors, a Scientific Advisory Board and a team of scientific consultants covering all of the required drug development intellectual property and regulatory disciplines needed to successfully pursue the Group's drug development programmes.

Graham Lumsden, CEO of Motif, commented:

"I am delighted that we have today successfully listed Motif as planned. Our overriding objectives in becoming a public company have been to close the merger transaction with Nuprim, granting Motif exclusive worldwide rights to develop and commercialise iclaprim, and to raise sufficient funds to complete preparations to enter Phase III trials with iclaprim. I am pleased to confirm that we have achieved both objectives.

"We are also pleased to announce that a meeting with the FDA has been scheduled for 14 April 2015 to discuss the phase III programme for iclaprim.

 "With a new antibiotic at this stage of readiness, Motif is well placed to benefit from the looming public health crisis by developing novel antibiotics designed to be effective against multi-drug resistant bacteria. We are looking forward to keeping our new shareholders and other investors updated with progress as we take iclaprim through the various stages of testing and approvals and onward to commercial success."

Unless the context otherwise requires, defined terms shall have the meaning ascribed to them in the Admission Document available on the Group's website: www.motifbio.com

Enquiries:

KEY STATISTICS

\* This number assumes all share issues triggered by Admission other than the Placing and Subscription will have taken place prior to Admission.

**On the basis that all Options, Warrants and CPNs in existence on Admission have been exercised

Introduction

The Company is a clinical stage biopharmaceutical company which specialises in developing novel antibiotics designed to be effective against serious and life-threatening infections caused by multi-drug resistant bacteria. The Company will, on Admission, have a lead antibiotic candidate, iclaprim, in clinical development and MTF-001, a preclinical stage programme, to design a best-in-class DHFRi. Discussions and negotiations with academic institutions and pharmaceutical companies are under way to build a portfolio of antibiotic candidates through licensing. The Group's main area of operation is the US.

The Company is seeking to confirm in meetings with the FDA and EMA in the first half of 2015, that the clinical development plan for iclaprim meets regulatory guidelines and that two Phase III trials can be conducted. A Type C meeting has been scheduled with the FDA for 14 April 2015. Upon confirmation of the clinical development plan and subject to funding being available, the two Phase III trials are planned to be initiated in the second half of 2015.

Subject to funding being available, the Directors anticipate that iclaprim could be ready for commercialisation within approximately 36 months.

The Company has built a team of scientists and experts with extensive drug development experience and is raising approximately £2.1 million net of expenses through the Placing and Subscription to provide the Group with capital to complete preparations to commence Phase III trials with iclaprim and to provide the Group with additional working capital. Additional funding will be needed to carry out the two Phase III clinical trials on iclaprim and to progress the Group's other drug development programmes.

Group Structure and History

Originally founded as a population genetics company, Motif, Inc. has, since 2009, focused on drug discovery and development. A team of expert scientists was assembled in 2009/2010 with the goal of identifying first-in-class pharmaceutical compounds with significant flaws or deficits that could be fixed using tractable synthetic chemistry. Medicinal chemistry plans and research operating plans were completed for three development programmes - an antibiotic, a product to treat rheumatoid arthritis and a drug for overactive bladder. In each case, a strategy to develop a best-in-class compound was mapped out with the aim of identifying patentable lead compounds within approximately 18 months. On 13 June 2012, a collaboration agreement was executed with Jubilant, pursuant to which Jubilant provides laboratory facilities and personnel to Motif, Inc. to assist in developing one of the three best-in-class compounds (MTF-001): a DHFRi designed to be effective against MRSA and multi-drug resistant bacteria. In late 2013, it was decided that Motif, Inc. should focus exclusively on antibiotics.

In December 2014 Motif, Inc. began its evolution from a preclinical stage company to a late stage clinical company by entering into the Nuprim Merger Agreement. Pursuant to the Nuprim Merger Agreement, Motif, Inc. conditionally agreed to merge with Nuprim, a Maryland corporation owning the exclusive worldwide rights to a potential novel antibiotic called iclaprim, into Motif, Inc. The completion of this merger is subject to Admission. Iclaprim completed clinical development and in 2008 a NDA and a MAA were submitted seeking approval to market in the US and EU, respectively. In 2009 the FDA declined to approve iclaprim based on the data submitted and subsequently the MAA was withdrawn in Europe. The scientific experts at Motif, Inc. have reviewed the data package for iclaprim and have concluded that by addressing certain def iciencies in the original development programme, iclaprim can be returned to clinical development and re-submitted for review by the FDA and by the EMA. Providing funding is available to complete the Phase III trials and regulatory approval is granted, the Directors anticipate that iclaprim could be marketed within approximately 36 months.

Business and Investment Opportunity

The net proceeds of the Placing and Subscription will be used to complete preparations to enter Phase III trials with iclaprim and to provide working capital. An additional fundraising or a strategic partnership with another pharmaceutical company is planned for later in 2015 in order to raise additional capital and fund the Phase III trials with iclaprim.

Resistance to antibiotics is a major global public health threat. The world's pipeline of novel antibiotics has not kept pace with the ability of certain bacteria to resist treatment with existing products. The Group has a clinical stage antibiotic, iclaprim, which has been designed to be effective against multi-drug resistant bacteria.

Iclaprim is being designed to be administered in hospitals as an intravenous infusion. The Directors believe the most urgent need for novel antibiotics effective against multi-drug resistant bacteria is in the hospital setting where patients often succumb to serious, life-threatening infections that require immediate treatment with the best available antibiotic. In the case of HABP, mortality rates for infected patients are currently between 20 per cent. and 50 per cent. Extended hospital stays pose a burden to healthcare systems and can increase hospital costs by an average of approximately £26,000 per patient. In the Directors' experience, commercialisation of hospital products is relatively easy and can be done with fewer resources than commercialisation in the community because there are fewer hospital healthcare professionals to communicate with, compared to launching and educating the larger number of primary care and general practitioners in most countries.

Assuming that Motif, Inc. receives regulatory approval to start Phase III testing in the second half of 2015, the Directors believe that iclaprim offers a rapid path to commercialisation, which could be expected to occur in 2018 subject to funding or a strategic partnership with a pharmaceutical company. A follow-on pipeline of preclinical antibiotics is being built to follow iclaprim as additional funding becomes available. Should the FDA approval be delayed or rejected, the Directors would consider alternative plans to progress iclaprim and would also focus on progressing the Company's other pre-clinical drug programmes.

Recent mergers and acquisitions demonstrate the increased activity within the antibiotic field. Paratek listed on Nasdaq in 2014, raising approximately US$100 million to develop a tetracycline antibiotic called omadacycline, whose Phase III studies are set to re-start in the first half of 2015. Paratek's market cap increased to approximately US$574 million following the acquisition in January 2015 of Cubist by Merck & Co., Inc. for US$9.5 billion. Durata Therapeutics Inc. (NASDAQ: DRTX) was acquired by Actavis (NYSE: ACT) in October 2014 for US$675 million plus contingent value rights, following the approval for its first antibiotic in May 2014.

The Directors believe, assuming that iclaprim successfully completes Phase III trials, that the Company should be an attractive candidate for a strategic partnership with a large pharmaceutical company with commercialisation expertise and capabilities.

Scientific and Market Background

Resistance to antibiotics is a major global health threat. So-called "superbugs" are developing resistance to currently available antibiotics faster than new, effective antibiotics are being developed. In June 2013, Dr Margaret Chan, Director-General of the World Health Organisation stated that, "a post-antibiotic era means, in effect, an end to modern medicine as we know it. Things as common as strep throat or a child's scratched knee could once again kill. Some sophisticated interventions, like hip replacements, organ transplants, cancer chemotherapy, and care of preterm infants, would become far more difficult or even too dangerous to undertake."

The worldwide antibacterial market was valued at US$43.9 billion in 2010. There are many antibiotics in the market today and two have annual sales of more than US$1 billion, Zyvox (linezolid, Pfizer) and Cubicin (daptomycin, Merck & Co.). Since iclaprim was designed to be effective against bacteria resistant to trimethoprim, the only other commonly used antibiotic with the same mechanism, iclaprim should be well positioned to compete in this commercially attractive market. The GAIN Act, which was signed into law on 9 July 2012, mandates faster review times at the FDA and grants new antibiotics an additional 5 years on top of the 5 years of "Hatch-Waxman" exclusivity giving a total of 10 years of market exclusivity from the date of approval in the US.

Product Portfolio

The Group is committed to helping resolve the looming public health crisis by developing novel antibiotics designed to be effective against multi-drug resistant bacteria. The initial focus of the Group's team is on the development of iclaprim.

Information on iclaprim

Iclaprim is a potential novel antibiotic, designed to be effective against bacteria that have developed resistance to other antibiotics, including trimethoprim, the only other commonly used antibiotic that shares the same mechanism. Iclaprim is bactericidal and has a low risk for resistance development. Originally discovered by F. Hoffman-La Roche Ltd, iclaprim is a DHFRi. Iclaprim was licensed to and developed by Arpida AG ("Arpida") and in 2008, a request to the FDA and the EMA was submitted for approval to market the compound. On the basis of the submitted data, iclaprim was not approved and ceased to be developed.

The Group has completed due diligence, including a review of the preclinical and clinical data plus the US and European regulatory correspondence, and the Directors believe that iclaprim can be rapidly returned to late stage clinical testing with some improvements to the original development programme. The final clinical development plan will be confirmed in meetings with the FDA and the EMA, which are expected to take place within 6 months of Admission. The Group has a copy of the "Complete Response Letter" received by Arpida in January 2009 which confirms the reasons that iclaprim was not approved by the FDA based on the data submitted in 2008. This confidential information, together with the improved regulatory environment and the need for novel antibiotics that are effective against multi-drug resistant bacteria, support the Group's plan for a rapid return to clinical development for iclaprim.

Assuming that funds can be raised (or a partnership be entered into) to carry out clinical development and that the clinical trials are successful, the Directors believe that it is feasible to achieve approval to market within 36 months.

Regulatory background

Iclaprim completed clinical development and marketing applications to the FDA and the EMA were submitted in 2008. At that time and based on the data submitted, iclaprim failed to gain approval from the FDA or the EMA. Three other new antibiotics also failed to gain approval for commercialisation around this time: dalbavancin, oritavancin and omadacycline. Additional clinical trials were completed with dalbavancin and oritavancin and they were both approved by the FDA in May and August 2014 respectively. Omadacycline is expected to re-enter the Phase III trials in the first half of 2015.

In 2007, telithromycin (Ketek) was approved as a novel antibiotic, and then associated with severe liver injury and fraudulent safety data which resulted in two of three Ketek indications being withdrawn and the Directors believed this led to a slowdown in new drug approvals. In recent years, the Directors believe that the regulatory environment for antibiotics has become more favourable to the approval of potential antibiotic compounds. The urgent need for novel antibiotics is well recognised, with the passing in 2012 of the GAIN Act, which mandates accelerated approval times and extended market exclusivity in the US, and the publication by the FDA of revised, clear clinical trial guidelines. The Directors believe this development is a major improvement compared to the situation at the time of the earlier antibiotic submissions in 2008 and that this greatly enhances the likelihood of approval, assuming that the clinical trials are completed successfully.

Next steps

Iclaprim: Motif, Inc. has developed a clinical and regulatory strategy which the Directors believe addresses the def iciencies in the original development programme, with the intention of re-entering clinical testing with an i/v formulation for use in hospitals. The Company is seeking to confirm in meetings with the FDA and the EMA in the first half of 2015 that the clinical development plan for iclaprim meets regulatory guidelines and that two Phase III trials can be conducted as proposed. A Type C meeting has been scheduled with the FDA for the 14 April 2015. Similar discussions are planned to take place with the EMA in the first half of 2015.

The two initially proposed indications are:

· ABSSSI, a common serious infectious disease involving multi-drug resistant bacteria. Within the US hospitalised patients, skin and soft tissue infections were estimated to have increased by 176 per cent. from 1997 to 2009. The two Phase III trials with iclaprim, completed in 2008, demonstrated efficacy and safety in patients with cSSSI; and

· HABP, a serious infection with a mortality rate between 20 per cent. and 50 per cent. and can lead to an increase hospital costs by an average of approximately £26,000 per patient. Iclaprim's Phase II trial demonstrated excellent efficacy in patients with HABP and iclaprim was more effective and led to fewer drug-related adverse events than those treated with vancomycin.

The two trial protocols have been developed to be consistent with the latest published FDA and EMA guidelines.

Upon confirmation of the clinical development plan, the first of the two Phase III trials is planned to be initiated in the second half of 2015. The existing API is being re-qualified to ensure adherence to current global regulations for characterisation of compounds for clinical use. Assuming that this existing material can be used to manufacture clinical trial supplies, the Phase III programme will be ready to start before the end of 2015. Once the clinical development plan is finalised following the FDA and EMA meetings, including the number of patients required to be included, and negotiations with CROs have been completed, the final clinical costs will be confirmed.

The Company is intending to seek to raise additional capital or enter into a strategic partnership with another pharmaceutical company in order to fund the Phase III trials. Several development programmes and indications will be undertaken with the iclaprim assets and the Directors' ambition is to have other new indications, formulations and combinations in clinical development by the end of 2016.

Reasons for Placing, Subscription and Admission

The net proceeds of the Placing and Subscription will assist the Group in its development by providing funding to advance iclaprim to be ready to re-enter Phase III trials and to provide working capital. The two Phase III clinical trials for iclaprim (as described above, in this Part I) will be funded following Admission and possibly through a strategic partnership with another pharmaceutical company.

The Directors believe that Admission will assist the Group in its development by:

· enabling the Group to complete development work prior to initiation of the first Phase III trial with iclaprim, subject to regulatory approval;

· raising its profile in the sector in which it operates;

· increasing access to capital required to fund further product development and clinical trials; and

· providing a market on which the Ordinary Shares can be traded, which will give increased liquidity and potentially a market valuation for the Company's equity which, in conjunction with the employee option schemes, will assist the Group in attracting, retaining and incentivising high calibre employees.

Details of the Placing and Subscription

On Admission the Company will have 64,238,442 Ordinary Shares in issue and a market capitalisation of approximately £12.8 million. The Company will have raised £2.8 million (before expenses) by the issue of 12,490,000 Placing Shares at the Placing Price, and 1,696,140 Subscription Shares at the Subscription Price.

Directors and Key Management

The Company's Board is comprised as follows. Further details on the Directors are set out in the Admission Document.

Richard Cecil Eversfield Morgan, Non-Executive Chairman (aged 70)

Richard Morgan is Chairman of the Company and is also Chief Executive Officer of Amphion. Amphion is the successor firm to VennWorks LLC and Amphion Capital Partners LLC, which Mr Morgan also co-founded. Over the course of his career, Mr Morgan has been directly involved in the start-up and development of more than 30 companies in the information technology, healthcare and biotechnology industries. These include MediSense, Sequus Pharmaceuticals, Celgene, Quidel and Vortech Data. Prior to this Mr Morgan spent 15 years with Schroders plc as a board member and head of the Schroders Strategy Group, which he founded. Mr Morgan was a co-founder of Celgene Corporation, and held a board position with the company from 1987 to 2008. Mr Morgan currently serves as Chairman of four other Amphion Partner Companies (Axcess, FireStar, Private Markets and WellGen) and is also a director of DataTern.

Graham George Lumsden, Chief Executive Officer (aged 55)

Graham Lumsden, Chief Executive Officer of the Company, is responsible for all aspects of the strategy, management, and operations of the Company. Prior to joining the Company, Mr Lumsden was a senior executive at Merck & Co., Inc. where he held commercial leadership positions in multi-billion dollar worldwide businesses. Mr Lumsden has a proven record of success leading change and delivering results in subsidiary and global leadership positions, including new product launches, pre-clinical and clinical development, regulatory strategy, IP strategy and litigation, and strategic sales and marketing. Mr Lumsden is a member of the Royal College of Veterinary Surgeons (MRCVS), holds a postgraduate diploma from the Chartered Institute of Marketing (MCIM) and is a dual citizen of the UK and US.

Robert ("Bob") Joseph Bertoldi, Chief Financial Officer (aged 60)

Bob Bertoldi is Chief Financial Officer of the Company. He is also Chief Financial Officer of Amphion and was a founder President and continues to be the Chief Financial Officer of Amphion Capital Partners LLC (the predecessor of Amphion) and VennWorks LLC. Mr Bertoldi is also a general partner of Amphion Partners LLC (formerly known as Wolfensohn Partners, LP). Prior to that, Mr Bertoldi served as Chief Financial Officer for James D. Wolfensohn, Inc. and Hambro America Inc. Mr Bertoldi currently serves as a director of three other Amphion Partner Companies, m2m, WellGen and Axcess and is also a director of DataTern. Mr Bertoldi began his career at KPMG and left as a manager in the investment services department. Mr Bertoldi obtained a B.A. in Accounting and Economics from Queens College, New York in 1976 and became a Certified Public Accountant in 1978. He is a member of the AICPA and NYSCPA.

· Bruce Andrew Williams, Non-Executive Director (aged 60)

· Dr Mary Lake Polan, Non-Executive Director (aged 71)

· Dr John Wilbur Stakes III, Non-Executive Director (aged 65)

· Zaki Hosny, Non-Executive Director (aged 66)

· Charlotta Ginman-Jones, Non-Executive Director (aged 49)

· Jonathan Gold, Non-Executive Director (aged 42)

· Dr David Huang, Chief Medical Officer (aged 40)

Scientific Advisory Board

The Scientific Advisory Board consists, at the time of Admission, of four qualified experts, three of whom are experienced anti-infective clinicians. The Scientific Advisory Board provides independent expert advice and guidance to the Company.