Summary:
Nabriva is a single-asset company developing a novel pleuromutilin antibiotic, lefamulin (BC-3781), with IV/oral administration and low cross-resistance potential
Lefamulin has shown comparable efficacy and improved tolerability to vancomycin in a Phase 2 trial of Acute Bacterial Skin and Skin Structure Infection (ABSSSI)
Upcoming Phase 3 results for Community Acquired Bacterial Pneumonia (CABP) will likely pass efficacy criteria but have some risk of unexpected adverse events
Despite stronger efficacy against some lung pathogens, lefamulin might not be as broadly effective as other antibiotics in CABP
Overall, Nabriva could provide a much-needed new class of systemic antibiotic, but questions on potency and uncertainty on tolerability increase binary risk
Investment Thesis: Despite some concerns on potency, in our view, there is still a good chance that lefamulin meets the non-inferiority endpoint in the LEAP 1 trial. Given that this will establish the first clinical proof of concept in CABP, we see substantial upside should it be successful. However, should it fail, we would expect equal or greater downside making this a high risk, high reward binary. Overall, with growing concerns on antibacterial resistance, there is a clear need for new antibiotics. If successful, a novel antibiotic like lefamulin should have a place in this evolving marketplace.
Company Overview:
Nabriva Therapeutics (NASDAQ: NBRV) is a single-asset company focused on commercializing...
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