Going through a phage

RICHMOND, Va.—AmpliPhi Biosciences Corp. will attempt tobreathe life into an almost forgotten, 95-year-old therapeutic area byacquiring Sydney-based Special Phage Services (SPS). The combination of the twocompanies would result in the creation of the leading—and maybe theonly—anti-infective company focused on developing phage-based therapies tocombat the growing threat of antibiotic-resistant infection.

Bacteriophage therapeutics have been widely used in theformer Soviet Union and to a lesser extent in France, where Félix d'Hérelle iscredited with discovering their potential in 1917 while at the PasteurInstitute. Later, Dr. George Eliava founded the eponymous Eliava Institute inTbilisi in what is now Georgia (the country).

According to Phil Young, AmpliPhi president and CEO,bacteriophages became the principal way to treat bacterial infections and wereproduced by metric tons as primary antibiotics. They also were used during the1920s and 1930s in the United States and Europe, but were abandoned due to thelack of well-controlled studies and the advent of antibiotics that were easierto make, store and prescribe. Thus, several decades passed before the firstclinical trial in Western Europe in 2009 demonstrated the safety and efficacyof phage therapy of Pseudomonas aeruginosafor ear infections.

Young stresses that "the combination of AmpliPhi with SPSwould result in the creation of the first global phage therapy company coveringthe United States, Europe and the Asia-Pacific regions. AmpliPhi and SPS havecomplementary technologies and pipelines backed by a truly stellar team ofinternationally recognized phage scientists. The combined companies wouldpossess an unmatched pipeline of innovative developmental phage therapies. Ourinitial post-acquisition focus is expected to be the treatment of bacterial infectionsthat are resistant to conventional antibiotics. Initial targets include: globalpandemic strains of Pseudomonas aeruginosa,methicillin resistant Staphylococcus aureus (MRSA), E. coli, Klebsiella and otherhospital-related 'super bugs.' Although some doubt that there is a clearregulatory path to FDA approval, we're confident that is not the case. We'relooking for a broad-spectrum phage as our platform technology; then it will be'plug and play.'"

AmpliPhi BioSciences was created in 2011 through the mergerof Biocontrol Ltd. with Targeted Genetics Inc., which had been active in thefield since 2004. AmpliPhi claims to be the first company to present evidenceof the clinical efficacy of phage therapy in a well-controlled and regulatedhuman clinical trial. Its leading therapeutic programs target areas ofsignificant unmet need—typically, gram-negative bacterial infections that areoften resistant to existing antibiotic treatments. These include BioPhage-PAfor the treatment of chronic and acute lung infections in cystic fibrosis, andventilator associated pneumonia (VAP) for patients with deep-seated,difficult-to-treat infections, Young notes.

In addition to its pipeline of phage products aimed at themajor hospital-related superbugs—the so-called ESKAPE organisms: E.coli, Staph, Klebsiella, Acinetobacter,Pseudomonas and Enterobacter—the SPS grouphas also developed phage-based treatments in the veterinary health area. Thecompany has provided evidence of the value of phage-based treatments for infertilityin thoroughbred horses affected by resistant bacterial infection, havingeffected cures in more than 20 mares and stallions. Assuming the acquisition iscompleted, the new combined company is expected to seek to develop and partnermany applications in treating and curing infections in animals.

Completion of the share exchange acquisition of SPS byAmpliPhi is subject to standard conditions, including, without limitation,acceptance of AmpliPhi offer by a sufficient number of SPH shareholders, completionof regulatory approvals and execution of certain ancillary agreements.