Bankrupt antibiotics maker Aradigm turns to old partner/investor for final $3M fire sale
Grifols once paid Aradigm $26 million for a stake in its inhaled antibiotics. But with Aradigm now in bankruptcy, the Spanish drugmaker is dishing out a final $3.2 million to buy it all.
The fire sale — which comes one year after Aradigm filed for Chapter 11 following a regulatory trifecta for disaster — will see Grifols obtain assets and IP to Apulmiq (formerly Pulmaquin and Linhaliq in Europe), Lipoquin and free ciprofloxacin. In addition to waiving its claims in the bankruptcy case, Grifols also agreed to milestone payments up to $3 million more upon any regulatory approvals.
But they will have quite a few hurdles to overcome. Regulatory agencies and outside experts alike made their skepticism toward Aradigm’s data clear. The FDA slapped down an application for Apulmiq and requested a new Phase III trial back in 2017, and the company withdrew its submission in Europe after the EMA indicated it was going to do the same.
Aradigm’s idea had been to fight lung infections with inhaled formulations of ciprofloxacin. Available as pills, eye drops, ear drops and by IV, the antibiotic was already deployed against a wide range of conditions such as joint infections, intra-abdominal infections, infectious diarrhea, respiratory tract infections, skin infections, typhoid fever and urinary tract infections.
The Newark, CA-based company turned to antibiotics after an effort, partnered with Novo Nordisk, to develop an inhalable form of insulin flailed.
Yet their Phase III studies for Apulmiq in non-cystic fibrosis bronchiectasis yielded mixed data, as the drug only hit the primary endpoint — lengthening the median time to first pulmonary exacerbation — in one trial but not the other.
Grifols did not elaborate on what it now plans to do with the assets. It would likely involve a two-year trial that the FDA asked for but Aradigm didn’t have the money to fund.
“Excluded from the sale are all of the Company’s cash and cash equivalents, accounts or notes receivable, certain contracts, tangible personal property, the name Aradigm Corporation, accounts and records of Aradigm Corporation, all benefit plans and the shares of Aradigm,” a statement noted.
Aradigm was one of three antibiotics players to declare bankruptcy last year. In a market where even companies that come up with successful products can’t survive the commercial crunch, investors seem to have even less patience for the failed ones.
