Basilea seeks antibiotic partners after European backing

Reuters

* Basilea wins European backing for superbug antibiotic

* Company in talks to partner ceftobiprole

* Shares surge 10.8 percent pre-market

* In talks over U.S. backing

ZURICH, Oct 23 (Reuters) - Swiss biotech group Basilea said it is in talks with potential partners for itssuperbug antibiotic ceftobiprole, after the treatment wonbacking from the European regulator to treat hospital andcommunity-acquired pneumonia.

"We are actively discussing with potential partners, nowthat the regulatory risk is gone and the drug can be sold inEurope with some additional phases like national licensing,"Basilea's chief executive officer Ronald Scott told journalistson a call on Wednesday.

Earlier, the Basel-based firm said ceftobiprole was giventhe green light by European regulators to treat MRSA, themethicillin-resistant Staphylococcus aureus which is estimatedto kill some 20,000 people every year in the United States.

CEO Scott said Basilea is looking to exceed the 200 millionSwiss francs ($223.40 million) in annual revenue of similarantibiotics with a narrower treatment range, but did notelaborate.

Bank J. Safra Sarasin estimates the antibiotic couldgenerate peak sales of 500 million francs as a treatment for hospital- and community-acquired pneumonia.

Basilea's shares surged in pre-market indications followingthe news, which follows several stumbling blocks for theantibiotic, including Basilea's falling out with originalpartner Johnson & Johnson (J&J).

At 0621 GMT, the stock was indicated 10.8 percent higher at91 Swiss francs. Trading in Zurich resumes at 0700 GMT.

The emergence of hospital superbugs such as MRSA hasincreased the need for new effective treatments and refocusedattention on antibiotics.

After J&J decided not to back the drug and expressed doubtsabout the reliability of trial results, a Dutch arbitrationtribunal in 2010 ordered the U.S. drugmaker to pay Basilea about$130 million for lost milestone payments and damages.

Basilea is still struggling with U.S. backing for the drug,and said on Wednesday that ongoing talks with the U.S. Food andDrug Administration centre on being able to submit theantibiotic without costly additional trials.

Basilea expects the antibiotic to reach the European marketin three to five months, after it is licensed nationally and hasclinched pricing approval, which is done country-by-country.

The superbug antibiotic's backing eclipses progress Basileamade on another drug, isavuconazole, earlier this year. Theantifungal treatment won "orphan" drug status in the UnitedStates, which analysts estimate could be worth up to 150 millionfrancs annually if it reaches the market.

Basilea has gone through a series of shake-ups this year,including the departure of its chief financial officer just twomonths after that of the firm's founder and chief executive.

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