Matinas BioPharma Holdings Inc (MTNB) Can Take A $350M Antifungal Market From Gilead Sciences, Inc. (GILD)

In most cases a new method of drug delivery can occasionally alter markets a bit and cause some shifts. In rare cases though, it can fundamentally change an entire sector. The case of Gilead Sciences, Inc. (NASDAQ:GILD) and Matinas BioPharma Holdings Inc (OTCMKTS:MTNB) around a niche antifungal drug called amphotericin B may just be that rare case. Here’s why.

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Life-threatening candidiasis fungal infections are not usually encountered by healthy people, but among leukemia patients for example, who have just had their immune systems zapped for a bone marrow transplant, they are a serious issue. Then why not take a simple prophylactic antifungal and solve the problem? The answer is that the most effective candidiasis antifungal is extremely toxic. Amphotericin B is an absolute last resort. Taking it as a prophylactic would be just as dangerous as a life-threatening systemic candida infection.

Gilead sells a version of the drug called AmBisome, the name a melding of amphotericin b liposome, which suspends the active drug in an inert compound with the goal of shielding the body from its devastating side effects in a last-resort scenario. AmBisome sells approximately $350 million a year, and it’s still a last-resort drug, never used as a prophylactic for leukemia patients against candidiasis.

From Gilead Sciences, Inc. (NASDAQ:GILD), we know two things. First, amphotericin B works (though admittedly we don’t need Gilead for that) and two, that reformulations of the antifungal also work, and they sell.

Back in late-September, Matinas began dosing patients in a Phase IIa trial for its own version of amphotericin B. Matinas’ version is called, for now, MAT2203, or encochleated amphotericin B. The active drug is packaged in tiny envelopes called cochleates, which unfurl and release the drug only when the envelopes are engulfed by white blood cells. The white blood cells then move on to attack the infection, armed with the drug inside them already, and all this without the drug being exposed to the blood stream.

Market Exclusive had the opportunity to speak with Matinas about the trial and its progress, and what we found particularly unique was the public display of confidence in this mid-stage trial, something that is quite rare among small companies like Matinas that typically cannot afford to overinflate investor hopes. Overt optimism often invites too much speculation, something that can lead to high and undesired volatility, especially in a small-cap stock like this.

And yet, in its press release on the beginning of dosing for this trial, Matinas says the following (emphasis added):

“BASED ON THE FAVORABLE RESULTS OF THE MAT2203 PHASE 1 STUDY AND EXTENSIVE PRECLINICAL DATA, WE ANTICIPATE THAT THIS STUDY WILL DEMONSTRATE THE EFFICACY OF MAT2203 ALONG WITH IMPROVED TOLERABILITY. WE LOOK FORWARD TO REPORTING TOPLINE RESULTS IN THE FIRST HALF OF 2017.”