Cocrystal Pharma, a Seattle-area company co-founded by a Nobel Prize winner and backed by biotech veterans, is taking aim at high-profile viruses.
The publicly traded company has the green light from regulators for an early-stage clinical trial testing its experimental treatment for COVID-19 and norovirus. It is also finalizing plans for a phase 2 influenza trial of a separate treatment, after pivoting away from an earlier program for hepatitis C virus.
Cocrystal develops “broad spectrum” compounds active against multiple viruses by targeting their replication machinery. The proprietary approach builds on a technique called x-ray crystallography to assess how compounds bind to viral components at the molecular level, enabling Cocrystal to generate a lot of leads for potential drugs.
“We’ve industrialized the process of creating these compounds and testing them,” said James Martin, Cocrystal chief financial officer and co-CEO.
The technology was developed in the lab of co-founder Roger Kornberg, a Stanford structural biologist who won the Nobel Prize for Chemistry in 2006 and serves as the company’s chief scientist and chairman of the board.
The long road
The new clinical trials come after a shift in priorities for the 15-year old company. Cocrystal announced safety and preliminary efficacy data in 2019 for a phase 2a trial against the hepatitis C virus, but has not found a partner to develop the compound further amid a market saturated with new drugs for the condition.
The company pivoted to the flu, and completed a phase 1 trial last year on a compound targeting influenza A viruses, setting the stage for the new phase 2 trial.
Cocrystal also signed a $4 million deal in 2019 with Merck to discover and develop antiviral agents against influenza A and B, with the potential for $156 million in milestone payments, plus undisclosed royalties on potential sales. Two years later, Cocrystal handed the compounds off to Merck, which has told Cocrystal it continues to develop them.
The company pivoted again during the pandemic to developing compounds against COVID-19, and added norovirus — known for running rampant on cruise ships — into the mix.
Keeping down costs
Martin, who was previously chief financial officer at several biotech companies, shares the CEO role with company president Sam Lee, a veteran of Icos Corporation, a Seattle-area company acquired by Eli Lilly in 2007. The pair took the helm after the 2021 death of previous CEO Gary Wilcox, a former Icos executive who co-founded Cocrystal with Kornberg.
“Sam takes care of all the science and works very closely with Roger,” said Martin, who works from his hometown of Miami. “I take care of everything else. It really allows us to focus on what we need to.”
Cocrystal keeps costs down by outsourcing “all grunt work,” like preclinical animal studies, to contract research organizations in India and China, said Martin. It also chose Australia for its early-stage clinical trials. The country offers to reimburse 42% of trial costs in an effort to bolster its biopharma industry, which has saved Cocrystal millions of dollars, said Martin.
Cocrystal spent $12.4 million on R&D and $5.7 million on general administrative expenses in 2022, and had $34 million on hand in March. “We are very tight with the money,” said Martin.
Financing the company
The company started as essentially “just a guy in a lab,” in Bothell, Wash., where it is now based, said Martin.
Cocrystal raised about $30 million in the private market from former Pharmacia and Upjohn CEO Fred Hassan; Emory University professor Raymond Schinazi, who took home about $440 million in 2011 with the sale of Pharmasset to Gilead; and billionaire Phillip Frost, CEO of diagnostics company Opko Health and former board chairman at Teva Pharmaceuticals. Institutional investors include Teva Pharmaceuticals, OPKO Health and The Frost Group.
Cocrystal went public in 2014 through a reverse merger with a shell company, and later that year completed a merger with Schinazi-founded company, RFS Pharma. Cocrystal has since pulled in $84.2 million from stock offerings and now has 15 employees.
Cocrystal’s stock is trading at about $3.00, down from its pandemic high of $24.36 in 2021 and all-time high of $104.40 in 2017 (the company also announced reverse stock splits in 2022 and 2018).
Looking to the future
Cocrystal is shifting to the U.K. for its later-stage influenza A trial. If the phase 2 trial is approved, Cocrystal plans to test the oral compound in “human challenge” studies in which patients are infected before being treated, in collaboration with hVIVO, a U.K. contract research organization that specializes in the approach.
Cocrystal’s new phase 1 trial in Australia was approved in May for COVID-19, and the company announced this week that the compound also is effective against norovirus in laboratory studies. The new study is designed to test safety and tolerability. If the trial is successful, Cocrystal plans to test the oral compound in separate phase 2 studies against the two viruses.
Multiple other companies are also developing treatments for COVID-19. Many antibody-based COVID-19 treatments are no longer useful against newer variants. And the widely-prescribed COVID-19 drug Paxlovid, approved for “emergency use” in the U.S., has drawbacks such as interactions with some other drugs.
There is no vaccine or approved treatment for norovirus, which causes 19 to 21 million illnesses annually in the U.S. and 900 deaths.
Cocrystal anticipates treating its first patient for its phase 1 COVID-19 and norovirus study within the next few months, and completing dosing and delivering top line data in 2024.
