Recce Pharmaceuticals (ASX: RCE) has confirmed it has received an extra A$861,590 from the Australian Government for its overseas Advanced Drug Development expenditure in financial year 2017 under the government’s Research and Development Tax Incentive program.
The additional backing brings the Commonwealth government’s total backing for the synthetic broad-spectrum antibiotics developer close to A$1.3 million last financial year.
Recce welcomed the additional R&D support as government recognition of the return on investment opportunities its antibiotic program offered both locally and internationally.
The company’s executive chairman Dr Graham Melrose expressed Recce’s gratitude, saying, “We are very appreciative of the support and acknowledgement of our work by the Australian Government as we seek to address the very urgent challenge posed by the increasing incidence of antibiotic resistance in Australia and globally.”
Lead antibiotic candidate
Recce’s patented lead candidate is the RECCE 327 antibiotic which the company is hoping to take into human trials.
The antibiotic was developed to treat blood infections and sepsis caused by Escherichia coli or Staphylococcus aureus bacteria and their superbug forms.
Dr Melrose said today the company was on track to progress the 327 antibiotic into clinical trials in humans.
Recce has already had positive results from pre-clinical testing in animals and the laboratory, in both Australia and overseas.
The company has also developed an automated manufacturing process for the lead compound and has a manufacturing facility in Australia.
Recce is also in talks with clinical research partners in the US.
Recce’s R&D backing
At the beginning of the year the Australian Government confirmed it could allocate AU$2.43 million to synthetics developer Recce via a 43.5 per cent rebate on A$5,605,709 of the company’s international research and development expenditure for the financial years 2017, 2018 and 2019.
Recce pulled in A$1,288,516 last year by spending about A$2,932,105.
If the developer spends the remaining sum of about A$2,673,603, it can claim another A$1,163,017 to collect the full rebate this financial year and in FY2019.
Recce said no covenants, repayment provisions, equity dilutions or access to the company’s patented technology were relevant to it receiving the financial support.
The company’s securities closed up 24.1% to A$0.18.