Summit Corporation plc Antibiotic Eligible For Fast Track

Summit Corporation plc (LON: SUMM)’s new antibiotic treats C. difficile infection — a healthcare threat in hospitals and care homes.

Mark Stones

Mark Stones (TMFMumbojumbones) joined The Motley Fool in 2014 and initially worked as a writer for Fool.co.uk, before joining the Fool’s analyst programme. Mark earned a BA in English from Loughborough University. Although he spends more time reading annual reports than Russian literature these days, he still appreciates a novelist’s antipathy toward the accepted view, which is a useful attitude when trying to sniff out hidden gems on the stock market. His approach to investing has been largely influenced by the principles of Warren Buffett and Peter Lynch. He also takes a special interest in the work of healthcare companies. Outside of investing, Mark plays guitar, enjoys good writing and has a guilty passion for combat sports.

Published 9 July, 2014 1:49 pm BST

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The Oxford based drugmaker Summit Corporation (LSE: SUMM) announced today that the antibiotic SMT19969 has been designated by the US regulator as a Qualified Infectious Disease Product (‘QIDP’).

The drug, which treats C. difficile infection, is therefore eligible for priority review and fast track status under the Generating Antibiotics Incentives Now Act.

The QIDP designation also qualifies SMT19969 for five additional years of marketing exclusivity.

The chief executive, Glyn Edwards, said:

“This status recognises the serious healthcare threat posed by pathogens such as C. difficile and it will confer a number of advantages that will accelerate the development of this promising and differentiated antibiotic with the potential to treat initial CDI and reduce the high rates of disease recurrence, the major clinical issue.”

Summit shares trade at 17 times forecast earnings which is a more punchy valuation than its blue-chip sector peers. The decision to ‘buy’ would depend on further investigation into the drugs pipeline.