Advanced Life Makes Progress

Advanced Life Sciences (Nasdaq: ADLS  ) reported positive data in an anthrax study last week for its potential antibiotic cethromycin. In March, cethromycin was granted an FDA Orphan Drug designation for this indication. Cethromycin is an experimental antibiotic shown to be more effective in a primate study after anthrax exposure compared with ciprofloxacin, which is the current standard treatment.

Looking ahead, June will be a pivotal month for the company because it's expected to release the results from two phase 3 trials for cethromycin in the treatment of community acquired pneumonia (CAP). Cethromycin is classified as a second-generation ketolide antibiotic with a unique mechanism of action against bacteria such as anthrax and other respiratory bugs, overcoming concerns of emerging bacterial resistance to widely used fluoroquinolone antibiotics such as ciprofloxacin.

Analysts are bullish on the prospects for Advanced Life, with catalysts expected to move the stock including: reporting positive phase 3 trial results for cethromycin in CAP, signing a co-promotional partnership deal for the drug later this year, filing a New Drug Application for cethromycin by the end of June, and receiving FDA approval with potential launch of the drug by the end of 2008.

If the developments outlined above play out favorably for Advanced Life, the share price would likely increase substantially. Upon approval, cethromycin will have two potential markets, including federal government purchases under Project BioShield to stockpile the drug in case of an act of bioterrorism involving anthrax, and primary care physicians for the treatment of respiratory tract infections such as CAP. The key event in the near term will be results from the two phase 3 trials for cethromycin in the treatment of CAP, which I expect to be positive based on previous results of the drug.

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Fool contributor Mike Havrilla, R.Ph., B.S., Pharm.D., is a Rite Aid pharmacist who lives, writes, works, and enjoys running on the streets and trails in the small Pennsylvania town of Portage. He invites your comments and feedback. Mike does not have a position in any company mentioned in this article. The Fool has a disclosure policy.