Ep161: Jeff Stein on a Long-Lasting Flu Drug

Episode Summary

Executive Summary: Jeff Stein traces his path from academic microbiology to biotech entrepreneurship and explains Sidara Therapeutics’ CD388, a long-acting influenza antiviral designed as a drug-Fc conjugate to provide broad, season-long protection against A and B flu, including potential H5N1 threats. The conversation covers the platform science, Phase 2A data, a buyback from J&J, and a $240M financing to fund a 5,000-person Phase 2B trial.

Main Topics: Jeff Stein’s scientific and entrepreneurial background (Priority: 4/5): Stein describes his upbringing in California, early curiosity about nature and experiments, and training at UC San Diego and Caltech before moving from academia into biotech entrepreneurship. From natural products to biotech startups (Priority: 5/5): He explains how work on microbial genomics and quorum sensing led to founding companies like Quorex and Trius, culminating in FDA-approved antibiotics and lessons from antibiotic commercialization. Antibiotics, antifungals, and broken reimbursement economics (Priority: 5/5): Stein argues that hospital-infectious-disease drugs suffer from poor pricing, stewardship constraints, and weak investor incentives, which suppress innovation and make commercialization difficult. Sidara’s Cloudbreak/D-Fc conjugate platform (Priority: 5/5): He outlines the evolution from an antifungal immune-targeting concept to a broader drug-Fc conjugate platform that extends half-life, improves tissue exposure, and can be adapted to multiple diseases. CD388: long-acting universal influenza prevention (Priority: 5/5): The core program is a modified zanamivir-based neuraminidase inhibitor conjugated to Fc, intended as a single shot that could protect for a full flu season against A/B influenza and possibly pandemic strains. J&J partnership, divestiture, and buyback (Priority: 4/5): Sidara partnered with Johnson & Johnson, advanced CD388 through Phase 2A, then bought the asset back after J&J exited infectious disease and pursued divestitures, illustrating biotech resilience and timing risk. Phase 2B trial, public health, and pandemic preparedness (Priority: 5/5): Sidara is preparing a 5,000-subject Phase 2B study to establish dose and efficacy, with implications for stockpiling, immunocompromised patients, and preparedness against H5N1 or future flu pandemics.

Key Arguments: Stein argues that the best biotech founders often move from stable academic or industry roles into entrepreneurship when they see a scientifically compelling opportunity. He contends that antibiotic and antifungal markets are structurally broken because hospitals optimize for low acquisition cost, not innovation, depressing returns and reducing R&D investment. He says Sidara’s drug-Fc conjugate approach solves two major small-molecule problems at once: poor exposure/half-life and off-target toxicity. He argues CD388 is superior to monoclonal antibodies for influenza prevention because it is smaller, penetrates tissue better, can hit influenza A and B, and is more manufacturable at low dose. He claims the Fc-conjugated zanamivir derivative can provide season-long, universal anti-flu protection in every individual without requiring an immune response, which is especially valuable for immunocompromised patients. He notes that the program’s public-health value is high because a stable, stockpilable, refrigeration-stable product could be deployed against seasonal or pandemic flu without annual reformulation. He emphasizes that the Phase 2B design is powered to pick a dose after one season using 5,000 participants and a conservative infection-rate assumption. He frames the J&J buyback and new financing as evidence that small companies can persist through corporate strategy shifts if the science remains strong.

Data Points: Birthplace: Tokyo, Japan - Stein says he was born in Tokyo and came to California at about six months old. Academic timeline: Public schools through PhD at UC San Diego and postdoc at Caltech - He describes a fully public-school upbringing followed by advanced scientific training. Diversa tenure: 1994 through late 1998 - He worked at Diversa after Caltech before starting his first company. Quorex founding: Late 1998 / 1999 - He and Bonnie Bassler founded Quorex Pharmaceuticals around quorum sensing research. Trius founding: 2005 - His second company, Trius Therapeutics, was founded after venture work and Kauffman Fellowship experience. Trius acquisition: 2011 - Trius was sold to Cubist Pharmaceuticals after advancing tedizolid through approval. Sidara founding: January 2014 - The company was launched around the Cloudbreak antifungal platform. IPO timing: April 2015 - Sidara went public about 15 months after founding, during an open IPO window. J&J partnership date: November 2021 - Sidara partnered with Johnson & Johnson on CD388 at the preclinical stage. J&J buyback price: $85 million upfront - Sidara bought back CD388 after J&J exited infectious disease. Financing amount: $240 million PIPE - Sidara raised this to fund the Phase 2B study and beyond. Phase 2A dose: 150 mg - This dose showed efficacy in the challenge study and is the anchor dose for later development. Other Phase 2B doses: 300 mg and 450 mg - Sidara will test these higher doses alongside 150 mg and placebo. Phase 2B enrollment: 5,000 subjects - The upcoming study will enroll participants across North America and the UK. Assumed breakthrough rate: 2% - Trial sizing is based on a conservative seasonal infection assumption. Historical breakthrough rate cited: 3% to 3.5% - Stein says this is more typical than the conservative assumption. High flu season example: Over 9% - He cites 2022-2023 as an unusually large season. Expected breakthrough infections: Over 40 - Based on 5,000 participants and a 2% assumption, the trial should observe enough cases to power dose selection. Stability: 2 years so far - Current stability studies support at least two years of shelf life. Storage requirement: Normal refrigeration - He contrasts this with mRNA vaccines that require ultra-cold storage. Manufacturing comment: Competitive with mRNA vaccines - He says CD388’s cost of goods should be favorable for a biologic. Phase 1/2 conclusion: Efficacious exposure forecast for 4 to 6 months - Human data support long-duration exposure after a single dose.

Pivotal Quotes: "What if we could take the approaches of cancer immunotherapy and apply it to infectious disease, completely novel approach, and particularly by specific immunotherapy." — Jeff Stein: He describes the founding concept behind Sidara’s Cloudbreak platform. "We think there could be an opportunity to partner with a big pharma, much like Moderna did." — Jeff Stein: He discusses scaling risk and potential response if a flu pandemic forces rapid manufacturing expansion. "It's not a matter of if, it's a matter of how severe." — Jeff Stein: He explains why pandemic preparedness for influenza remains necessary despite uncertainty about timing.

Implications: CD388 could become a new class of seasonal or pandemic flu prevention: long-acting, stockpilable, and usable in people who respond poorly to vaccines. For biotech, the story shows how platform science, persistence, and timing can turn a stranded asset into a potentially category-defining product.