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A LifeX startup company is taking aim at antibiotic-resistant infections in artificial joints, which have few good treatment options for doctors and consequences for the patient that can be painful and costly.

Oakland-based Peptilogics Inc. has received approval from Australia’s Therapeutics Goods Administration to begin the first in-human study of its PLG0206 product, which targets prosthetic joint infections. The clinical trial received ethics approval from the Bellberry Human Research Ethics Committee.

“Everyone knows someone who’s had one, but I wasn’t aware how devastating the infections could be,” said Peptilogics founder and CEO Jonathan Steckbeck, 42. “There are only a few effective therapies, and none are terribly effective.”

Peptilogics is an early clinical stage biotechnology company and among 10 startups in the LifeX portfolio of 16 companies that are seeking to develop therapeutic agents. LifeX is a nonprofit South Side small business accelerator funded by the University of Pittsburgh.


LifeX Ventures founder and CEO Dietrich Stephan of Squirrel Hill leads a meeting to discuss the progress of several health and wellness companies Wednesday Nov. 28, 2018, at LifeX on the Southside. This University of Pittsburgh-funded nonprofit, aids research groups that hope to produce new medical therapies that aid patients. (Jessie Wardarski/Post-Gazette)
LifeX startups face especially long odds in attacking some of medicine’s biggest challenges

Six-year-old Peptilogics, which also has an office in San Jose, Calif., does not yet have revenue. The startup has raised $6.8 million from investors, including Peter Thiel, founder of the Founders Fund of San Francisco; Pine-based BlueTree Venture Fund; and serial entrepreneur Stefan Roever, who lives in Bonn, Germany.

The death of his father-in-law in 2004 from a bacterial infection spurred Mr. Steckbeck’s interest in antibiotic-resistant microbes, he said. The company has two full-time employees and 12 contractors.

Taking risk is necessary for growth. This series profiles the region’s entrepreneurs, policymakers, scientists and others who have embraced challenges and incorporated new ideas – sometimes the kind that seem a little crazy – into their plans.
Infection of an artificial hip or knee joint can arise any time after surgery, a condition Mr. Steckbeck called “heartbreaking,” and affects 20,000 people annually. The number is expected to rise as joint replacement surgeries increase with an aging population.

More than 1.2 million hip and knee replacements were performed during the year ending in August, according to the American Academy of Orthopaedic Surgeons. Studies have shown that 1 percent to 2 percent of those operations will result in an infection on the biofilm that forms on the implant.

Physician Neel Shah, an infectious disease specialist at the University of Pittsburgh, said that when a new joint becomes infected, sometimes the only option is to remove the prosthesis, a procedure that has a success rate ranging between 80 percent and 90 percent. Treatment of an infection with the joint in place has a variable overall success rate, between 20 percent and 80 percent.

One choice for treating a joint without removal of the implant is opening the incision and flooding the new joint with an antibiotic solution, a practice that Mr. Steckbeck called a “powerwash.” The procedure often fails, he said, and the cost of treating prosthetic joint infections can reach $100,000.

In a recent experiment, Peptilogics created an infected biofilm on an artificial joint before saturating the implant with commonly used antibiotics, Mr. Steckbeck said. Not all of the bacteria were killed, even after 24 hours of exposure.

But with the Peptilogics product, which is being developed as an injectable drug, essentially all of the bacteria were dead within 30 minutes.

The first Food and Drug Administration-approved trial in humans is anticipated at the end of 2019, Mr. Steckbeck said. If all goes well, the drug could be commercialized for use in the U.S. within a few years, he said.

Expedia Group’s $21.5 million acquisition of Chicago-based ApartmentJet Inc. translates into a windfall for angel investors in Pittsburgh.

BlueTree Venture Fund and BlueTree Allied Angels will realize a 4.3 times return on its combined $450,000 investment in less than a year, said Catherine Mott, founder, CEO and managing partner of 15-year-old Wexford-based BlueTree Capital Group LLC.

“This is the quickest exit we have ever experienced,” Mott said.

The venture fund invested $150,000 in ApartmentJet last November and the angel group invested $300,000 in the young company in February, she said.

“On average, our previous profitable exits range with holding periods of four to six years,” Mott said. “The largest return historically for us is Wombat with a 12 times return.”

In February, Pittsburgh-based Wombat Security Technologies, a security awareness and training software firm, was acquired for $225 million by Proofpoint, a Silicon Valley cybersecurity company. BlueTree Allied Angels invested $266,500 in Wombat over a three-year period.

BlueTree Venture Fund has $10 million and BlueTree Allied Angels has $40 million under management.

ApartmentJet is a web-based platform to help multifamily property owners and management companies take advantage of the growing market for short-term rentals.

“Demand for short-term rentals in U.S. urban destinations has been growing impressively over the past several years,” Mark Okerstrom, Expedia (Nasdaq:EXPE) president and CEO, said in a prepared statement. “In order to be able to deliver our customers what they are asking for while at the same time promoting responsible renting, Expedia Group is committed to delivering solutions that give urban building owners, managers and communities control and transparency over short-term rentals.”



Thread International moves to Homewood, employs locals and launches its own line of recycled backpacks





Oakland startup wants to battle the invasion of the superbugs
Pittsburgh Post-Gazette logo
Pittsburgh Post-Gazette
6:30 AM DEC 18, 2017
The conversation went something like this a couple years back when Jonathan Steckbeck met Dietrich Stephan at a Tuesday morning networking event:

“We think we have the cure for the looming superbug epidemic,” Mr. Stephan recalled the 41-year-old entrepreneur saying. “I said, ‘Oh, really. Send us all your stuff.’”

The introduction paid off. Mr. Steckbeck’s company, Oakland-based Peptilogics Inc., recently closed on a $5.5 million Series A financing round led by Facebook Inc.’s first major investor Peter Thiel. Mr. Stephan, a serial entrepreneur and chair of the department of human genetics at the University of Pittsburgh, has become Peptilogics chairman.

Moreover, Peptilogics is among 10 startup companies that will have work space in Pitt’s new business accelerator that is planned for the Strip District — all things that happened after a chance meeting over coffee.

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Peptilogics, which now employs 15 people, is preparing for clinical trials of its first product by mid-2018, a medicine to treat the toughest infections. Marketing of its first product will hinge on how well the clinical trials go.

“The company is developing a set of products — new antibiotics — that work in a way that no other antibiotics work,” Mr. Stephan said. “They kill every type of bacteria we have exposed our products to. This is a looming global epidemic and we feel like we’ve got the answer to that, and I think the market agrees.”

A World Health Organization report in September identified 51 new biologicals and antibiotics in clinical development to treat priority antibiotic-resistant organisms, but only eight of those were classed by WHO as innovative treatments that will add value to current treatments.

“Antimicrobial resistance is a global health emergency that will severely jeopardize progress in modern medicine,” WHO Director General Tedros Adhanom Ghebreyesus said in a prepared statement.

Peptilogics’ secret, licensed from the University of Pittsburgh, kills bacteria by creating weak spots in cell membranes, leading to cell death. That’s a shift from having to get inside the cell to disrupt the inner workings, which is how antibiotics have worked for decades.

The 5-year-old company, which also has an office in San Jose, does not yet have revenue.

Mr. Steckbeck, a native of Lebanon, Pa., and Peptilogics president and chief scientific officer, received an MBA as well as an PhD in biochemistry, at Pitt. He became interested in how amino acid chains, called peptides, interact with membranes during his doctoral work, then focused on how peptides can be harnessed to weaken bacteria cell membrane as a post-doc.

Mr. Steckbeck also was deeply affected by the death of his father-in-law 13 years ago from a bacterial infection despite care in “one of the best hospitals in the world.”

“Unless you have a very clear, personal demonstration, you understand on a theoretical level that these things are possible,” he said. “At that point, in 2004, it wasn’t theoretical any more.”

Peptilogics’ target is bacteria that inevitably find ways to resist antibiotics and cause life threatening diseases.

More than 2 million people are sickened each year by antibiotic resistant infections, resulting in at least 23,000 deaths, according to the Centers for Disease Control and Prevention. Antibiotics are among the most commonly prescribed medications, but up to half of the prescriptions are not needed or effective — setting the stage for drug resistance.

Among the organisms that Peptilogics’ first product will target are so-called Gram-negative bacteria. Pneumonia and bloodstream infections are among the problems caused by the bacteria.

New drug development can be a costly venture. Not so long ago, pharma startups needed a partner, a much larger drugmaker, for example, to bring a new medicine to market.

But Peptilogics has held down overhead and operating costs and may not need big capital infusions to see the company through its early stages, including proof-of-concept clinical trials, said 50-year-old Sanjay Kakkar, a physician and entrepreneur and Peptilogics CEO. “We are very well positioned in the early- to mid-stages as an independent company.”

Kris B. Mamula: kmamula@post-gazette.com or 412-263-1699


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