Recce Pharmaceuticals Advances RECCE 327 Phase 3 Trials with Strategic Licensing and Patent Wins

Narrowed Loss Amid Clinical Momentum

Recce Pharmaceuticals (ASX:RCE) reported a 30% reduction in its operating loss for the financial year ended 30 June 2026, with the loss shrinking to AUD 14.96 million from AUD 21.43 million the previous year. This improvement was driven primarily by decreased research and development expenditure and bolstered by an AUD 8.88 million R&D tax incentive rebate.

While the company remains unprofitable, the narrowing loss reflects a disciplined approach to funding its clinical programs, notably its lead synthetic anti-infective candidate, RECCE® 327.

Phase 3 Trials Progress in Indonesia and Australia

Recce’s flagship Phase 3 clinical trial for diabetic foot infections (DFI) is well underway in Indonesia, with patient dosing active across five sites in one of the world's largest DFI populations. The trial targets up to 310 patients, with an interim analysis planned after approximately 155 patients, aiming for a statistically significant positive endpoint. The Indonesian National Agency of Drug and Food Control’s (Badan POM) recent comprehensive regulatory inspection of a trial site concluded with no findings, a critical de-risking milestone that supports the integrity of the data and the study's continuation.

In Australia, Recce secured Human Research Ethics Committee approval to upgrade its Phase 3 DFI trial to a pivotal study, expanding patient eligibility to include both mild and moderate infections. This trial incorporates an active-controlled, non-inferiority design comparing RECCE 327 Topical Gel (R327G) against established antibiotic treatments, aligning with regulatory standards of both the Therapeutic Goods Administration (TGA) and the US Food and Drug Administration (FDA). The dual-market strategy aims for regulatory submissions in Australia and the US, targeting approvals by 2028.

Strategic Licensing and Commercial Expansion

On the commercial front, Recce signed a non-binding term sheet with a leading Middle Eastern pharmaceutical company for an exclusive 10-year licensing deal covering 12 countries across the Middle East and North Africa (MENA) region. This partnership aims to leverage the region's high diabetes prevalence and unmet medical needs in infectious disease management, potentially opening a US$1.5 billion ASEAN and MENA market opportunity.

To support ongoing clinical and commercial activities, Recce completed a capital raise of AUD 6.4 million through an institutional placement and Share Purchase Plan, strengthening its balance sheet alongside a debt facility with Avenue Capital Group. The company also secured an advanced overseas finding of up to AUD 85 million from the Australian Department of Industry, Science and Resources, extending its R&D tax incentive eligibility to global expenditures over three years.

Patent Portfolio Growth and Preclinical Advances

Recce expanded its intellectual property protections with Family 4 patents granted in Hong Kong and Brazil, extending patent coverage to key pharmaceutical markets and reinforcing its global footprint. The portfolio now spans over 40 patents and applications across major jurisdictions with protection through to 2041.

Preclinical programs advanced with positive data supporting RECCE 327’s broad-spectrum activity. Notably, nebulised R327 demonstrated a >99.99% bacterial burden reduction in a murine model of hospital-acquired pneumonia caused by carbapenem-resistant Acinetobacter baumannii, a critical priority pathogen. Additionally, R327G showed statistically significant reductions in bacterial load and superior wound healing in rat burn wound infection models against MRSA and Pseudomonas aeruginosa, outperforming the standard comparator Soframycin.

Collaborations with U.S. Military Research

Recce deepened its collaboration with U.S. military research institutions, entering a second Cooperative Research and Development Agreement with the U.S. Army Institute of Surgical Research. These partnerships, alongside a US$2 million Congressionally Directed Medical Research Program grant, underscore growing strategic interest in R327G as a next-generation anti-infective for combat and civilian trauma care.

Corporate and Governance Notes

The company mourned the passing of its founder and original technology inventor, Dr Graham JH Melrose, whose pioneering work laid the foundation for Recce’s synthetic anti-infective platform. The Board reaffirmed its commitment to advancing Dr Melrose’s vision to combat antibiotic resistance globally.

Recce’s corporate governance remains robust with a Board comprising experienced executives and independent directors, overseeing the company’s strategic direction through committees focused on audit, risk, nomination, and remuneration.