The U.S. manufacturing partner of Halifax drug discovery company Appili Therapeutics has won Food and Drug Administration approval to sell Appili’s liquid formulation of the common antibiotic metronidazole under the name LIKMEZ.

The news comes just four months after Appili announced it had secured a U.S. patent for the new formulation, which will be manufactured and sold south of the border by Long Island’s Saptalis Pharmaceuticals.

“The FDA approval of LIKMEZ, shortly after securing patent coverage through 2039, is an important milestone that demonstrates Appili’s ability to identify promising opportunities and develop and monetize them for the benefit of both patients and shareholders,” said Appili CEO Don Cilla in a statement.

“Appili was formed to develop ATI-1501 (LIKMEZ) and it is exciting to see our first development project make it to market. This is a tremendous team accomplishment. We are all delighted that the product will soon be available to patients and we look forward to bringing additional products to market that tackle serious global challenges in infectious disease.”

Cilla, who was previously Appili’s chief development officer, became CEO in November. He is also an adjunct professor at Northeastern University, where he teaches biotechnology and economics to graduate students. The company itself was founded in 2015 under the leadership of then-CEO Kevin Sullivan, who is now chief executive at advanced materials-maker 3D BioFibR.

Metronidazole, meanwhile, is widely used to treat a range of bacterial infections, such as rosacea, dental abscesses and postoperative infections. More than 10 million prescriptions for the drug are written annually in the U.S.

For the first quarter of Appili's fiscal year 2024, which ended June 30, the company posted a net loss of about $1.5 million, representing an $800,000 improvement compared to the same period for the year prior. The company also reported a decrease in cash on hand to $500,000, compared to $2.5 million the quarter prior.

In a statement, Appili said it is “dependent in large part” on a two-year, US$14 million research and development deal with the Department of Defence for a vaccine against Tularemia — a pathogen with potential applications as a bioweapon.

The deal is an expansion of an existing agreement from Feb. 2021 and will see the U.S. government fund Appili’s “nonclinical” manufacturing and regulatory activities related to the vaccine with the ultimate goal of filing a new drug application with the F.D.A.

“Due to delays in reimbursement for previously submitted invoices in the near term, Appili entered into a definitive agreement with respect to an unsecured $300,000 bridge loan from Bloom Burton & Co,” said Appili in a statement, referring to the Toronto investment bank that provided some of the company’s initial startup capital.

Appili management also warned in a regulatory filing June 30 that a lack of immediately available funds to pay for operating expenses left the company's ability to continue as a going concern in doubt.

"While the Company has potential sources of cash of approximately $1.8 million as at June 30, 2023, as well as access to potentially the remaining USAFA funding, management does not believe these resources will be sufficient to fund operations and current working capital requirements, for the next twelve months, unless further financing is obtained in the near term," said management.

Appili shares, which trade on the Toronto Stock Exchange, briefly rose to eight cents on the news Monday before reversing those gains and falling back to their opening price of six and a half cents. The company's market cap currently sits at $7.23 million.