Appili Therapeutics said Monday it will sponsor the first clinical trial in Canada evaluating Fujifilm Toyama Chemical’s drug Favipiravir for the prevention of COVID-19.

The Halifax company dedicated to fighting infectious diseases last November bought the rights to develop a new anti-fungal drug candidate from Fujifilm Toyama, and the announcement Monday shows the two companies are deepening their relationship.

Fujifilm Toyama will support the Phase 2 trials by providing supplies of Favipiravir, which is approved in Japan as the anti-influenza drug Avigan.

Appili has filed the clinical trial application with Health Canada and expects to initiate the trial at long-term care facilities in Ontario as soon as possible after receiving regulatory clearance.

“This program illustrates our commitment to leverage our relationships and expertise to do the right thing for patients and public health.” said Appili CEO Armand Balboni in a statement. 

Shares of Appili, which has listed on the TSX Venture Exchange and recently raised $10.25 million, rose 14 percent in late trading on Monday to a record high of $1.70.

In 2014, Japanese health authorities approved Favipiravir, a broad-spectrum antiviral developed by Fujifilm Toyama, as a treatment in a pandemic influenza outbreak.

Favipiravir was also used in a clinical trial to address the Ebola outbreak in Guinea.

Fujifilm Toyama is actively supporting several controlled clinical trials for Favipiravir to investigate its use against COVID-19.     

Researchers in Wuhan, China, reported in early February that Favipiravir demonstrated anti-viral activity against SARS-CoV-2. Small-scale trials conducted in China also indicated that Favipiravir may provide clinical benefit in patients with COVID-19.

“We have an ongoing relationship with Appili and are pleased to support the company in its efforts to assess Favipiravir for the potential benefit of Canadian patients,” said Fujifilm Toyama President Junji Okada. “We are well-aligned with Appili in our commitment to innovative R&D work that may address public health crises by mitigating the threat of deadly infections.”

Appili will take Favipiravir through what’s known as a “cluster randomized placebo-controlled trial”, in which patients will be recruited at several long-term care facilities throughout Ontario. The main goals are to assess the safety and effectiveness of Favipiravir in preventing further COVID-19 outbreaks in long-term care facilities. Secondary goals include assessing Favipiravir’s potential to inhibit the progress of the disease.

As of May 2020, the majority of deaths in Canada resulting from COVID-19 have occurred in long-term care facilities, making this population especially vulnerable.