Inside a single-story brick building in Sorrento Mesa is a small lab sprinkled with beakers, test tubes and incubators that is worth billions of dollars.
This is where Cidara, a small San Diego pharmaceutical company, created what the scientific community has talked about for decades — a kind of universal flu shot that fights all forms of influenza.
The most recent clinical trial was so successful that pharmaceutical giant Merck recently announced it would buy the company for $9.2 billion.
“It’ll be a new paradigm,” said Dr. Robert Schooley, professor of infectious diseases at the UC San Diego School of Medicine. “It’s hard to see a blind spot on the basis of that phase 2b trial, and I understand why Merck was optimistic enough to purchase the whole company.”
Going viral
For centuries, the human body has been playing cat and mouse with the flu.
Influenza mutates. The human immune system adapts.
Each year, the cycle begins anew in Asia, where novel strains first take hold. After a relatively quick study, Australian hospitals choose what they think is the strain of the season, like Vogue picks the color of the year. Those hospitals then create “this year’s vaccine,” and the rest of the world follows.
While vaccines do aid in prevention, studies show that they only work 30% to 60% of the time for healthy individuals and even less for those over 65, according to the Center for Disease Control and Prevention.
But this new flu preventative isn’t a vaccine — it’s an entirely new antiviral drug class.
Cidara was founded on the concept of applying immunotherapy approaches to infectious disease, explained Dr. Jeff Stein, CEO and co-founder of Cidara.
The science behind CD388
When a virus enters the body, it attaches to the cell, enters inside, multiplies hundreds of times, then “clips itself off the surface of the cell,” to infect others, Schooley explains.
Cidara’s proprietary molecule, CD388 prevents the virus from “unclipping … so the virus is no longer infectious,” Schooley said.
Since the 1940s, vaccines have been the primary way people fight the flu. By introducing a weak or inactive virus, the immune system will recognize and learn to defend against those strains. So, the next time the body encounters that specific virus, it will “remember” how to fight it.
Unlike vaccines, CD388 works directly against every strain. By attacking a protein that is essential for replication, the molecule works against every influenza mutation, Stein explains.
In the latest phase 2b trial, 5,000 participants received varying doses of the drug. At the highest dose, the drug showed 76% efficacy —surpassing the 60% threshold for herd immunity. Moreover, the results proved to be extremely reliable. The study published its findings with a statistical significance of 0.0001.
“I’m not aware of anyone who is developing a similar modality,” said Stein. “There could be competitors attempting to replicate in stealth mode, but they have to play catch-up.”
CD388 probably won’t replace vaccines — at least not yet — explained Davey Smith, an infectious disease specialist and translational research virologist at UCSD.
“We have decades of experience with vaccines, studying how safe they are. We don’t have the same data for this particular drug. Can somebody get this year after year? What does that look like? All of those questions will come with time,” Smith said. “We will see how it does in a bigger trial.”
Stein is equally as cautious. He knows that the FDA is stringent and success is slim — about 10% of drugs get FDA approval.
“You can always be surprised by a trial. It’s in Merck’s hands now,” said Stein.
A CEO, but a scientist first
There’s a bit of déjà vu in this billion-dollar deal.
Cidara isn’t Stein’s first venture. It’s his third.
Stein technically sold his last company to Merck, and now the pharma giant is acquiring his latest venture.
He founded Trius Therapeutics, which was sold to Cubist in 2013 for $703 million, and Cubist was later bought by Merck. Before that, Stein started Quorex, his first company, which Pfizer acquired in 2005 for an undisclosed amount.
Stein never really saw himself as a CEO all those years ago when he was working on his doctorate in biochemistry and microbiology at UC San Diego and the Scripps Institution of Oceanography. Back then, he spent time studying hydrothermal vents from a submersible 8,000 feet underwater. (He conducted his postdoctoral research at Caltech before returning to La Jolla as a researcher at the Agouron Institute.)
In his 40-person lab, cubicles line the gray carpet next to a communal Keurig. The C-suite is a small, windowless office whose focal point isn’t the numerous awards or the photo of Stein with Barack Obama, but a life-size marlin mounted in the middle of the room.
He can explain the symbiotic traits of chemosynthetic microorganisms and, in the next breath, switch lexicons to talk about his company’s stock and reverse splits.
Decades of invention and acquisition equipped Stein to close this $9 billion sale. Still, he admits that while developing CD388 was hard, organizing hundreds of millions of dollars to test the molecule proved to be just as difficult.
If Cidara hadn’t been able to orchestrate a buyback from Big Pharma, sell off its first flagship drug, implement a major consolidation of its stock — and execute each of these deals in one 24-hour period— the universal flu shot may have never gotten off the ground.
Cidara’s start
After selling his first two companies, Stein had barely a year before three scientists approached him with an idea for a new startup: Apply the principles of immunotherapy to infectious diseases.
So he agreed, Cidara was created in January 2014, and research started — but the focus was not on influenza. Cidara’s first drug was for fungus. Fungal infections can be deadly and hard to treat, Stein explained, because humans and fungi are surprisingly close relatives. A drug potent enough to kill fungus is often just as toxic to the human body.
He recruited his longtime friend and colleague, Bonnie Bassler, a National Medal of Science winner and a recipient of the Wolf Prize in Chemistry, to co-found Cidara. Bassler and Stein first met as researchers at Caltech, where they started their first company, Quorex.
“I always try to recruit people that are much smarter than I am,” said Stein. “So yeah, she’s fantastic.”
They raised $42 million in Series A funding in May 2014 and went public the following January. At the time, the company was “largely a science experiment,” Stein admitted.
After some success and some failure, the flagship antifungal drug, Rezafungin, was approved by the FDA and European Medicines Agency in 2023 and is now commercially available in the U.S. and EU.
While Rezafungin was going through clinical trials, Stein and Bassler had started to work on another drug, but this one —CD388 — would fight influenza.
Big Pharma almost kills the universal flu shot
Johnson & Johnson was interested in this new drug, and it helped fund the first clinical trials of CD388. But later in 2023, it announced that it would divest from all infectious-disease research around the globe.
At the time, it was preparing to acquire CD388. “Based on the strength of the data, they were preparing this document, and it was ready to sign. But that’s when they had a new head of R&D came in,” said Stein.
The new head of R&D took over and abruptly scrapped the deal.
“When Big Pharma pulls out, the knee-jerk reaction is that something’s wrong with the molecule,” Stein said.
Though the conglomerate pulled out, former Johnson & Johnson researchers familiar with CD388 wanted in. They had left the pharma giant to team up with Google Ventures and pursue the global development and commercial rights to what would become the universal flu shot.
Stein launched his own syndicate, ultimately buying back his company for $87 million, beating out Google Ventures.
To fund this buyback, Stein sold his stake in Rezafungin, which saved the company $128 million; enacted a 20-to-1 reverse stock split; and later secured $240 million of private capital to fund the next trial of CD388.
Because of federal disclosure rules, the deals were negotiated separately but were announced simultaneously in April 2024. “There were myriad deal terms in each one of those contracts. It’s just miraculous we were able to sign them all in 24 hours.”
By early April, “we were trading at 50 cents a share, and here we are trading above $220,” said Stein. “That would not have happened if we did not manage to sign all three of those contracts at the same time.”
The final phase
Now Cidara is entering what could be its final phase of testing for CD388.
Cidara finished enrolling 6,000 participants for its final trial in November. This trial includes people who are at risk of severe complications from the flu, are immunocompromised and, at the request of the FDA, people over 65 years old.
Interim results from this trial are expected in the first quarter of 2026.
“Nothing is absolutely certain,” said Schooley. “They’re now doing their largest trial that will absolutely nail down that this approach works.”
In the meantime, Cidara is working on its U.S. manufacturing strategy.
Today, the clinical trial shots are manufactured in WuXi, China, where a majority of other pharmaceutical products are manufactured, Stein explained. But the company has signed a federal contract to onshore manufacturing.
In October, Cidara received a federal award valued up to $339 million from the Biomedical Advanced Research and Development Authority. The U.S. government sees manufacturing CD388 stateside as “critical for pandemic preparedness,” Stein said in federal filings announcing the award.
“If all goes to plan,” retail pharmacies could administer CD388 shots as soon as summer 2027, speculates Stein, but it’s now up to Merck to bring the drug to market.
Selling the company was always the plan, Stein said. After the Merck sale closes on Jan. 7, he will no longer have a stake in Cidara. He remains on the board of Ideaya Biosciences and is open to advising other startups.
“I haven’t said goodbye yet,” Stein said. “I’ll tell you then (Jan. 7) if it’s sad to see it go.”
With three companies already under his belt, Stein didn’t rule out a fourth. “Never say never,” he said.
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