To help progress and financially back the drug's development, the Florey and Starfish Ventures, a leading Australian venture capital firm, have formed a start-up company, 'Nephrodynamics Pty Ltd'.
Septic shock can occur if a patient contracts a bacterial infection after surgery. It is the main cause of mortality in Intensive Care Units (ICUs) and has up to a 40% mortality rate.
Patients who experience acute kidney failure during septic shock can require dialysis for up to two weeks, which costs the national health budget $50 million annually.
Nephrodynamics's research has focused on treating kidney failure during and after septic shock, but the drug it is developing could eventually treat other causes of kidney failure.
Dr Clive May from the Howard Florey Institute said the mechanisms causing the blood flow changes in kidney failure were unknown.
"It is currently thought that blood flow to the kidneys is due to constriction of the blood vessels in the kidney but we have proven this theory incorrect.
"This discovery has helped us develop a drug that could be a kidney-saving therapy for septic shock patients," Dr May said.
Head of Research at the Austin Hospital's Intensive Care Unit, Prof Rinaldo Bellomo, said this drug could not only prevent kidney failure in patients with infection, but also in those with other causes of acute kidney injury.
"Kidney failure from septic shock has a high mortality rate and the current treatments are inadequate, so we urgently need a therapy to save the kidneys and lives of those who develop septic shock," Prof Bellomo said.
"The first stage of clinical trials soon to be conducted will give us an indication of the potential benefits of our new kidney protective septic shock treatment," he said.