Flex Pharma and Salarius Pharmaceuticals announced that the companies have entered into a definitive merger agreement under which privately-held Salarius will merge with a wholly-owned subsidiary of Flex Pharma. Management believes that the proposed transaction will position the combined company to recognize multiple value inflection points based on Salarius’ clinical pipeline, which targets rare, orphan cancers with no targeted treatments and cancers that have a high unmet need. Salarius recently completed a $6.4M private placement, which combined with cash from Flex Pharma is expected to fund the combined company to mid-2020, allowing it to report early cohort data from an ongoing Phase 1 Ewing sarcoma trial. Upon the closing of the transaction, Flex Pharma stockholders will own approximately 19.9% of the combined company and current Salarius investors will own approximately 80.1% of the combined company. Flex Pharma stockholders will also receive a right to receive warrants, six months and one day following the closing date of the transaction, allowing them to purchase additional shares. The total value of these warrants will be calculated such that upon exercise Flex Pharma stockholders would own an additional 2.4%, or a total of 22.3%, of the value of the combined entity, subject to adjustment based on Flex Pharma’s net cash at closing. Upon closing of the transaction, Flex Pharma is expected to be renamed Salarius Pharmaceuticals and be under the leadership of Salarius’ current management team, led by CEO David Arthur. The Salarius clinical pipeline will become the lead assets of the company following the transaction. Flex Pharma President and CEO William McVicar, Ph.D., is expected to join the Board of Directors of the combined company following the closing of the transaction. Salarius’ lead compound, Seclidemstat, targets the epigenetic dysregulation underlying Ewing sarcoma, a devastating pediatric, adolescent and young adult bone cancer for which no targeted therapies currently exist. Seclidemstat is a differentiated, reversible inhibitor of the lysine-specific demethylase 1 enzyme, or LSD1, which is a widely studied epigenetic enzyme and a validated drug target for clinical development. The company is currently enrolling patients in an open-label Phase 1 dose escalation/dose expansion study, which is expected to conclude in 2020. Salarius is also preparing to initiate additional studies in advanced solid tumors, including prostate, breast and ovarian cancers. The transaction has been approved unanimously by the Board of Director of Flex Pharma and Board of Managers of Salarius. The proposed transaction is expected to close in the first half of 2019, subject to the approval of Flex Pharma stockholders at a special stockholder meeting and other customary conditions, including approval by Salarius’ members.
Friday, January 4, 2019
Sesen Bio downgraded to Neutral from Buy at H.C. Wainwright
H.C. Wainwright analyst Ramakanth downgraded Sesen Bio to Neutral and lowered his price target for the shares to $1 from $3. While the Phase 3 Vista results “appear decent in isolation,” the failure to improve on the Phase 2 results despite a more rigorous treatment schedule introduces additional uncertainties on the regulatory and commercial prospects of Vicinium, Ramakanth tells investors in a research note. The full Vista results are not expected until mid-2019, which could potentially render the stock range-bound until then, says the analyst.
AngioDynamics backs FY19 adj. EPS view of 82c-86c, consensus 84c
Backs FY19 revenue guidance of $354M-$359M, consensus $356.09M.
Nightstar Therapeutics initiated at UBS
Nightstar Therapeutics initiated with a Buy at UBS. UBS analyst Carter Gould initiated Nightstar Therapeutics with a Buy rating and $21 price target.
KalVista expects KVD900 Phase 2 HAE trial data in 2019
KalVista Pharmaceuticals provided a development update on its oral plasma kallikrein inhibitor portfolio. “In December we filed with regulatory authorities to begin our Phase 2 study of KVD900 as a potential oral acute treatment for hereditary angioedema, or HAE. As previously announced, this enlarged study is expected to provide data in late 2019. We continue to be excited by the potential for KVD900 to provide a safe, oral on-demand option for HAE patients to more conveniently and effectively manage their disease,” said CEO Andrew Crockett. “We are also pleased to announce that we made the regulatory filings for our next oral plasma kallikrein inhibitor, KVD824, and expect to begin dosing that first-in-human trial soon. We expect to provide a further update on KVD824 around mid-year.” Following the necessary regulatory approvals, the Phase 2 trial evaluating KVD900 as an on-demand treatment for HAE attacks will begin dosing in approximately 50 patients at over 10 European clinical sites. The study will recruit type 1 and 2 HAE patients who have had three attacks in 90 days prior to enrollment. During the first part of this two-part study patients will receive a single 600 mg dose of KVD900 to explore pharmacokinetic and pharmacodynamic properties. All patients will then enter part two of the study, which is a crossover investigation in which the efficacy of KVD900 will be assessed versus placebo across two attacks. Patients experiencing an attack will take a single dose of 600 mg of KVD900 or placebo within one hour of the start of the attack. The second attack will be dosed with the other treatment. For all attacks, symptom severity will be monitored and additional data points will be collected for at least 24 hours. Patients will use their normal, on-demand treatment as required.
Biogen, C4T to develop potential treatments for neurological conditions
Biogen and C4 Therapeutics, or C4T, announced that they have entered into a strategic collaboration to investigate the use of C4T’s novel protein degradation platform to discover and develop potential new treatments for neurological conditions, such as Alzheimer’s disease and Parkinson’s disease. Under the agreement, C4T will provide expertise and research services in targeted protein degradation and Biogen will provide neuroscience expertise and drug development capabilities. Biogen and C4T will research potential targets together and Biogen will advance candidates for development and potential commercialization. Biogen will pay C4T up to a total of $415M in upfront and potential future milestone payments plus potential future royalties. Biogen expects to record a research and development expense of $15M-$25M in Q4.
Biogen, Skyhawk in collaboration for neurological disease treatment
Biogen, Skyhawk enter strategic collaboration for neurological disease treatment Biogen and Therapeutics announced a strategic collaboration in which the companies will leverage Skyhawk’s SkySTAR technology platform with the goal of discovering innovative small molecule treatments for patients with neurological diseases. Biogen will have the option to license therapies resulting from the collaboration and will be responsible for their development and potential commercialization. The agreement grants Biogen an exclusive license to worldwide intellectual property rights on research-stage therapeutic candidates for the treatment of multiple sclerosis, spinal muscular atrophy and additional neurological disorders. As part of the agreement, Skyhawk received an upfront payment of $74M from Biogen and may receive potential future milestone payments and royalties. A portion of the upfront payment will be allocated to future research services, with the remainder expensed in Q1 as research and development.
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