PledPharma has entered into an agreement to acquire all outstanding shares in Rare Thyroid Therapeutics International.
The purchase price for the shares in RTT consists of a cash purchase price in the amount of 60 MSEK, funded from own cash-in-hand, which will be paid on closing and a share purchase price consisting of 63,773,345 new shares in PledPharma. In addition, the sellers of RTT are entitled to earnout payments based on the future net sales of Emcitate as well an earnout which is payable in connection with a potential sale of a so-called US Rare Pediatric Disease Priority Review Voucher.
The Board of Directors in PledPharma has resolved, subject to the general meeting’s subsequent approval, on an issue of 63,773,345 shares to the current shareholders off RTT against payment in kind in the form of shares in RTT. The Board of Directors has further resolved, subject to the general meeting’s subsequent approval, on a fully guaranteed share issue with preferential rights for existing shareholders in the amount of approx. 200 MSEK and to propose that the general meeting authorizes the Board of Directors to resolve on an over-allotment option in the amount of approx. 50 MSEK, please refer to a separate press release for more information. The Transaction is conditioned on that the general meeting approves the Board of Directors’ resolutions regarding the rights issue and the in-kind issue. The Transaction is expected to be completed in early November 2020 provided that the condition described above has been fulfilled. The company has the intention to change its name to Egetis Therapeutics AB.
Rare Thyroid Therapeutics
RTT is a privately held clinical stage research and development company, based in Stockholm, Sweden, specialized in therapies for rare thyroid hormone signaling disorders, a disease area where there is a significant unmet medical need. MCT8 deficiency is a rare congenital disorder of thyroid hormone trafficking with detrimental natural history and no therapy is currently available. Approximately 1 of 70,000 males are affected. A successful Phase IIb trial with the drug candidate Emcitate addressing MCT8 deficiency has been completed. A Phase IIb/III early intervention trial in very young patients is planned to start Q4 2020. Interim results are planned to be available in 2022 and are expected to pave the way for regulatory approvals and commercial launch. Emcitate has been granted Orphan Drug Designation in both EU and the US.
“The acquisition of RTT is an important step, building a new company with a strategic focus on the attractive orphan drug segment, with Aladote and Emcitate as the company’s key assets in late stage development. The RTT team, specialized in orphan drugs, will complement PledPharma’ s late stage development focused organization, building a new orphan drug company named Egetis Therapeutics, dedicated to development and commercialisation of therapies for rare diseases,” said Nicklas Westerholm, CEO, PledPharma. “I look forward to working with the dedicated and competent RTT team with their proven track record from the orphan drug segment, including companies such as Sobi, Wilson Therapeutics and Medical Need Europe”
“Emcitate and RTT’s capabilities and expertise within orphan drugs fit well with the new strategy of PledPharma. The merger allows us to build a stronger combined company, dedicated to development of therapies for rare diseases. By joining forces, we will be able to run multiple programs that create critical mass, generate synergies and improve operational effectiveness”, said Peder Walberg, Founder and CEO, Rare Thyroid Therapeutics. “Ultimately, we believe this will also benefit patients with MCT8 deficiency, who today remain without therapeutic options, and for which Emcitate holds promise to become the first approved therapy”.
This acquisition clearly defines its strategic focus
PledPharma’s lead drug candidate Aladote is developed to reduce the risk of acute liver injury associated with paracetamol poisoning. A proof of principle study has been successfully completed and the design of a Phase II/III study for US/EU regulatory submission is being finalized through ongoing regulatory interactions. Aladote has been granted Orphan Drug Designation in the US. The phase III POLAR program for the company’s second drug candidate PledOx was prematurely stopped in Q2 2020. Results from POLAR program will determine if further development of PledOx is warranted via strategic partnerships and is expected to be announced in Q4 2020.
Through the acquisition, PledPharma clearly defines its strategic focus, creating a company focused on the development and commercialization of late-stage orphan drugs. The acquisition will generate synergies for, and improved operational efficiency in, the development and commercialization of PledPharma’s orphan drug candidate Aladote. The company intends to launch Emcitate and Aladote with internal resources in the EU and the US within approximately 3 years, through a small, resource-efficient, niche commercial organization.
RTT has three employees including the Founder and CEO, Peder Walberg. During 2019 net sales amounted to 4 MSEK and was mainly driven by named patient basis sales. Cash flow from operating activities amounted to -19 MSEK. Result after financial net and result after tax amounted to – 15 MSEK. The cash flow from operating activities and the result was primarily driven by costs from the development of Emcitate.
Photo of Nicklas Westerholm, CEO, PledPharma