RARE Daily

Amicus Reverse Merges with SPAC, Spinning Out its Gene Therapy Business into Caritas Therapeutics

September 29, 2021

Amicus Therapeutics said it will spin out its gene therapy business into a next-generation genetic medicine company, Caritas Therapeutics, through a reverse merger with ARYA Sciences Acquisition Corp IV, a special purpose acquisition company or SPAC, sponsored by Perceptive Advisors.

The transaction will result in two independent publicly traded companies with Amicus becoming the largest shareholder in Caritas with an approximately 36 percent ownership stake (assuming no redemptions by ARYA’s shareholders) and retaining co-development and commercialization rights to the Fabry and Pompe gene therapy programs including a 50/50 cost and profit share, as well as negotiation rights on select future muscular dystrophy programs.

Together, Caritas is expected to receive proceeds of approximately $400 million at the closing of the transactions, assuming no redemptions are made, including approximately $150 million held in the ARYA SPAC, $200 million in a concurrent private investment from a group of healthcare biotechnology investors, and $50 million in a cash investment from Amicus in exchange for additional equity.

Proceeds of the business combination and the PIPE are expected to be used to advance development of the Caritas gene therapy pipeline, discovery work, growth across its scientific teams and to support general corporate activities (including payment of certain transaction expenses). Amicus also expects to use the net proceeds to further fund initiatives in the global commercialization of Galafold and the anticipated global launch of AT-GAA.

Caritas will trade on the Nasdaq Global Market under the ticker symbol “SPES.” A condition to closing of the business combination transaction is that these cash proceeds are no less than $300 million in total.

Upon closing of the deal, current Amicus Chairman and CEO John Crowley will lead Caritas as chairman and CEO and will become the chairman emeritus and chief strategic advisor for Amicus. Current Amicus President and Chief Operating Officer Bradley Campbell will be named as CEO of Amicus.

“This is a big, bold vision and a massive step forward for next generation biotechnologies for people worldwide living with some of the most devastating rare diseases,” said Crowley. “In a single stroke with the formation and funding of Caritas we will create what will be one of the world’s preeminent next-generation genetic medicines companies. We strongly believe that separating our business into two highly focused, stand-alone companies is the best way to unlock significant value for Amicus shareholders and to advance our medicines and technologies to people living with rare diseases around the world.”

Amicus says the deal will transform the company into a premier rare disease global commercialization and late-stage product development company, strengthen its financial profile, and accelerate its path to profitability, while preserving significant equity ownership in the gene therapy pipeline and commercial rights to the innovative and important Fabry and Pompe gene therapy programs.

“We will be laser focused on maintaining the growth of Galafold and executing on the anticipated global launch of AT-GAA, as we build Amicus into a leading global rare disease biotechnology company and bring our medicines to as many patients as quickly as possible,” said Bradley Campbell, president and chief operating officer of Amicus.

Following the transaction, Amicus will remain a global, patient-dedicated biotechnology company developing and delivering novel high-quality medicines for people living with rare diseases. Amicus’ focus will be to grow its leadership position across Amicus’ two lead indications of Fabry disease and Pompe disease. In addition, it is expected the transaction will strengthen the Amicus financial outlook and enable it to achieve profitability in 2023.

Amicus plans to continue investing in the global commercialization of Galafold for Fabry disease through geographic and label expansion, as well as support for diagnostic initiatives. In Pompe disease, Amicus will focus on securing global approvals, executing the anticipated global launch of AT-GAA, and providing access for patients as quickly as possible. Amicus continues to believe that AT-GAA has the potential upon approval to become the next standard of care for all people living with Pompe disease.

Caritas will focus on rare disease discovery and development of next-generation genetic medicines through advanced protein engineering and innovative gene therapy vector technologies. Through its 60-plus bench scientists and experienced development and leadership teams, Caritas will develop and advance a series of novel platform technologies to address the key challenges to the safe and efficient gene transfer necessary for next-generation gene therapies. These include proprietary technologies designed to address delivery, safety, durability, and manufacturability of gene therapies. The gene therapy pipeline is founded on deep expertise and platform technologies in protein engineering and rare disease biology, the broad research collaboration with the Perelman School of Medicine at the University of Pennsylvania for best-in-class gene therapies, and a new co-development collaboration with Amicus.

The pipeline is led by two Batten disease programs with clinical proof of concept in CLN6 and CLN3, six active preclinical programs, including Fabry disease, Pompe disease, and CDKL5 Deficiency Disorder (CDD), as well as multiple discovery programs. Caritas will have exclusive, global rights to gene therapy programs for nearly 50 rare genetic diseases through its broad collaboration with Jim Wilson and the Penn team, including a majority of next-generation lysosomal disease programs as well as 11 more prevalent rare diseases. Among these are Angelman Syndrome, Duchenne Muscular Dystrophy, Rett Syndrome, Myotonic Dystrophy and select other muscular dystrophies. Wilson will become a senior scientific and strategic advisor to Caritas.

Amicus management expects that, as a new, independent entity with approximately 115 employees, Caritas will be better positioned to pursue its strategic priorities, accelerate its programs and discovery work, as well as adequately fund its manufacturing capabilities. Amicus believes that this transaction will harness those opportunities to the benefit of patients and shareholders.

The boards of directors of both Amicus and ARYA IV have approved the proposed transaction. Completion of the transaction, which is expected in the fourth quarter of 2021 or early 2022, is subject to approval of ARYA IV’s shareholders, delivery of the minimum $300 million in cash proceeds, and the satisfaction or waiver of certain other customary closing conditions.

Photo: John Crowley, newly named chairman and CEO Caritas

Author: Rare Daily Staff

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