Calliditas Agrees to Acquire Controlling Interest in Genkyotex
August 13, 2020
Rare Daily Staff
Calliditas Therapeutics said it has reached an agreement to acquire a controlling interest in Genkyotex, a developer of therapies to treat rare fibrotic diseases.
Genkyotex’s lead clinical candidate, setanaxib, is in development to treat primary biliary cholangitis, a chronic rare disease resulting from progressive destruction of the bile ducts in the liver.
In a phase 2 clinical trial, setanaxib demonstrated evidence of anti-fibrotic activity combined with a favorable tolerability profile, as well as a statistically significant impact on fatigue.
In April 2020, Genkyotex completed an end of phase 2 meeting with the U.S. Food and Drug Administration and in June 2020 obtained scientific advice from the European Medicine Agency’s Scientific Advice Working Party that provided a path forward for the late stage development and potential registration of setanaxib in PBC.
“We believe this transaction represents an exciting expansion of our pipeline in orphan diseases related to inflammation and fibrosis,” said Calliditas’ CEO Renée Aguiar-Lucander. “We believe Genkyotex’s novel NOX inhibition technology may have broad clinical utility not just in PBC, but as a platform therapy with the potential to target other fibrotic indications, including primary sclerosing cholangitis (PSC), selected kidney diseases, and idiopathic pulmonary fibrosis (IPF), in which an investigator led phase 2 trial is expected to start recruitment later this year.”
Calliditas has agreed to acquire 7.2 million ordinary shares of Genkyotex representing 62.7 percent of the share capital and voting rights of Genkyotex from the company’s largest shareholders and management team through an off-market block trade for $24 million (€20.3 million) payable in cash at closing. That represents $3.30 (€2.80) per ordinary share, a 25 percent premium over Genkyotex’s volume weighted average price over the preceding month immediately prior to the announcement.
In addition, the sellers will get non-transferable contingent rights to receive additional cash payments on confirmation of regulatory approvals or marketing authorizations of setanaxib worth up to an additional $64.9 million (€55 million).
The off-market block trade is expected to close in early October 2020 and remains subject to customary conditions precedent, including the clearance from the French Minister of Economy and Finance regarding foreign investments into France. Calliditas will finance the block trade from its cash reserves.
Calliditas is seeking to acquire all outstanding Genkyotex shares soon, subject to completion of the off-market block trade, in compliance with French and Belgian securities law. The company said it will file a cash tender offer for the remaining Genkyotex shares on the same terms as the block trade with the French Financial Market Authority.
The Genkyotex shareholders who tender their shares in the centralized tender offer will also be eligible for additional cash payments for certain regulatory approvals of setanaxib worth up to $64.9 million (€55 million).
Photo: Calliditas’ CEO Renée Aguiar-Lucander
Sign up for updates straight to your inbox.