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Disc Medicine Enters Reverse Merges with Gemini Therapeutics for Public Listing

August 11, 2022

With biotech IPOs virtually non-existent, privately held Disc Medicine has chosen to go public by reverse merging with publicly held Gemini Therapeutics in an all-stock transaction.

Photo: John Quisel, president and CEO of Disc Medicine

The combined company will focus on advancing Disc’s pipeline of hematology programs, including multiple patient studies for its clinical-stage programs bitopertin for erythropoietic porphyrias and DISC-0974 for anemia of myelofibrosis and anemia of chronic kidney disease.

Upon shareholder approval, the combined company is expected to operate under the name Disc Medicine, Inc. and trade on the Nasdaq Global Market under the ticker symbol IRON. Disc shareholders will own 72 percent of the company, while existing Gemini stockholders will hold the remaining 28 percent. Following the merger, the combined company will be led by John Quisel, the current CEO and president of Disc Medicine, and other members of the Disc management team.

Supporting the merger, Disc has secured commitments from a syndicate of healthcare investors led by Access Biotechnology and including OrbiMed, Atlas Venture, 5AM Ventures, Novo Holdings A/S, Arix Bioscience, Rock Springs Capital, and Janus Henderson Investors, for a $53.5 million financing that is expected to close concurrent with the completion of the merger. With the cash expected from both companies at closing and the proceeds of the concurrent financing, the combined company is currently expected to have approximately $175 million of cash or cash equivalents. The cash resources will be used to advance Disc’s pipeline through multiple clinical studies and provide runway into 2025. The merger and related financing are expected to close in the fourth quarter of 2022.

“This merger with Gemini comes at a pivotal moment for our company. In the last few months, we have initiated clinical studies in patients for both bitopertin and DISC-0974 and presented first-in-human data from DISC-0974, our hepcidin suppression program, establishing clinical proof-of-mechanism,” said John Quisel, CEO and president of Disc Medicine. “This transaction will provide us with tremendous financial strength, propel several programs through a series of data catalysts and enable us to explore the full potential of our pipeline.”

Disc has a clinical-stage development pipeline composed of investigational product candidates that affect heme biosynthesis and iron metabolism and are designed to target pathways with established, clinically validated biology with the potential to address multiple indications.

Disc’s lead experimental therapy bitopertin is an inhibitor of glycine transporter, GlyT1, and has demonstrated effects on heme biosynthesis in clinical studies. Bitopertin was in-licensed by Disc from Roche in 2021 and has been extensively studied, including a safety data package reflecting clinical experience in more than 4,000 individuals. Inhibition of heme biosynthesis has the potential to address a wide range of hematologic disorders. Disc has initiated BEACON, an open-label, phase 2 trial of bitopertin in patients with erythropoietic porphyria, a rare, debilitating and potentially fatal genetic disorder that results in dysregulated heme biosynthesis and where bitopertin has the potential to become the first disease-modifying treatment. Additional clinical studies in Diamond-Blackfan Anemia (DBA) and other indications are being planned.

DISC-0974 is a monoclonal antibody targeting a co-receptor called hemojuvelin (HJV) and is designed to suppress hepcidin production and increase serum iron levels in patients suffering from the anemia of inflammation. DISC-0974 was in-licensed by Disc from AbbVie in 2019. Anemia of inflammation arises from abnormally elevated hepcidin and is the most common form of anemia, affecting millions of patients across numerous diseases such as chronic kidney disease, myelofibrosis, cancer, autoimmune diseases, and other conditions with an inflammatory component. Disc has established clinical proof-of-mechanism of DISC-0974 in a phase 1 study of healthy volunteers and initiated a phase 1b/2 clinical study of DISC-0974 in patients with anemia of myelofibrosis. Disc plans to initiate a phase 1b/2 clinical study of DISC-0974 in patients with anemia of chronic kidney disease (non-dialysis) in late 2022.

Disc also has a research program designed to identify orally available, small molecules to inhibit Matriptase-2 and increase the production of hepcidin and restrict iron availability. The therapeutic role of hepcidin has been established in patients with polycythemia vera and hereditary hemochromatosis, and is being studied for the treatment of diseases associated with iron overload, including beta-thalassemia, myelodysplastic syndromes, and sickle cell disease.

Pre-merger Gemini shareholders are expected to own approximately 28 percent of the combined company and pre-merger Disc shareholders are expected to own approximately 72 percent of the combined company, in each case before giving effect to the concurrent financing. The percentage of the combined company that Gemini’s shareholders will own as of the close of the transaction is subject to adjustment based on the amount of Gemini’s net cash at the closing date. Immediately prior to the closing of the proposed merger, Gemini stockholders will be issued contingent value rights representing the right to receive certain payments from proceeds received by the combined company, if any, related to pre-transaction legacy assets during the period ending one year following the closing of the merger.

Author: Rare Daily Staff

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