PhaseBio Plans for Near-Term Sale Through Chapter 11
October 24, 2022
PhaseBio Pharmaceuticals, a drug developer focused cardiovascular and orphan diseases, filed for Chapter 11 bankruptcy and said it will seek authorization to pursue an auction and sale.
In anticipation of this sales process, PhaseBio has entered into a confidential non-binding agreement with a large pharmaceutical company for the sale of its lead product candidate bentracimab, which is in phase 3 studies to reverse the antiplatelet effects of ticagrelor in patients who present with uncontrolled major or life-threatening bleeding or who require urgent surgery or invasive procedure.
The pharmaceutical company would be designated as the stalking horse bidder and would pay PhaseBio cash in the amount of $40 million, and an additional $60 million upon the achievement of certain regulatory milestones with respect to bentracimab, as well as the assumption of certain obligations.
The company has a candidate in clinical development for pulmonary arterial hypertension and preclinical candidate in development for short bowel syndrome and achondroplasia.
“The Board and management team have thoroughly assessed all of our strategic options and believe that this structured process represents the best possible solution for PhaseBio, taking into account our financial needs and the challenges we have encountered while trying to negotiate a path forward with SFJ Pharmaceuticals,” said Jonathan Mow, CEO of PhaseBio. “Since early 2022, we have been engaged in a strategic process to help identify potential third parties interested in advancing the bentracimab program, through which we received several compelling offers for the licensing and/or acquisition of certain commercial rights to bentracimab. Each offer, however, would have required SFJ to waive or revisit certain terms of their co-development agreement, which they were unwilling to do.”
PhaseBio has filed a series of motions with the court seeking to ensure the continuation of normal operations during this process. For this process, PhaseBio has the support of JMB Capital Partners, which has made a financing commitment of $15 million. PhaseBio believes that its commitment from JMB provides it with sufficient liquidity to conduct its business in an uninterrupted manner, fund its Chapter 11 proceedings, including the sale of its assets, and to continue to meet its operational and financial obligations.
Author: Rare Daily Staff
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