Transcept And Paratek Sign Merger Agreement
Specialty firm Transcept Pharmaceuticals and biopharmaceutical firm Paratek Pharmaceuticals announced that the two companies have signed a merger agreement, that, once completed, will result in a NASDAQ-listed biopharmaceutical company touting a lead antibiotic candidate asset.
Upon closing of the transaction, Paratek will become a wholly owned subsidiary of Transcept. The companies revealed that Transcept has $15 million and Paratek $18 million cash on hand. The combined organization is expected to be capitalized with cash and cash equivalents of between an estimated $108 million and $111 million. An additional estimated $93 million will be invested by the companies’ investor syndicate comprising new investors and certain Transcept and Paratek stakeholders.
Glenn Oclassen, CEO and Chairman of the Transcept Board, said, ”Under the proposed transaction, Transcept's stockholders will maintain a meaningful equity ownership stake in Transcept, which will refocus its operations as a late-stage therapeutics company with product candidates we believe possess significant commercial potential. The transaction also provides for our stockholders an additional special cash dividend and the opportunity to realize any upside potential from our INTERMEZZO and TO-2070 assets.”
Michael Bigham, CEO and Chairman of the Paratek Board of Directors, said that the transaction provides funding for the Phase III development of the company’s lead candidate Omadacycline — a novel tetracycline-derived, broad-spectrum antibiotic under development as a first-line empiric monotherapy. The once-daily oral, intravenous, and broad-spectrum antibiotic is designed against bacterial antibiotic resistance and serious community-acquired infections.
Bigham said, “The combined organization will have the resources to initiate and complete our planned Phase 3 registration program, as agreed with FDA per Special Protocol Assessments, for both Acute Bacterial Skin and Skin Structure Infections (ABSSSI) and Community-acquired Bacterial Pneumonia (CABP). We will also explore additional potential indications including urinary tract infections (UTI).”
The companies stated that the merger is expected to be completed during the second half of 2014.