OvaScienceSM and privately-held Millendo Therapeutics, Inc., a clinical-stage biopharmaceutical company focused on developing novel treatments for orphan endocrine diseases, today announced that the companies have updated the terms of their merger agreement and increased the size of the associated financing, strengthening the position of the combined company.
Great Point Partners has joined the previously-disclosed investor syndicate, which includes New Enterprise Associates, Frazier Healthcare Partners, and Roche Venture Fund, among others, bringing the total expected proceeds of the financing to approximately $50 million in the combined company, at the same valuation as the merger. Together with the approximately $37 million in net cash expected from OvaScience at closing, the total proceeds of the merger and financing are expected to be approximately $87 million. The proceeds will fund the further development of Millendo’s lead assets, livoletide and nevanimibe. The financing and merger are expected to close in the fourth quarter of 2018.
“We are pleased to welcome this syndicate of high-quality investors, while ensuring that we have the resources in place to advance our first-in-class programs for the treatment of orphan endocrine diseases,” said Julia Owens, Ph.D., President and Chief Executive Officer of Millendo. “We look forward to providing an update on our clinical progress, beginning with the initiation of our pivotal Phase 2b/3 study of livoletide in Prader-Willi syndrome, in the first quarter of 2019.”
“We believe that with these updated terms and additional funding from recognized investors, the merger of OvaScience and Millendo has the potential to deliver even more significant and immediate value to shareholders and ultimately, to patients,” said Christopher Kroeger, M.D., Chief Executive Officer of OvaScience.
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Updates to the Proposed Transaction
In conjunction with the additional investment by Great Point Partners, the estimated exchange ratio in the merger agreement has been revised, giving OvaScience securityholders greater ownership of the combined company – now with a post-money valuation of approximately $246 million – than pursuant to the former exchange ratio. On a pro forma basis, current OvaScience securityholders will own approximately 17% of the combined company, current Millendo securityholders will own approximately 63% of the combined company, and investors participating in the financing will acquire approximately 20% of the combined company, in each case excluding the available OvaScience option pool and certain out-of-the-money options and subject to adjustment based on OvaScience’s anticipated net cash balance at the time of closing. The proposed transaction has been approved by the boards of directors of both companies and is expected to close in the fourth quarter of 2018, subject to the approval of OvaScience shareholders at a special shareholder meeting on December 4, 2018, as well as other customary conditions. The financing with Great Point Partners depends on a separate registration statement being declared effective unless such condition is waived.
Ladenburg Thalmann & Co. Inc. is acting as financial advisor to OvaScience for the transaction and Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. is serving as legal counsel to OvaScience. Cooley LLP is serving as legal counsel to Millendo. Jefferies and Leerink Partners are acting as Joint Placement Agents for the financing.
Date: November 5, 2018
Source: Yahoo Finance