AcelRx Pharmaceuticals, Inc. (AcelRx) (Nasdaq: ACRX), a specialty pharmaceutical company focused on the development and commercialization of innovative therapies for use in medically supervised settings, today announced the execution of an amendment to its merger agreement to acquire Tetraphase Pharmaceuticals, Inc. (Tetraphase) (NASDAQ: TTPH), with revised consideration of $30.0 million in stock and cash based on the AcelRx closing share price on May 22, 2020, plus an additional $14.5 million in contingent value rights (CVRs) payable in cash.
The total consideration payable to Tetraphase stockholders and warrant holders includes AcelRx stock valued at $24.6 million, based upon the closing share price of AcelRx stock of $1.52 on May 22, 2020, plus $5.4 million in cash.
Tetraphase stockholders will receive, for each share of Tetraphase common stock, (1) $0.2434 in cash and 0.7217 shares of AcelRx common stock, representing approximately $1.34 in upfront per share value, based upon the closing share price of AcelRx stock of $1.52 on May 22, 2020, and (2) one CVR, which would entitle the Tetraphase stockholders to receive potential aggregate payments of up to $14.5 million in cash upon the achievement of certain future XERAVA™ net sales milestones starting in 2021.
Tetraphase’s board of directors has determined that as a result of the amendment to the merger agreement, competing bidders’ proposals were not superior and recommends the merger agreement, as amended, to its stockholders. In addition to delivering overall higher value, the AcelRx agreement delivers a higher per share valuation to Tetraphase warrant holders and stockholders.
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“Our co-promotion agreement with Tetraphase is already proving to be a great step forward for our commercial teams, and we believe significant additional value will be created in the full combination of the companies,” said Vince Angotti, Chief Executive Officer at AcelRx. “This agreement and the expected closing of this merger is a solid first step in executing on our strategy of having multiple products in our portfolio to commercialize within healthcare institutions.”
Under terms of the merger agreement, the transaction is expected to close following the Tetraphase’s stockholder meeting, which is currently set for June 8, 2020. Closing of the transaction is subject to receipt of approval of its stockholders, as well as satisfaction of other customary closing conditions. The transaction does not require a vote by AcelRx stockholders.
Cooley LLP is acting as legal counsel to AcelRx.
Source: BioSpace
