Applied DNA Sciences has acquired Spindle Biotech, an early-stage biotech company specializing in RNA manufacturing technologies. The acquisition combines Applied DNA’s LinearDNA platform with Spindle’s proprietary RNA polymerase, creating an integrated offering called the LineaIVT platform. This platform aims to address challenges in mRNA production by preventing double-stranded RNA contamination, reducing manufacturing complexities, and delivering templates in a shorter timeframe. The acquisition expands Applied DNA’s access to the mRNA value chain and is expected to improve mRNA manufacturing efficiency and quality control.
Applied DNA Sciences, Inc. (NASDAQ:APDN) (“Applied DNA” or the “Company”), a leader in PCR-based DNA technologies, today announced that it has acquired Spindle Biotech Inc. (“Spindle”), an early-stage, private biotech company developing next-generation RNA manufacturing technologies. The acquisition uniquely leverages the Company’s LinearDNA™ platform that enables the efficient chemical modification of DNA templates and the high binding affinity of Spindle’s proprietary, high-performance RNA polymerase (RNAP) for chemically modified DNA templates to deliver multiple advantages over conventional plasmid DNA-based mRNA production, including 1) the prevention or reduction of double-stranded RNA (dsRNA) contamination resulting in higher target mRNA yields; 2) delivery of IVT templates in as little as 14 days for milligram scale and 30 days for gram scale; and 3) reduced mRNA manufacturing complexities.
The acquisition combines the Company’s linearDNA™ IVT templates and Spindle’s RNA polymerase into an integrated offering branded as the LineaIVT™ platform. With this integrated offering, Applied DNA expands its access to the mRNA value chain severalfold to what it estimates is over 20%1 of mRNA manufacturing costs of goods.
Terms of the Stock Purchase Agreement
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Under the terms of the stock purchase agreement entered into among Applied DNA, Spindle, and the former shareholders of Spindle, Applied DNA acquired all outstanding shares in Toronto-based Spindle for an upfront purchase consideration of $625,000 cash, as adjusted for debt and transaction expenses, and 750,000 restricted shares of Company common stock, in addition to future contingent consideration of up to 1.0 million shares of Company common stock upon the satisfaction of certain commercialization and revenue milestones. The SPA also provides for a 10-year revenue share based on the net sales generated by the LineaIVT platform. Aaron Chung, co-founder and CEO of Spindle, joins the Company as Director of Nucleic Acid Platforms.
Dr. James A. Hayward, president and CEO of Applied DNA, stated, “The acquisition of Spindle aligns us with the growing demand for mRNA therapeutics across an expanding range of diseases. mRNA supply, however, is challenged by the industry’s use of plasmid DNA and inherent limitations associated with conventional production methods for mRNA. Chief among these limitations is the generation of potentially hazardous dsRNA contaminants that is a significant challenge to quality control for CDMOs and therapy developers that can potentially delay development timelines and program costs and complicate regulatory approval processes. The issue of dsRNA is currently addressed through additional purification, specialized instrumentation, and cost, however, with the launch of our LineaIVT platform, we seek to solve these manufacturing issues and enable our customers to produce better mRNA faster.
“Having first partnered with Spindle in 2022, we deeply appreciate the complementary nature of its RNAP to our linearDNA IVT templates and the combined technologies’ ability to substantially reduce or eliminate dsRNA contamination without sacrificing production yields,” concluded Dr. Hayward. “With this acquisition, we have moved into a unique leadership position based on our combined offering, which we believe is the only platform to leverage the unique attributes of enzymatically produced IVT templates to empower a proprietary RNA polymerase. With the simultaneous launch of our LineaIVT platform early access program, we plan to engage mRNA stakeholders across the entirety of the value chain.”
Additional Transaction Details
The transaction is being accounted for as an asset acquisition. Applied DNA will record the assets acquired and the consideration paid in its fiscal fourth quarter and full-year 2023 results ending September 30, 2023. A copy of the stock purchase agreement will be filed with the Securities and Exchange Commission (“SEC”) and will be publicly available.
Source: BioSpace
