RALEIGH — Innovate Biopharmaceuticals, a clinical stage biotechnology company focused on developing novel therapeutics for autoimmune and inflammatory diseases based out of the Oak City, is merging with Israeli-based RDD Pharma, a startup focused on orphan and innovative therapies for gastrointestinal disorders.
The result: a new gastroenterology-focused company called 9 Meters Biopharma (which is the approximate length of digestive tract) that will focus on specialty, rare and orphan diseases, it was announced today.
The two companies entered into a definitive merger agreement in which Innovate agreed to acquire all of the outstanding capital stock of privately-held RDD in exchange for a combination of common and preferred shares.
“People living with gastrointestinal (GI) diseases, such as celiac disease, are waiting for treatment options,” Dr. Nissim Darvish, a member of the board of directors of RDD and Senior Managing Director of OrbiMed Advisors LLC, a lead investor in the transaction, said in a release.
“The proposed merger will create a powerful platform company with a pipeline of late development-stage therapeutic candidates already demonstrating proof of concept. We are excited about our investment and future involvement in this new company and the opportunities it presents.”
The combined company will focus on developing urgently needed treatments for specialty, rare and orphan patient populations with GI diseases.
“With a diversified pipeline of novel compounds, active clinical studies – including the first-ever drug to enter a Phase 3 registration trial in celiac disease – 9 Meters Biopharma expects to deliver multiple value creating milestones over the next 24 months,” John Temperato, the current CEO of RDD, who will become the CEO of 9 Meters Biopharma.
Temperato was one of the key players in the buildout of Salix Pharmaceuticals for more than a decade, which culminated in Salix’s acquisition for around $16 billion in 2015.
“The merger of Innovate and RDD to create 9 Meters Biopharma represents a bold new chapter in drug development for GI diseases and is a transformative deal for Innovate shareholders with tremendous benefits. The merger attracts a highly seasoned board and management team led by a proven CEO, fundamentally driven healthcare-dedicated institutional investors and a shared vision to build a truly world-class platform biopharmaceutical company, which can be the partner of choice for near-term business development opportunities as well, jumpstarted with an exciting clinical pipeline,” Dr. Sandeep Laumas, executive chairman of Innovate, said in a statement.
Backed by $21M from investors, Raleigh-based Innovate Biopharmaceuticals becomes public company
