Melinta grows pipeline through reverse merger with Cempra
- Melinta Therapeutics Inc. is headed to the Nasdaq stock exchange armed with a souped-up pipeline courtesy of a reverse merger with a struggling anti-infectives drugmaker.
- The all-stock deal combines Melinta with a subsidiary of publicly traded Cempra Inc. The pharmas expect the merger to close in the fourth quarter, and will split ownership of the new company 52%-48%, respectively.
- Melinta and Cempra each get four picks for the new company's nine-member board of directors. A joint selection committee will appoint the CEO, who will fill the last director seat. Melinta is also responsible for choosing the board's chairman.
Cempra's had a rough year.
While the drugmaker's lead candidate, solithromycin, notched a clinical victory in non-alcholic steatohepatitis and a positive opinion — albeit just barely — from an advisory panel as a treatment for community-acquired bacterial pneumonia (CABP), regulators remain concerned about its safety profile, particularly in regard to liver toxicity.
In December, the Food and Drug Administration ultimately rejected solithromycin based on those concerns. A few months later, the company pulled its Marketing Authorisation Application for the drug after the European Medicines Agency too posed questions about its safety.
The setbacks beat down Cempra shareholder optimism. The company's shares went from trading roughly $24 apiece last October to around $4 as of early August. But Melinta evidently sees promise in the company's pipeline.
The deal, though billed as a merger, is really Melinta's acquisition of Cempra. That's not only evident from the new company's ownership structure, but also from the fact it will operate under the name Melinta.
Though Cempra and Melinta's boards have already approved the merger, the drugmakers still need a green light from the majority of their individual shareholders. Cempra investors, however, are clearly seeing the agreement as a win; the company's stock opened Wednesday morning at $4.35 per share, a nearly 15% increase from the prior day's close.
Moving forward, the new Melinta will focus on the commercial launch of current Melinta's only marketed product, Baxdela (delafloxacin). The treatment is indicated for adults with acute bacterial skin and skin structure infections (ABSSSI) caused by susceptible bacteria, and is also in early-to-late stage testing for two other illnesses: CABP and complicated urinary tract infections (cUTIs).
Melinta also plans to select clinical candidates from its ESKAPE program, which focuses on a novel class of antibiotics targeting "superbugs" that pose significant risks to patients, in 2018.
Cempra, meanwhile, acknowledged in an Aug. 9 statement it is looking for "non-dilutive funding" to finance a safety trial aimed at addressing the FDA's safety concerns over solithromycin. It's unclear how the reverse merger will affect that search.
In addition to solithromycin, the new Melinta gains Taksta (fusidic acid). Cempra announced early this year results from a Phase 3 study showing more than 87% of ABSSSI patients taking the drug reduced lesion size by at least 20% between 48 hours and 72 hours after starting therapy. The results present a clear path to FDA filing, according to Cempra.
Follow Jacob Bell on Twitter