- Tang Capital Partners, which owns just over 10% of Jounce Therapeutics, has made a bid to buy the rest, weeks after the faltering biotech announced plans to combine with another company.
- In February, Jounce said it would enter a reverse merger with U.K.-based Redx Pharma. The transaction would leave Jounce shareholders owning about 37% of the new company and holding a contingent value right, or CVR, that would pay 80% of proceeds from any sales or licensing deals of certain Jounce assets within a year.
- Tang is offering shareholders $1.80 a share in cash plus an identical CVR through a company it controls called Concentra Biosciences. “The management of Concentra has the expertise and resources” needed to maximize the value of the CVR and wind down clinical studies while protecting patients, CEO Kevin Tang said in a letter to Jounce’s board Tuesday.
A series of clinical setbacks tied the hands of Jounce’s board, which concluded last month that the company can no longer continue to develop its experimental cancer immunotherapies alone. Late on Feb. 22, Jounce said it would lay off more than half its workforce. Hours later, it announced the combination with Redx.
News of Tang’s offer sent Jounce’s stock soaring 44% in early trading Wednesday. Tang gave Jounce’s board until 5 p.m. on March 17 to respond to his offer before it expired.
“The board is committed to acting in the best interests of all shareholders,” Jounce said in a statement Tuesday. “A further announcement will be made in due course.”
Jounce’s most advanced programs are JTX-8064, designed to activate macrophages against immune-suppressive tumors, and vopratelimab, which failed in a Phase 2 trial in lung cancer last year. The company’s hopes for the future had long been pinned to vopratelimab, which was at the center of a major deal with Celgene in 2016.
Last month, Jounce’s directors told shareholders they believed the best way forward was to join forces with Redx, creating a larger company focused on cancer and fibrotic disease. The companies said they expected to complete their transaction in the second quarter.