First Wave BioPharma Announces Completion of Business Combination with ImmunogenX, Adding Phase 3-Ready Latiglutenase to its Late-Stage GI-Focused Clinical Pipeline
First Wave BioPharma, Inc. announces the acquisition of ImmunogenX, focusing on advancing a GI pipeline with a potentially first-in-class oral biotherapeutic for celiac disease. The company plans to license the commercial rights to a global pharmaceutical company, secure financing, and initiate Phase 3 trials in 2025.
Positive
First Wave BioPharma acquires ImmunogenX in an all-stock transaction to advance a GI pipeline.
Latiglutenase, a potentially first-in-class oral biotherapeutic for celiac disease, is a near Phase 3-ready asset.
James Sapirstein remains Chairman and CEO, with Jack Syage named President and COO.
A strategic U.S. commercial license agreement and institutional investment are expected in 2H’24.
Latiglutenase has shown effectiveness in reducing intestinal damage and celiac disease symptoms in Phase 2 trials.
Phase 3 trials for latiglutenase are planned to commence in early 2025.
First Wave BioPharma aims to become a leading developer of targeted therapeutics for GI diseases.
The company's product portfolio includes other promising assets like capeserod and adrulipase.
The acquisition deal includes issuance of common stock and Series G Convertible Preferred Stock.
The combined fully diluted equity value of the deal is $104 million.
Tungsten Advisors acted as the exclusive financial advisor to First Wave BioPharma.
The acquisition of ImmunogenX by First Wave BioPharma is a strategic move that significantly bolsters the company's pipeline with the addition of latiglutenase, a promising treatment for celiac disease. This transaction, notably an all-stock deal, dilutes current shareholders but potentially adds significant value with a near Phase 3-ready asset. The potential U.S. and Canada licensing agreement with a global pharmaceutical company, alongside the planned institutional investment, could provide non-dilutive financing, which is favorable for existing shareholders as it avoids further dilution of equity.
The projected fully diluted equity value of $104 million post-acquisition indicates a substantial valuation for a biopharmaceutical company of this scale. However, it is crucial to monitor the contingent nature of the strategic licensing agreement and financing, which hinges on several conditions including due diligence and regulatory approvals. The impact on the company's stock price will be closely tied to the progress of these negotiations and the eventual market reception of latiglutenase, should it gain FDA approval.
Latiglutenase's progression to a Phase 3 clinical trial is a critical milestone, as celiac disease currently lacks FDA-approved pharmacologic treatments. The therapy's dual protease composition targets the degradation of gluten proteins, which could revolutionize treatment protocols. The positive outcomes from the Phase 2 trials, involving approximately 200 patients, suggest a favorable safety profile and efficacy in mitigating intestinal damage and symptoms associated with celiac disease.
The involvement of the NIH in grant funding and FDA encouragement speaks to the therapeutic's potential and scientific backing. However, the success of latiglutenase will ultimately depend on Phase 3 trial results, manufacturing scalability and market penetration strategies post-approval. The long-term impact on First Wave BioPharma will be dictated by the drug's clinical success and its ability to capture market share in the multi-billion-dollar GI market.
First Wave BioPharma's strategic positioning in the GI market, particularly with latiglutenase, taps into a significant unmet medical need in the treatment of celiac disease. The company's broader pipeline, including capeserod and adrulipase, diversifies its portfolio, which may appeal to investors seeking companies with multiple assets in development. The in-licensing agreement with Sanofi for capeserod also suggests a proactive approach to portfolio expansion.
Given the absence of approved pharmacological treatments for celiac disease, latiglutenase has the potential to capture a first-mover advantage. However, the market impact will depend on the competitive landscape, pricing, reimbursement scenarios and patient and physician adoption rates. The company's stock market performance will be influenced by investor perception of the drug's commercial viability and the execution of the company's strategic initiatives.
03/14/2024 - 06:00 AM
Latiglutenase is a potentially first-in-class oral biotherapeutic for the treatment of celiac disease
James Sapirstein, Chairman and Chief Executive Officer, to continue leading First Wave BioPharma; Jack Syage, Ph.D., named President and Chief Operating Officer
A strategic U.S. commercial license agreement with a global pharmaceutical company and concurrent institutional investment expected to close in 2H’24
Conference Call Scheduled for Today at 8:30 a.m. ET
BOCA RATON, Fla., March 14, 2024 (GLOBE NEWSWIRE) -- First Wave BioPharma, Inc., (NASDAQ: FWBI), (“First Wave BioPharma” or the “Company”), a clinical-stage biopharmaceutical company specializing in the development of targeted, non-systemic therapies for gastrointestinal (GI) diseases, today announced it has acquired ImmunogenX in an all-stock transaction with the combined company focused on advancing a GI pipeline comprised of multiple, late-stage clinical assets, including latiglutenase, a potentially first-in-class, near Phase 3-ready, targeted, oral biotherapeutic for celiac disease. James Sapirstein will continue to serve as Chairman and Chief Executive Officer of First Wave BioPharma with Jack Syage, Ph.D., previously the Chief Executive Officer and Co-Founder of ImmunogenX, assuming the role of President and Chief Operating Officer of First Wave BioPharma. Dr. Syage and Dr. Chaitan Khosla will also join the board of directors of First Wave BioPharma.
First Wave BioPharma intends to license the commercial rights to latiglutenase in the United States and Canada to a strategic global pharmaceutical company which will commercialize latiglutenase following receipt of marketing approval. First Wave BioPharma will also seek to secure financing commitments from a syndicate of institutional healthcare investors to fund the ongoing development of latiglutenase. The closing of a strategic licensing agreement and any other financings would be contingent upon the satisfaction of a number of conditions, including customary due diligence, the negotiation and execution of definitive agreements, Board approval and receipt of all required third-party (including governmental) approvals, licenses, consents, and clearances, as and when applicable.
Latiglutenase, an oral biotherapeutic composed of two gluten-specific recombinant proteases, has demonstrated effectiveness in reducing intestinal damage and alleviating symptoms of celiac disease in two Phase 2 trials involving approximately 200 patients. The Phase 3 clinical plan for latiglutenase has been reviewed by the GI Division of the U.S. Food and Drug Administration (FDA) and the trials are anticipated to begin in early 2025.
“Completion of the acquisition of ImmunogenX and the addition of latiglutenase to our clinical pipeline is a transformative event for First Wave BioPharma as it provides our company with a Phase 3-ready asset in a multibillion-dollar GI market – celiac disease – for which no approved pharmacologic treatment currently exists,” stated Mr. Sapirstein. “Given this enormous potential, we are working with Dr. Syage and his team to advance the regulatory, manufacturing, and clinical processes that would enable the initiation of the pivotal Phase 3 clinical trials of latiglutenase in 2025. To that end, we will seek to develop latiglutenase by completing an agreement with a global pharmaceutical company to provide First Wave with non-dilutive financing in exchange for U.S. and Canadian rights to the drug and to obtain financing with a syndicate of leading institutional healthcare funds in 2H’24. We expect to finalize these agreements prior to initiating preparatory work for the Phase 3 latiglutenase trials.”
Dr. Syage commented: “I am excited to join First Wave BioPharma and advance the company’s mission to become a leading developer of targeted, orally delivered therapeutics for GI diseases. We believe latiglutenase has the potential to transform the treatment of celiac disease with data from two prior Phase 2 trials indicating the therapy is well tolerated and effective in degrading the key gluten proteins responsible for intestinal damage and celiac disease symptoms. This merger with First Wave will provide the support needed to propel the development of latiglutenase, a program that has already received significant NIH grant funding and encouragement from the FDA.”
Mr. Sapirstein concluded: “First Wave BioPharma now possesses a GI-development pipeline unrivaled by other companies of similar size. In addition to latiglutenase, our product portfolio includes capeserod, a selective 5-HT4 receptor partial agonist in-licensed from Sanofi, which is being developed for an anticipated Phase 2 trial in gastroparesis, and Phase 2-ready adrulipase, a recombinant lipase designed to enable the digestion of fats and improve nutritional health in cystic fibrosis patients with exocrine pancreatic insufficiency.”
Upon closing of the acquisition, the Company issued 365,162 shares of its common stock to the shareholders (including option and warrant holders) of ImmunogenX equal to 19.02% of its currently issued and outstanding common stock and 11,777.418 shares of its newly issued Series G Convertible Preferred Stock (with a conversion ratio of Preferred to Common at 1:1000) representing on a fully diluted basis 81.9% for ImmunogenX and 18.1% for First Wave Biopharma (excluding transaction fees) with a combined fully diluted equity value of $104 million . The shares of the Company’s common stock issuable upon conversion of the Series G Preferred Stock shall be subject to stockholder approval in compliance with the rules of the Nasdaq Stock Market.
Tungsten Advisors served as the exclusive financial advisor to First Wave BioPharma.
Conference Call Information:
First Wave BioPharma will host a conference call and live audio webcast today, March 14, 2024, at 8:30 a.m. ET, to discuss the definitive merger agreement with ImmunogenX and provide a strategic outlook for company.
The audio webcast of the conference call will be accessible via the Investors section of the First Wave website: https://www.firstwavebio.com/investors/overview https://edge.media-server.com/mmc/p/caeg5tgz
An archive of the webcast will remain available for 90 days beginning at approximately 10:30 a.m. ET, on March 14, 2024.
Additionally, interested participants and investors may access the conference call telephonically by registering via the following online form:
https://register.vevent.com/register/BI36686d07f85e40b4ad95f761fb3e22d2
Once registered, all individuals will be provided with a participant dial-in number, a passcode, and a registrant ID, which can then be used to access the conference call.
About Latiglutenase
About Celiac Disease 1% of the population worldwide and is increasing in prevalence with improved diagnostic tools and improved awareness.
About First Wave BioPharma, Inc. www.firstwavebio.com
About Tungsten Advisors
Securities offered through Finalis Securities LLC Member FINRA/SIPC. Tungsten Partners LLC d/b/a Tungsten Advisors and Finalis Securities LLC are separate, unaffiliated entities.
Forward-Looking Statements This press release may contain certain statements relating to future results which are forward-looking statements. It is possible that the Company’s actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements, depending on factors including whether any financing or licensing transaction may be completed with different terms, in an untimely manner, or not at all; whether the Company will be able to realize the benefits of the completed transaction described herein; the Company’s ability to integrate the assets and commercial operations contemplated acquired from ImmunogenX into the Company’s business; whether results obtained in preclinical and nonclinical studies and clinical trials will be indicative of results obtained in future clinical trials; whether preliminary or interim results from a clinical trial will be indicative of the final results of the trial; whether the Company will be able to maintain compliance with Nasdaq’s continued listing criteria and the effect of a delisting from Nasdaq on the market for the Company’s securities; the size of the potential markets for the Company’s drug candidates and its ability to service those markets; the effects of the First Wave Bio, Inc. acquisition, the related settlement and their effect on the Company’s business, operating results and financial prospects; and the Company’s current and future capital requirements and its ability to raise additional funds to satisfy its capital needs. Additional information concerning the Company and its business, including a discussion of factors that could materially affect the Company’s financial results are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, under the heading “Risk Factors,” as well as the Company’s subsequent filings with the Securities and Exchange Commission. All forward-looking statements included in this press release are made only as of the date of this press release, and we do not undertake any obligation to publicly update or correct any forward-looking statements to reflect events or circumstances that subsequently occur or of which we hereafter become aware.
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What is the potentially first-in-class oral biotherapeutic for celiac disease developed by First Wave BioPharma?
The potentially first-in-class oral biotherapeutic for celiac disease developed by First Wave BioPharma is latiglutenase.
Who will continue to lead First Wave BioPharma as Chairman and Chief Executive Officer?
James Sapirstein will continue to lead First Wave BioPharma as Chairman and Chief Executive Officer.
What role will Jack Syage, Ph.D., assume in First Wave BioPharma?
Jack Syage, Ph.D., will assume the role of President and Chief Operating Officer at First Wave BioPharma.
What type of agreement does First Wave BioPharma intend to secure for the commercial rights to latiglutenase in the United States and Canada?
First Wave BioPharma intends to secure a strategic U.S. commercial license agreement for the rights to latiglutenase in the United States and Canada.
When are the Phase 3 clinical trials for latiglutenase anticipated to begin?
The Phase 3 clinical trials for latiglutenase are anticipated to begin in early 2025.
