Bruised Ultragenyx attempts swoop for in-demand Dimension

The bidding war comes amid a series of setbacks for Ultragenyx over the past year.

It looked like a done deal: Last month, Regenxbio penned a pact to acquire Dimension Therapeutics for the modest sum of $86 million as it looked to add two early-stage gene therapies to its pipeline.

But now, battered and bruised by a series of R&D setbacks, Ultragenyx is putting $138 million on the table, in cash ($5.50 a share), as it hopes to wrestle the biotech away from its first suitor.

Its deal is a whopping 358% of Dimension’s unaffected share price as of August 24 and will start a bidding war, though one at the lower end of M&A, among the trio.

“This transaction provides a compelling opportunity to create value by leveraging Ultragenyx’s advanced clinical and regulatory expertise, as well as its rare metabolic disease commercial infrastructure to advance Dimension’s rare disease focused gene therapies and bring much needed new treatments to market,” said Emil D. Kakkis, M.D., Ph.D., CEO and president of Ultragenyx.

“Based on my own experience as a scientific advisor to Dimension, I have the greatest respect for the deep expertise and knowledge of Dimension’s employees in AAV gene 2 therapy and manufacturing. We share Dimension’s vision for bringing transformational new therapies to patients with rare genetic diseases and believe that bringing our two companies together would accelerate the process of bringing important new therapies to market for patients.”

Kakkis continued: “Our all-cash offer provides meaningfully greater value and certainty to Dimension shareholders compared to the proposed all-stock acquisition by Regenxbio. We believe Ultragenyx and its product candidates are highly complementary to Dimension’s and present no competitive overlap, giving us confidence that we could combine our two companies quickly and seamlessly.”

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Rockville, Maryland-based Regenxbio initially swooped on Dimension in late August, but is now battling Ultragenyx for rights to DTX301 and DTX401. DTX301 is the more advanced of the candidates, having already moved into a phase 1/2 trial in patients with late-onset ornithine transcarbamylase deficiency.

The company expects glycogen storage disease type Ia candidate DTX401 to reach the IND stage early next year.

The notable absence from the list of programs about which suitors are excited—and the reason Regenxbio was set to buy Dimension for a knockdown price—is DTX101. That was once Dimension’s top prospect.

However, the release of data from a phase 1/2 trial of the hemophilia B candidate over the first half of the year marked it out as unlikely to succeed, particularly in light of clinical data generated by Spark Therapeutics’ rival gene therapy.

Dimension grew out of Fidelity Biosciences’ belief that gene therapy was ready for the big time. And, having been spawned through an alliance with ReGenX, Dimension quickly pulled in $30 million from Fidelity and OrbiMed, was heralded as having the best AAV technology in the industry, landed a $250 million deal with Bayer, signed up Merck KGaA chief An­nal­isa Jenk­ins as CEO and capped off a busy first year with a Fierce 15 award. An IPO followed late in 2015.

That was about as good as it got for Dimension.

This year, the biotech’s A-list credentials butted up against negative data. The negative data won. Dimension’s market cap went on to slip to $30 million, attracting the interest of Regenxbio and now Ultragenyx.

Today, Dimension’s stock was up nearly 10% premarket, with its market cap at $35 million.