Maryland biotechs PharmAthene and Novartis-backed Altimmune pen merger deal

The merger sees the two biotechs have a portfolio of four clinical and one preclinical candidates.

NYSE-listed small cap PharmAthene and private infectious disease biotech Altimmune have signed a merger pact that will see the pair become one in an all-stock transaction.

PharmAthene will merge into Altimmune, which lists Novartis Venture Fund, HealthCap, Truffle Capital and Redmont Capital as its investors, to create a new, diversified immunotherapeutics company with four clinical stage and one preclinical stage programs.

These include phase 2-ready NasoVAX, an intranasal, single-dose influenza vaccine, and HepTcell, a first-in-class immunotherapeutic for chronic hep B with “the potential to offer a functional cure,” currently in phase 1.

There is also SparVax-L, billed as a next-gen lyophilized anthrax vaccine (NIAID funded), and NasoShield, an intranasal, single-dose, first-in-class anthrax vaccine that is funded by BARDA. A phase 1 trial is set to start this year, with data coming out halfway through 2018.

The preclinical program, Oncosyn, is in early testing for immuno-oncology indications.

A full financial breakdown was not given, but under the deal Altimmune will become a wholly owned subsidiary of the biotech.

The combined entity will become a public company under the name Altimmune and is slated to trade on the NYSE under the ticker symbol $ALT. The combined biotech has around $20 million in cash and cash commitments.

Bill Enright, CEO of Altimmune, and Elizabeth Czerepak, CFO and EVP of Corporate Development at Altimmune, will serve in their respective positions for the combined company, the two said in a statement.

The combined company's headquarters will be located in Gaithersburg, Maryland.

“A merger with Altimmune is an ideal strategic match,” commented John Gill, president and CEO of PharmAthene in the statement. “It fulfills our stated goal of continuing to build value for PharmAthene shareholders after we distribute the SIGA litigation proceeds on February 3. By combining forces, we will diversify our portfolio into attractive commercial product opportunities and leverage our capabilities for developing next generation anthrax vaccines.”

Enright added: “The merger allows Altimmune to leverage PharmAthene's existing U.S. public company infrastructure, providing access to the capital markets, which is essential to the continued development of immunotherapeutics clinical programs including NasoVAX, NasoShield and HepTCell that leverage Altimmune's proprietary platform technologies.”

PharmAthene currently has a market cap of $223 million and was trading at $3.40 at end of play yesterday.