Rocket Pharmaceuticals has landed a Nasdaq listing through a reverse merger. The deal will see the low-profile gene therapy startup merge with floundering Inotek Pharmaceuticals before embarking on a clutch of clinical trials.
Shareholders in Rocket will own 81% of the combined company, leaving the Inotek stockholders who stuck around after back-to-back glaucoma failures with 19%. That stake reflects the value of Inotek’s Nasdaq listing and whatever is left of the $27.6 million in cash it had at the last count.
New York, NY-based Rocket will combine that money with the $25 million it raised from a group of investors including RTW Investments, Cormorant Asset Management and Tavistock Group earlier this year and kick off a multi-front clinical development program. Rocket plans to move into human testing in 2018 and have as many as four trials on the go before the end of the year.
The trials will assess candidates that emerge from Rocket’s research into fanconi anemia, leukocyte adhesion deficiency-1 and pyruvate kinase deficiency. That list of indications reflects Rocket’s focus on genetic bone marrow disorders it thinks can be treated using lentiviral gene therapies. And, in part, it grew out of “gene therapy in a box” research the Fred Hutchinson Cancer Research Center has performed using funding from Rocket, according to an Xconomy report from 2016.
In the longer term, Rocket is working on an adeno-associated virus (AAV) gene therapy platform it thinks will expand the list of diseases it can treat. The AAV program is initially targeting a pediatric disease that affects more than 15,000 patients in the U.S. and Europe. Rocket is tight-lipped about the name of the disease.
Gaurav Shah, M.D., will oversee this work as CEO. Shah spent about five years at Novartis, rising to a global clinical program head post that gave him a role in the CAR-T program before leaving for VC shop RTW. In that capacity, Shah helped set up Rocket.
While Rocket’s story is just getting started, Inotek’s has come to an end. The biotech became a likely target for a reverse merger in July when it posted weak phase 2 results to add to an earlier subpar phase 3 readout. That left Inotek with little of value beyond its cash and Nasdaq listing.
In taking the reverse merger route out of the situation, Inotek has joined an ever-growing list of biotechs that went public during the IPO go-go years only to be reduced to shells by weak clinical trial data.