Roivant catches the SPAC wave to Wall Street in $611M deal

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Roivant will receive up to $411 million from the SPAC, Montes Archimedes Acquisition Corp., as well as $200 million through a private round. (Natalie Murphy)

As Roivant Sciences gears up its “next chapter,” the company is heading for the public markets by merging with a special purpose acquisition company, or SPAC, and raising $611 million in the process. 

Roivant will receive up to $411 million from the SPAC, Montes Archimedes Acquisition Corp., as well as $200 million through a private round from investors including Fidelity Management & Research Company, Eventide Asset Management, Palantir Technologies, Viking Global Investors, SoftBank and Sumitomo Dainippon Pharma. 

The deal is expected to close in the third quarter and the combined company will trade on the Nasdaq under the ticker “ROIV.”

The new capital should fuel the company’s work through mid-2024, Roivant said in a statement on Monday. Once the deal closes, Roivant will have about $2.3 billion in cash.

RELATED: After selling off a clutch of Vants, Roivant CEO Ramaswamy moves upstairs to executive chair 

"I look forward to the next chapter of Roivant's growth by beginning our life as a public company with an exceptionally strong and diverse base of long-term investors," said Roivant CEO Matt Gline in the statement. 

Gline, formerly the chief financial officer, took over from Vivek Ramaswamy, the company’s founder and former CEO in January. Ramaswamy remains involved as Roivant’s executive chairman. 

Executives aren’t the only thing Roivant has shuffled. In December 2019, the company sold off five Vants—Myovant, Urovant, Enzyvant, Altavant and Spirovant—to Sumitomo Dainippon, which now runs them under a new company, Sumitovant. The $3 billion deal also gave the Japanese pharma a 10% stake in Roivant, as well as the chance to buy six more Vants until the second half of 2024. 

Since then, two Sumitovant companies, Urovant and Myovant, have seen their first FDA approvals—in overactive bladder and prostate cancer, respectively. As for the Vants still under the Roivant umbrella, Dermavant delivered two successful phase 3 studies for tapinarof, a psoriasis cream picked up from GlaxoSmithKline.

RELATED: Roivant lines up $3B upfront in Sumitomo Dainippon deal

Roivant started out by picking up programs from other companies and developing them against promising targets. Urovant licensed its overactive bladder treatment Gemtesa (vibegron) from Merck, for example, and Myovant picked up its prostate cancer treatment, Orgovyx (relugolix) from Takeda.

It wasn’t always a winning strategy, though, as evidenced by Axovant and its ill-fated Alzheimer’s drug intepirdine, a GlaxoSmithKline castoff.

Ramaswamy led the one-asset company to a $315 million IPO in 2015, the biggest biotech IPO at that time. But in the next few years, intepirdine failed both in Alzheimer’s and Lewy body dementia and a second asset, licensed for $4 million from Arena Pharma, bit the dust in Parkinson’s disease dementia. Axovant has since spun out its small molecule work into Arvelle Therapeutics and pivoted toward gene therapies.

Over the years, Roivant got better and faster at identifying new drug targets and has added drug discovery to its toolbox, Gline wrote in an email in January.