Shire founder oversees reverse merger of rare-disease startup onto AIM

A rare-disease startup chaired by the founder of Shire ($SHPG) is set to snag a listing on London's AIM through a reverse takeover. The startup, Amryt Pharmaceuticals, is raising £10 million ($14 million) in conjunction with the deal, a sum it will use to run a Phase III trial of its lead candidate in patients with a group of rare inherited skin disorders known as epidermolysis bullosa.

Harry Stratford, the founder of Shire, is on board as chairman, while ex-Sofinnova Ventures principal and Astellas Pharma medical director Joseph Wiley is serving as CEO. Michele Bellandi, the former head of Shire's European commercial operation, is expected to take up the post of COO. The trio gives Amryt, which was only founded in August, credentials as it sets out to deliver a rare-disease strategy that is focused on acquiring or in-licensing assets and pushing them through the final stages of clinical development.

Amryt has kicked off the strategy by agreeing to deals to buy Birken and Som Pharmaceuticals, a pair of European drug developers that will add candidates against epidermolysis bullosa, acromegaly and Cushing's disease to its pipeline. The near-term focus is on Episalvan, a drug that Birken has already won approval for as a way to accelerate healing of partial thickness wounds. As epidermolysis bullosa is characterized by the development of such wounds, Amryt thinks it can position Episalvan as a drug capable of improving outcomes in the indication.

The severity of the condition varies from patient to patient, but the blistering of the skin it causes can be detrimental to quality of life. "It is a pretty horrific disease," Wiley told Proactive Investors. "In the severe forms, the parents change the wound dressings every three to four days." Wiley and his colleagues hope to improve the situation for these patients by starting a Phase III trial of Episalvan in the condition in the second half of the year. Some of the £10 million Amryt is planning to raise will go toward financing the trial.

Amryt is raising the cash in conjunction with a reverse merger involving Fastnet Equity, an AIM-listed organization that was involved in the oil and gas business. Faced with turbulence in the oil sector, the company decided last year to pivot into healthcare. "Our feeling was that investing in a pharma company was one of the few market opportunities where a prospective investor might get the potential to generate a multiple uplift in share appreciation much like a successful oil exploration campaign can generate," Fastnet chairman Cathal Friel told The Irish Times.

Friel, the managing director of Raglan Road Capital, is one of the founders of Amryt. The company is the second life science player in the space of a month to capitalize on the issues facing the oil and gas sector. Last month, SalvaRx, an oncology investor backed by Jim Mellon, picked up an AIM listing through a reverse takeover of 3Legs Resources. Prior to becoming a shell company, 3Legs was trying to build a business upon shale gas from Poland.

- read the statement
- check out Proactive Investors' article
- here's the Times' piece
- and the Independent's take