Rio Grande Therapeutics, the electroceuticals maker that inked a $21.5 million agreement to be acquired by fellow bioelectronics player Endonovo last month, has pulled out of the deal.
Rio Grande CEO Steven Gluckstern terminated the binding letter of intent Friday, following a request to renegotiate the terms of the agreement, according to an Endonovo statement. “Our board of directors has determined we are better served by this decision,” Endonovo said.
Endonovo has canceled the $500,000 note it issued toward the $21.5 million buyout. The California-based company had planned to hand over $15 million in Endonovo common stock, $5 million in Endonovo warrants and $1.5 million in cash as part of the transaction.
The duo announced in early July that they planned to sign an agreement in the quarter ending Sept. 30. Endonovo--which markets a noninvasive bioelectronic device to treat or ward off organ failure brought on by inflammation and necrosis--stood to gain all of Rio Grande’s products, including its FDA-cleared tPEMF tech for the treatment of postsurgical neuroinflammation.
"We believe this acquisition will significantly increase Endonovo's trajectory as we continue developing our non-invasive treatments for acute inflammatory conditions in vital organs," said Endonovo CEO Alan Collier at the announcement of the deal. "The combined company creates greater shareholder value for both RGN and Endonovo and will further establish Endonovo at the forefront of bioelectronic medicine."
The deal would have boosted Endonovo’s reach in the rising bioelectronics/electroceuticals field, which players like pharma giant GlaxoSmithKline ($GSK) are trying to get in on. It rests on the premise that the body’s electrical impulses can be manipulated to heal itself from illness. The goal is to create implantable bioelectronic devices that could potentially cause biochemical changes in the body that are traditionally brought on by drugs.
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