Bioelectronics player Endonovo will acquire Rio Grande Neurosciences, which also makes bioelectronic devices to treat inflammation, diseases and disorders of the central nervous system.
The deal is subject to a definitive purchase agreement, shareholder approvals and Endonovo raising more capital. The duo plan to sign an agreement within the quarter ending September 30. Of the total $21.5 million, $15 million will be in Endonovo common stock, $5 million will be in Endonovo warrants and the remaining $1.5 million will be in cash, according to a statement.
Endonovo will gain Rio Grande and all of its products, including the FDA-cleared tPEMF technology for the treatment of postsurgical neuroinflammation.
The treatment is administered by the company’s TheraCap and is used to address pain and edema. Rio Grande is currently studying its use in traumatic brain injury and other indications that include neuroinflammation, including concussion and multiple sclerosis, according to the statement. Endonovo will also pick up in-development devices, including a magnetic coil device that noninvasively stimulates activity in specific parts of the brain, which has been submitted for 510(k) approval to treat major depressive disorder.
"We believe this acquisition will significantly increase Endonovo's trajectory as we continue developing our non-invasive treatments for acute inflammatory conditions in vital organs," said Endonovo CEO Alan Collier in a statement. "The combined company creates greater shareholder value for both RGN and Endonovo and will further establish Endonovo at the forefront of bioelectronic medicine."
Bioelectronics, also known as electroceuticals, is a hot new field that could turn drug development on its head. It relies on the premise that the body’s electrical impulses may be manipulated to heal itself from illness. Bioelectronics are implantable devices that could potentially bring about biochemical changes in the body that are currently prompted by drugs.
Pharma giant GlaxoSmithKline ($GSK) has been working on electroceuticals since 2012 and hopes to bring its own device, as well as third-party devices, into clinical trials within the next few years. And Santa Clara, CA-based NeuSpera is developing a tiny injectable neuromodulation device, which it expects could treat chronic illness.
- read the statement
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