AIDS drug company Trimeris‘s (NASDAQ:TRMS) plan to merge with drug development company Synageva BioPharma would give Durham, North Carolina-based Trimeris the buyer it has been seeking and it would provide privately held Synageva a public listing and a U.S. Food and Drug Administration-approved drug.
Under terms of the all-stock deal, Synageva will own 75 percent of the combined company’s shares and Trimeris shareholders will own the remaining 25 percent. Additional details have yet to be filed with the U.S. Securities and Exchange Commission. Trimeris’s market capitalization is more than $62 million. The combined company will retain the name of Lexington, Massachusetts-based Synageva BioPharma and operate under the leadership of Synageva’s existing management team. The deal still needs the approval of Trimeris shareholders.
Synageva was founded in 2008. Its lead drug candidate is SBC-102, an enzyme replacement therapy for patients with lysosomal acid lipase deficiency, a rare genetic disease in which patients are born without the ability to produce the lysosomal acid lipase enzyme. The absence of this enzyme results in the buildup of fatty material in the body’s blood vessels and organs. SBC-102 has orphan drug designation in the United States and Europe.
Private equity-backed Synageva raised $25 million in March, which brought its fundraising total to $70 million since its 2008 founding. Its investors include Baker Brothers Investments, Tullis Dickerson and Four Partners. Approval of the deal would make Synageva a public company. If more money is needed for clinical work on SBC-102 and the rest of the drug pipeline, Synageva would be able to tap the public markets to raise cash.
“This transaction gives us access to significant financial resources while maintaining our focus on the goal of bringing our clinical development programs to commercialization as soon as possible,” Synageva CEO Sanj Patel said in a prepared statement.
Trimeris was founded in 1993 to develop a class of anti-HIV drugs called fusion inhibitors. Fuzeon, Trimeris’ only FDA-approved product, is marketed under an agreement with Roche. (OTC:RHHBY) Net sales of Fuzeon were $88.4 million in 2010, down 21 percent from 2009. Fuzeon sales have steadily declined in recent years as new AIDS treatments have entered the market. Trimeris in 2008 cut its R&D efforts and in 2009, entered into a merger agreement with South Korean company Arigene, which bid $81 million to buy the company. But Arigene terminated the deal when it couldn’t secure financing.
