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Aug 1, 2013

PharmAthene, Theraclone Agree to Merger

  • PharmAthene is merging with Theraclone Sciences to create a combined company focused on developing vaccines against infectious diseases and human monoclonal antibody (mAb) drugs against cancer, the companies said today. The price was undisclosed.

    The combined company, to be headed by Theraclone CEO Clifford J. Stocks, will pursue development of four clinical-stage product candidates targeting high-value commercial and government markets, as well as a discovery pipeline with four preclinical programs and multiple discovery candidates, along with three products being developed with partners.

    “A merger with Theraclone will significantly advance PharmAthene's goal of achieving broader portfolio diversification," Eric I. Richman, PharmAthene’s president and CEO, said in a statement. "The combined company will have the potential to generate substantial value for stockholders through both corporate collaborations and the development of its own proprietary therapeutic mAbs targeting high-value commercial markets."

    Richman will serve as a director of the combined company's board. The deal has been approved by the PharmAthene and Theraclone boards, but remains subject to shareholder and regulatory approval, and other customary closing conditions.

    The combined company will develop two Theraclone mAb drug candidates—TCN-202 CMV antibody for prevention and treatment of human cytomegalovirus (HCMV) infections, and TCN-032 influenza antibody for pandemic and severe seasonal influenza—plus another mAb, PharmAthene’s Valortim® anthrax antitoxin; and PharmAthene’s SparVax®, a recombinant protective antigen (rPA), next-generation anthrax vaccine for pre and post-exposure prophylaxis of anthrax infection.

    Furthest along in clinical trials is TCN-032, which has completed a Phase IIa study, results of which are set to be announced later this year. Also set for later this year is a Phase II study in solid organ transplant for TCN-202, which has completed a Phase I study. The combined company said it will explore other indications for TCN-202.

    Additional Phase II testing will occur as well for Sparvax, which has already completed two Phase II and one Phase I studies involving 770 patients. Valortim has completed two Phase I clinical trials. The combined company will also use Theraclone’s I-STAR™ memory B-cell interrogation platform, designed to facilitate discovery of human antibodies against novel targets, to advance a preclinical pipeline and ongoing collaborations.

    Theraclone has a discovery collaboration with Pfizer focused on two infectious disease targets and an oncology target, all undisclosed, for which Theraclone has received upfront payments and research funding, and may receive milestone payments tied to development and commercialization milestones, plus royalties on product sales in the future. The research payments and milestone payments could add up to $632 million, the company said when the Pfizer collaboration was announced in 2011, and again last year.

    Another collaboration partner is Zenyaku Kogyo, which in 2010 won exclusive license rights in Japan to Theraclone’s flu antibody program. At the time, Theraclone won more than $9 million in fees, research milestone payments, and an equity investment from Zenyaku Kogyo toward a total $18 million through Phase I clinical trials. Theraclone is eligible for clinical milestone payments and royalties from potential future sales in Japan.

    A wholly owned subsidiary of PharmAthene will merge into Theraclone in an all-stock transaction.  PharmAthene will issue shares of its common stock to Theraclone stockholders, who will own 50% of the combined company and PharmAthene shareholders, the rest.


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