Yumanity Therapeutics, a US-based neurodegenerative disease treatment developer backed by corporates Biogen, Merck & Co, Pfizer and Sanofi, agreed to a reverse merger with Proteostasis Therapeutics on Monday.
Proteostasis is a cystic fibrosis treatment developer that floated on Nasdaq in 2016 through a $50m initial public offering after more than $127m in equity funding from investors including pharmaceutical firms Novartis, Perrigo and Sanofi. Its market capitalisation stood at $72m this morning.
Proteostasis will rebrand to Yumanity Therapeutics upon completion of the deal and Richard Peters, president and chief executive of Yumanity, will lead the combined business. Yumanity’s shareholders are expected to own 67.5% of the merged company.
Founded in 2014, Yumanity is working on therapies for neurodegenerative diseases caused by protein misfolding, which can lead to brain cells malfunctioning and dying.
The company’s lead asset is being developed to treat Parkinson’s disease and is in phase 1 clinical trials. The merger will allow the combined business to tap into a common scientific expertise in protein misfolding.
Yumanity said it has raised more than $100m in funding. Biotechnology company Biogen and Sanofi-Genzyme BioVentures, a corporate venturing subsidiary of pharmaceutical firm Sanofi, contributed to a $45m series A round in 2016 led by investment and financial services group Fidelity.
Alexandria Venture Investments, a subsidiary of life sciences real estate investment trust Alexandria Real Estate Equities, also took part in the series A round, as did Redmile Group and Dolby Family Ventures.
A regulatory filing shows Yumanity secured $31.1m in July 2018, and it added $21.6m in a June 2020 series C round featuring pharmaceutical firms Merck & Co and Pfizer – the latter through its Pfizer Ventures unit – Fidelity, Alexandria Venture Investments, Redmile Group, Dolby Family Ventures and private investor Tony Coles.
Proteostasis is seeking to monetise its cystic fibrosis assets, with a contingent value rights agreement entitling current shareholders to all net proceeds if a sale, grant or transfer closes before the merger is completed, or a portion of proceeds for up to nine months following the merger.
