On September 24, 2025 ESSA Pharma Inc. ("ESSA," or the "Company") (NASDAQ: EPIX) reported that it has reached an agreement to amend its previously announced Business Combination Agreement (the "Amended Agreement") with XenoTherapeutics Inc. ("Xeno"), a non-profit biotechnology company (Press release, ESSA, SEP 24, 2025, View Source [SID1234656208]). XOMA Royalty Corporation ("XOMA Royalty") (NASDAQ: XOMA) continues to act as structuring agent and intends to provide financing for the transaction (the "Transaction").
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Under the Amended Agreement, ESSA shareholders are now expected to receive approximately US$0.12, exclusive of future non-transferable contingent value right ("CVR") payments and exclusive of the approximately US$1.69 of cash previously distributed to ESSA shareholders, per Common Share at closing (as compared to the approximately US$1.91 that was originally estimated as the aggregate distribution, as described in greater detail below), plus one CVR per Common Share, which CVR now represents the right to receive up to approximately US$0.14 per CVR and payable within specified periods following the close of the Transaction. The potential CVR payments of US$0.14 per Common Share represents up to US$6.7 million in the aggregate that may be distributed to CVR holders depending on the outcome of certain contingent liabilities. ESSA and Xeno are making this change in light of potential liabilities, associated expenses and the latest estimates of the Company’s expected cash balance at closing. ESSA will be filing the Amended Agreement on a Current Report on Form 8-K.
As previously disclosed on July 14, 2025, ESSA shareholders were expected to receive a cash payment per Common Share determined based on ESSA’s cash balance at closing, plus one CVR per Common Share. At that time, ESSA estimated that shareholders would receive approximately US$1.91 per Common Share, exclusive of any CVR payments. On August 22, 2025, ESSA distributed approximately US$1.69 per Common Share to its shareholders as an initial cash distribution.
ESSA intends to apply to the Supreme Court of British Columbia (the "Court") to amend the interim order obtained from the Court on August 5, 2025 (the "Interim Order") following the adjournment of the Meeting. The amended Interim Order would provide for a new Meeting date of October 3, 2025, a new deadline to deliver notices of dissent of October 1, 2025, a new Court hearing date for approval of the Arrangement of October 7, 2025 and a deadline of October 3, 2025 for responses for persons intending to attend the October 7th hearing.
Special Meeting to Reconvene on October 3, 2025
In connection with the Amended Agreement, ESSA also announced today that it has further adjourned its special meeting of the holders of common shares of the Company ("Common Shares" and the holders of such Common Shares, the "Shareholders"), optionholders and warrantholders (the "Special Meeting") scheduled to occur on September 29, 2025.
The Special Meeting will now reconvene at 2:00 p.m. (Pacific Time) on October 3, 2025. The Special Meeting will still be held online via a live interactive webcast on the internet at View Source
The additional adjournment will allow time for shareholders to consider and approve the Amended Agreement. Shareholders who have already voted on the transaction and do not wish to change their vote do not need to take any further action.
ESSA will file supplemental proxy materials reflecting the revised terms in due course.
Advisors
Leerink Partners is serving as the exclusive financial advisor to ESSA and Blake, Cassels & Graydon LLP and Skadden, Arps, Slate, Meagher & Flom LLP are serving as ESSA’s Canadian legal counsel and U.S. legal counsel, respectively.
Stikeman Elliott LLP and Gibson, Dunn & Crutcher LLP are serving as XOMA Royalty’s Canadian legal counsel and U.S. legal counsel, respectively.