On April 28, 2022 Peak Bio Co., Ltd. ("Peak Bio"), a clinical-stage biopharmaceutical company focused on developing the next-generation of therapeutics to treat oncology and inflammatory diseases, and Ignyte Acquisition Corp. (Nasdaq: IGNY) ("Ignyte"), a special purpose acquisition company ("SPAC"), reported they have entered into a definitive business combination agreement (Press release, Peak Bio, APR 28, 2022, View Source [SID1234613192]). Upon closing of the transaction, Ignyte will be renamed Peak Bio, Inc. (the "Combined Company") and will be led by Hoyoung Huh, MD, Ph.D., Chief Executive Officer of Peak Bio. The Combined Company expects to list its stock on Nasdaq under the ticker symbol "PKBO".
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A group of healthcare investors including existing Peak Bio stockholders and Palo Alto Investors have committed to participate in the transaction through a $25 million common stock PIPE at a purchase price of $10.00 per share. Gross proceeds of the transaction available to the Combined Company at closing will approximate $82.5 million (assuming no redemptions from Ignyte’s trust account and before transaction expenses).
Dr. Huh stated that "We are excited about our differentiated inflammation and oncology pipeline and look forward to partnering with Ignyte and advancing our pipeline of potential blockbuster candidates. We believe we will have several near-term catalysts that can be achieved with our cash at closing. Much of our work is the culmination of our efforts at our Korean and US research sites which captured the best of pan pacific financing alternatives, diverse and highly talented scientific acumen, all the while creating a novel mechanism to bring valuable assets to bear into the U.S. NASDAQ market."
David Rosenberg, Chairman and co-CEO of Ignyte Acquisition Corp., commented, "We are excited to partner with the Peak team in this first of its kind transaction, taking an exciting South Korean biotechnology company public on Nasdaq via a SPAC. Dr. Huh’s reputation as a serial founder and entrepreneur of multiple public and private biotech companies made Peak the perfect merger target for Ignyte. We look forward to helping Peak execute on its compelling therapeutic pipeline in both oncology and rare inflammatory disease in order to not only drive shareholder value, but to improve quality of life for those impacted by Peak Bio’s targeted diseases."
Peak Bio Overview
Peak Bio’s pipeline is focused on developing drugs to treat oncology and inflammatory diseases. The company’s pipeline of inflammatory therapeutic candidates is led by PHP-303, which is currently Phase II ready in AATD and works by inhibiting a bioactive form of Neutrophil Elastase. The company’s pipeline also includes an antibody drug conjugate platform focused on developing therapies for oncology indications.
PHP-303 – 5th Generation Best-In-Class Neutrophil Elastase (NE) Inhibitor: PHP-303, is an oral QD, reversible and highly selective small molecule addressing toxicity and efficacy shortfalls from previous generation Neutrophil Elastase Inhibitors by inhibiting the bioactive form of enzyme.
PHP-303 was acquired from Bayer and improved to be an ideal solution for conditions involving NE imbalance with well-demonstrated tolerability and safety / PK data.
PHP-303 is a best-in-class Phase II ready NE Inhibitor targeting AATD and ARDS diseases where chronic inflammatory imbalance and NE are important determinants in disease progression
Antibody Drug Conjugate (ADC) Platform: Unlike competitors, Peak Bio’s approach to ADCs engages the immune system to enhance tumoricidal activity reducing the number of treatment cycles and improving toxicity with a proprietary approach towards the generation of novel toxins.
Peak Bio’s most advanced ADC candidate targeting Trop2 has shown superior linker stability and in vivo activity compared to an FDA-approved competitor with superior specificity to cancer cells and a unique ability to generate neoepitopes and synergize with I/O therapies.
De-risking steps such as the manufacturability assessment have revealed no liability that may impede the manufacturing of the Peak Bio Trop2 antibody and safety studies have demonstrated that our ADC was safely tolerated in repeat-dose preclinical primate studies.
We are working to validate other solid tumor targets to partner with our current toxin and other novel toxins to further solidify our oncology portfolio.
Planned Milestones and Uses of Proceeds:
Proceeds from the PIPE and merger transaction are expected to provide Peak Bio with capital to further develop its clinical-stage programs and ADC platform technology, including:
Initiate and fund a Phase II AATD Adaptive Design study in 2022 with a data readout expected in the first half of 2024
Submission to DoD for Phase II grant of PHP-303 in ARDS and an IND submission in the first half of 2023
Fund ADC toxin studies in lead program targeting Trop2 leading toward an IND submission in the second half of 2023 and begin Phase Ia initiation in 2024
Conduct research and development to identify new ADC toxins
Summary of Transaction
The transaction values the combined company at a pro forma equity value of $278 million, assuming a $10.00 per share price and no shareholder redemptions. As a result of the transaction, the combined company is expected to have more than $82.5 million in gross proceeds from a combination of approximately $57.5 million in cash held in Ignyte’s trust account (assuming no Ignyte stockholders exercise their redemption rights at closing) and more than $25 million, at $10.00 per share, from a fully committed PIPE.
The PIPE includes participation from leading healthcare institutional investor, Palo Alto Investors and insiders.
The transaction, which has been approved by each of Ignyte’s Board of Directors, Peak Bio’s Board of Directors and Peak Bio’s shareholders is expected to be completed in the third quarter of 2022, subject to approval by Ignyte’s shareholders and satisfaction, or the waiver of, customary closing conditions identified in the business combination agreement.
Chardan and Ladenburg Thalmann & Co. Inc. are serving as the financial advisors to Ignyte and Peak Bio. DLA Piper LLP (US) is serving as legal advisor to Ignyte. Bae, Kim & Lee LLC and B C Burr McCabe Law are serving as legal advisors to Peak Bio.
Additional information about the transaction, including copies of certain documents related to the transaction, including the investor presentation, will be provided in a Current Report on Form 8-K to be filed by Ignyte with the Securities and Exchange Commission (the "SEC") and available at www.sec.gov and on the Ignyte website at View Source In addition, Ignyte intends to file a proxy statement with the SEC, which will include additional information regarding the transaction (the "Proxy Statement"), and will file other documents regarding the transaction with the SEC.