SAN DIEGO and AUSTIN, Texas, Jan. 7,
2017 /PRNewswire/ -- Mast Therapeutics, Inc. (Mast,
NYSE MKT: MSTX) and Savara Inc. (Savara), a privately-held emerging
specialty pharmaceutical company focused on the treatment of rare
respiratory diseases, today announced that the two companies have
entered into a definitive merger agreement, under which the
stockholders of Savara would become the majority owners of Mast,
and the operations of Mast and Savara would be combined. Subject to
stockholder approval, the combined company will advance a pipeline
of novel inhalation therapies for the treatment of diseases with
significant unmet medical needs, featuring three product
candidates, each in advanced clinical development.
The combined company pipeline will include:
- AeroVanc, an inhaled dry-powder vancomycin to treat
chronic methicillin-resistant Staphylococcus aureus (MRSA)
pulmonary infection in cystic fibrosis (CF) in preparation for a
pivotal Phase 3 study
- Molgradex, an inhaled nebulized GM-CSF to treat
pulmonary alveolar proteinosis (PAP) currently in Phase 2/3
development
- AIR001, an inhaled nebulized sodium nitrite solution to
treat heart failure with preserved ejection fraction (HFpEF)
currently in Phase 2 development
"Following an extensive review of strategic alternatives and a
thorough process, the Mast Board of Directors chose to combine with
Savara because we believe the proposed merger provides an
attractive opportunity for our shareholders to obtain value
appreciation from a diversified pipeline and positions the company
for more rapid short- and long-term growth via a triad of
late-stage clinical assets with important forthcoming milestones,"
stated Brian M. Culley, current
Chief Executive Officer and Director of Mast Therapeutics. "We are
excited for the prospects of the combined company and believe that
Savara's management team is well equipped to advance the pipeline
toward regulatory approvals and commercialization in the US and
EU."
Rob Neville, Chairman and CEO of
Savara added, "This merger is transformative for Savara and marks
our second transaction in a year, each expanding Savara's pipeline
of inhaled therapies for serious and life-threatening diseases.
AeroVanc and Molgradex are orphan-designated product candidates in
late-stage development, and we see Mast's AIR001 program
potentially adding significant value to our pipeline with a modest
capital outlay in 2017. We believe the favorable risk profile of
our product candidates combined with their market potential
provides a unique opportunity for Savara to become the next
breakout company in orphan pulmonary diseases."
Select Anticipated Upcoming Development Milestones
- Initiate a pivotal Phase 3 study of AeroVanc for the treatment
of MRSA in CF patients in Q3/2017.
- Announce top-line results from a registration-enabling Phase
2/3 study of Molgradex for the treatment of PAP currently ongoing
for Europe and Japan in Q1/2018.
- Complete negotiations with the U.S. Food and Drug
Administration (FDA) on the requirements for a pivotal clinical
study of Molgradex in the U.S. in Q3/2017.
- Announce results from an ongoing 100-patient Phase 2 study of
AIR001 for the treatment of HFpEF being conducted by the Heart
Failure Clinical Research Network in Q1/2018.
About the Proposed Merger
Under the terms of the merger agreement, pending stockholder
approval of the transaction, Savara stockholders will receive newly
issued shares of Mast common stock in exchange for their Savara
stock. The exchange ratio was determined using a pre-transaction
valuation of $115 million for
Savara's business, based on its latest priced investment round and
an acquisition of assets of Serendex Pharmaceuticals A/S, and
$36.5 million for Mast's business, a
premium to the 20-day volume weighted average share price of Mast.
As a result, current Mast stockholders will collectively own
approximately 24%, and Savara stockholders will collectively own
approximately 76%, of the combined company on a pro-forma basis,
subject to adjustment based on Mast's net cash balance and Mast's
and Savara's capitalization at closing.
The combined company, led by Savara's current management team,
is expected to be named Savara Inc. and be headquartered in
Austin, TX. Prior to
closing, Mast will seek stockholder approval to conduct a reverse
split of its outstanding shares to satisfy listing requirements of
the NYSE MKT. The combined company is expected to trade on the NYSE
MKT under a new ticker symbol. At closing, the combined company's
board of directors is expected to consist of seven members,
including five members of Savara's current board and two members of
Mast's current board. The merger agreement has been unanimously
approved by the board of directors of each company. The transaction
is expected to close by the second quarter of 2017, subject to
approvals by the stockholders of Mast and Savara, and other
customary closing conditions.
Mast's financial advisor in the transaction is Roth Capital
Partners. Canaccord Genuity Inc. is acting as financial advisor to
Savara. DLA Piper LLP (US) is serving as legal counsel to Mast and
Wilson Sonsini Goodrich &
Rosati, P.C. is serving as legal counsel to Savara.
Conference Call and Webcast
Mast and Savara will hold a conference call Monday, January 9, 2017, at 8:30 a.m. Eastern Time / 5:30 a.m. Pacific Time to discuss the proposed
transaction. Interested parties may access the conference
call by dialing (855) 239-3120 from the U.S., (855) 669-9657 from
Canada, and (412) 542-4127 from
outside the U.S. and should request the Mast-Savara Conference
Call. A live webcast of the conference call will be available
online from the Investors section of Mast's website at
http://www.masttherapeutics.com/investors/events/. Replays of the
webcast will be available on Mast's website for 30 days.
About Savara
Savara Inc. is an emerging specialty pharmaceutical company
developing treatments for rare respiratory diseases. The company
has two product candidates in late stage clinical trials including
AeroVanc – the first dry powder inhaled antibiotic being developed
for the treatment of persistent MRSA infection in people with CF –
and Molgradex – a proprietary, nebulized formulation of recombinant
human GM-CSF for the treatment of PAP. More information can be
found at www.savarapharma.com.
Savara acquired the assets of Copenhagen-based Serendex Pharmaceuticals A/S
on July 15, 2016. Serendex was
established in 2008 and listed on the Oslo Stock Exchange in 2014.
Serendex operated as a public company until their delisting on
May 4, 2016, ahead of its acquisition
by Savara.
About Mast Therapeutics
Mast Therapeutics, Inc. is a publicly traded biopharmaceutical
company headquartered in San Diego,
California. Mast's lead product candidate, AIR001, is a
sodium nitrite solution for intermittent inhalation via
nebulization in Phase 2 clinical development for the treatment of
HFpEF. More information can be found at
www.masttherapeutics.com.
Safe Harbor Statements
Additional Information about the Proposed Merger and Where
to Find It
In connection with the proposed merger, Mast intends to file
relevant materials with the Securities and Exchange Commission, or
the SEC, including a registration statement on Form S‑4 that will
contain a prospectus and a joint proxy statement. Investors
and security holders of Mast and Savara are urged to read these
materials when they become available because they will contain
important information about Mast, Savara and the proposed merger.
The joint proxy statement, prospectus and other relevant materials
(when they become available), and any other documents filed by Mast
with the SEC, may be obtained free of charge at the SEC web site at
www.sec.gov. In addition, investors and security holders may
obtain free copies of the documents filed with the SEC by Mast by
directing a written request to: Mast Therapeutics, Inc. 3611 Valley
Centre Drive, Suite 500, San Diego,
California 92130, Attn: Investor Relations. Investors and
security holders are urged to read the joint proxy statement,
prospectus and the other relevant materials when they become
available before making any voting or investment decision with
respect to the proposed merger.
This communication shall not constitute an offer to sell or the
solicitation of an offer to sell or the solicitation of an offer to
buy any securities, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offering of securities
in connection with the proposed merger shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
Participants in the Solicitation
Mast and its directors and executive officers and Savara and its
directors and executive officers may be deemed to be participants
in the solicitation of proxies from the stockholders of Mast and
Savara in connection with the proposed transaction. Information
regarding the special interests of these directors and executive
officers in the proposed merger will be included in the joint proxy
statement/prospectus referred to above. Additional information
regarding the directors and executive officers of Mast is also
included in Mast Annual Report on Form 10-K for the year ended
December 31, 2015 and the proxy
statement for Mast's 2016 Annual Meeting of Stockholders. These
documents are available free of charge at the SEC web site
(www.sec.gov) and from Investor Relations at Mast at the
address described above.
Forward Looking Statements
Mast cautions you that statements in this press release that are
not a description of historical fact are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements may be identified by the use of
words referencing future events or circumstances such as "expect,"
"intend," "plan," "anticipate," "believe," and "will," among
others. Such statements include, but are not limited to, statements
regarding the structure, timing and completion of our proposed
merger with Savara; our continued listing on NYSE MKT prior to and
after the proposed merger; our expectations regarding the
capitalization, resources and ownership structure of the combined
organization; our expectations regarding the sufficiency of the
combined organization's resources to fund the advancement of any
development program or the completion of any clinical trial; the
nature, strategy and focus of the combined organization; the
safety, efficacy and projected development timeline and commercial
potential of any product candidates; the executive officer and
board structure of the combined organization; and the expectations
regarding voting by Mast and Savara stockholders. Mast and/or
Savara may not actually achieve the proposed merger, or any plans
or product development goals in a timely manner, if at all, or
otherwise carry out the intentions or meet the expectations or
projections disclosed in our forward-looking statements, and you
should not place undue reliance on these forward-looking
statements. Because such statements are subject to risks and
uncertainties, actual results may differ materially from those
expressed or implied by such forward-looking statements.
These forward-looking statements are based upon Mast's and Savara's
current expectations and involve assumptions that may never
materialize or may prove to be incorrect. Actual results and
the timing of events could differ materially from those anticipated
in such forward-looking statements as a result of various risks and
uncertainties, which include, without limitation, risks and
uncertainties associated with stockholder approval of and the
ability to consummate the proposed merger through the process being
conducted by Mast and Savara, the ability to project future cash
utilization and reserves needed for contingent future liabilities
and business operations, the availability of sufficient resources
for combined company operations and to conduct or continue planned
clinical development programs, the timing and ability of Mast or
Savara to raise additional equity capital to fund continued
operations; the ability to successfully develop any of Savara's
product candidates, and the risks associated with the process of
developing, obtaining regulatory approval for and commercializing
drug candidates that are safe and effective for use as human
therapeutics. Risks and uncertainties facing Mast are
described more fully in Mast's periodic reports filed with the SEC
available at www.sec.gov. You are cautioned not to place undue
reliance on forward-looking statements, which speak only as of the
date on which they were made. Mast undertakes no obligation
to update such statements to reflect events that occur or
circumstances that exist after the date on which they were made,
except as may be required by law.
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SOURCE Mast Therapeutics