Brooklyn ImmunoTherapeutics Completes Acquisition of Novellus Therapeutics
July 19 2021 - 8:00AM
Brooklyn ImmunoTherapeutics, Inc. (NYSE American: BTX)
(“Brooklyn”), a biopharmaceutical company focused on exploring the
role that cytokine and gene editing/cell therapy can have in
treating patients with cancer, blood disorders, and monogenic
diseases, today announced that it had completed, on July 16, 2021,
its acquisition of Novellus Therapeutics Limited (“Novellus”).
Novellus is developing next-generation engineered mesenchymal stem
cell (“MSC”) therapies using extensively patented mRNA-based cell
reprogramming and gene editing technologies licensed from Factor
Bioscience (“Factor”). The transaction advances Brooklyn’s
evolution into a platform company with a pipeline of
next-generation engineered cellular, gene editing and cytokine
programs.
Key Transaction Highlights:
- Brooklyn acquired Novellus for
consideration totaling $125 million, which consisted of $23 million
in cash and 7,022,230 shares of Brooklyn common stock, which were
valued at a total of $102 million based on a price of approximately
$14.53 per share. Immediately following the closing, the shares
issued represented, on an as-converted basis, 13.6% of the shares
of Brooklyn’s outstanding common stock, which closed at a price of
$10.05 per share on July 16, 2021.
- The co-founders of Novellus entered
into lock-up agreements with respect to 3,377,690 of the shares of
Brooklyn common stock issued in the transaction. The contractual
lock-ups extend for a period of three years, subject to certain
early release provisions based on the Brooklyn stock price. In
support of the transaction, Brooklyn’s Board Chair and its Chief
Executive Officer and President entered into identical lock-up
agreements with respect to their current holdings.
- Following the transaction, Brooklyn
had approximately $25 million of cash, which Brooklyn projects,
based on its current operating plans, will be sufficient to fund
operations through the end of 2023.
- The transaction relieves Brooklyn
from its obligation to pay Novellus a set of upfront fees, clinical
development milestone fees and post-registration royalties under a
license agreement that Brooklyn entered into in April 2021 with
Novellus and Factor. In addition, the acquisition builds on the
license agreement, and leaves in place the Factor component of that
agreement, which grants Brooklyn exclusive rights to develop
certain next-generation mRNA-based gene editing and cell therapy
products.
- As a result of the acquisition,
Brooklyn also acquired 25% of the outstanding equity of NoveCite,
Inc., a company focused on bringing an allogeneic (off-the-shelf)
MSC product to patients with acute respiratory distress syndrome
(ARDS), including from COVID-19.
“We are confident that the Novellus transaction
will provide significant forward momentum in the gene editing and
mRNA spaces,” said Brooklyn’s Chief Executive Officer and President
Howard J. Federoff, M.D., Ph.D. “The addition of Novellus will
accelerate our research and development efforts, potentially
facilitating faster development of clinical products for orphan
diseases such as sickle cell anemia, familial amyloidosis and cell
therapies for cancer. We believe the transaction makes it possible
for us to enter first-in-human trials as early as 2023 and
positions Brooklyn to become a leader in stem cell therapies, gene
editing and mRNA therapeutics, with the ability to develop multiple
therapeutic candidates rapidly.”
“We look forward to continuing to update our
stockholders on our progress and to speaking with them to provide
additional details on this transformative transaction,” concluded
Dr. Federoff.
Brooklyn will be conducting a conference call at
4:15PM ET on July 19, 2021 to discuss the transaction and future
plans. Participants can register for the call here and will receive
dial-in information to put them directly into the call. Those who
are unable to register may access the conference by calling
1-866-777-2509 (toll free U.S.) or 1-412-317-5413 (internationally)
and then asking the operator to join them into the Brooklyn
ImmunoTherapeutics conference call. The conference will also be
webcast, which can be accessed here. A replay of the call will be
available via the webcast link as well as on Brooklyn’s website in
the investor relations section, for one week following the
call.
About Brooklyn ImmunoTherapeutics
Brooklyn is focused on exploring the role that
cytokine, gene editing, and cell therapy can have in treating
patients with cancer, blood disorders, and monogenic diseases.
Brooklyn’s most advanced program is IRX-2, a
human cell-derived cytokine therapy, studying the safety and
efficacy of IRX-2 in patients with head and neck cancer in Phase
2B. In a Phase 2A clinical trial in head and neck cancer, IRX-2
demonstrated an overall survival benefit. Additional studies are
either underway or planned in other solid tumor cancer
indications.
Brooklyn has multiple next-generation cell and
gene-editing therapies in preclinical development for various
indications including acute respiratory distress syndrome, solid
tumor indications, as well as in vivo gene-editing therapies for
rare genetic diseases. For more information about Brooklyn and its
clinical programs, please visit www.BrooklynITx.com.
Forward-Looking Statements
The third bullet under, and the paragraph
immediately following, “Key Transaction Highlights” contain
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, which are intended to
be covered by the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are any
statements that are not statements of historical fact and may be
identified by terminology such as “believe,” “plan,” “possible,”
“potential,” “project,” or “will” or other similar words.
Forward-looking statements are based on current beliefs and
assumptions that are subject to risks and uncertainties and are not
guarantees of future performance. Actual results could differ
materially from those stated or implied in any forward-looking
statement as a result of various factors, including, but not
limited to, uncertainties related to: (i) the evolution of
Brooklyn’s business model into a platform company focused on
cellular, gene editing and cytokine programs; (ii) Brooklyn’s
ability to successfully, cost-effectively and efficiently develop
its technology and products; (iii) Brooklyn’s ability to
successfully commence clinical trials of any products on a timely
basis or at all; (iv) Brooklyn’s ability to successfully fund
and manage the growth of its development activities;
(v) Brooklyn’s ability to obtain regulatory approvals of its
products for commercialization; and (vi) uncertainties related to
the impact of the COVID-19 pandemic on the business and financial
condition of Brooklyn, including on the timing and cost of its
clinical trials. You should not rely upon forward-looking
statements as predictions of future events. The forward-looking
statements made in this communication speak only as of the date on
which they were made, and Brooklyn does not undertake any
obligation to update the forward-looking statements contained
herein to reflect events that occur or circumstances that exist
after the date hereof, except as may be required by applicable law
or regulation.
Investor Relations Contact:CORE
IR516-222-2560investors@brooklynitx.com
Media Contact:Jules AbrahamCORE
IR917-885-7378julesa@coreir.com
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