Tetraphase Pharmaceuticals, Inc. (Nasdaq:TTPH), a
biopharmaceutical company focused on commercializing its novel
tetracycline XERAVATM (eravacycline for injection) to treat serious
and life-threatening infections, today announced that its Board of
Directors has received a revised proposal from Melinta
Therapeutics, Inc. (“Melinta”) amending its prior proposal to
acquire the Company (the “Amended Melinta Proposal”), and has
determined that the Amended Melinta Proposal is a “Superior Offer”
under the terms of the Agreement and Plan of Merger, dated March
15, 2020 and amended on May 27, 2020, to which the Company is a
party with AcelRx Pharmaceuticals, Inc. (“AcelRx”) and its merger
subsidiary (the “AcelRx Merger Agreement”). In connection with this
determination and in accordance with the terms of the AcelRx Merger
Agreement, the Company has given notice to AcelRx of the Amended
Melinta Proosal, the Superior Offer determination and of its
intention to consider changing its recommendation of the AcelRx
Merger Agreement or terminating the AcelRx Merger Agreement unless
AcelRx proposes revisions to the terms of the AcelRx Merger
Agreement or makes another proposal on or prior to Monday, June 1,
2020 that, if accepted, would result in the Amended Melinta
Proposal ceasing to be a Superior Offer.
Under the AcelRx Merger Agreement, as amended, Tetraphase
stockholders would receive, for each share of Tetraphase common
stock, (1) $0.2434 in cash and 0.7217 of a share of AcelRx common
stock, representing approximately $1.37 in upfront per share value,
based on the closing price of AcelRx’s common stock as of the close
of trading on May 27, 2020, in each case subject to downward
adjustment in the event that the Company’s closing net cash is less
than $5.0 million, and (2) one contingent value right (“CVR”),
which would entitle the holders to receive potential aggregate
payments of up to $14.5 million in cash upon the achievement of
certain future XERAVA™ net sales milestones starting in 2021. Based
on the closing price of AcelRx common stock on May 27, 2020, the
total upfront consideration to be received by Tetraphase
equityholders under the AcelRx Merger Agreement at closing is
valued at approximately $30.6 million, with approximately $15.9
million of this amount allocated to the Company’s outstanding
common stock warrants.
Under the Amended Melinta Proposal, Melinta has offered to
acquire Tetraphase for $34.0 million in cash, plus an additional
$16.0 million in cash potentially payable under contingent value
rights (“CVR”) to be issued in the proposed acquisition. Under the
Amended Melinta Proposal, the upfront cash consideration would be
as follows: (i) $1.52 per share of Tetraphase common stock
(including common stock underlying restricted stock units,
performance-based stock units and pre-funded warrants), (ii) $2.21
per share of Tetraphase common stock underlying the common stock
warrants issued by the Company in 2019, and (iii) $2.21 per share
of Tetraphase common stock underlying the common stock warrants
issued by the Company in 2020. In addition, the Amended Melinta
Proposal does not provide for a downward adjustment based on the
Company’s closing net cash amount. The Amended Melinta Proposal is
not subject to any financing contingencies. The definitive terms
and conditions of a merger agreement detailing the Amended Melinta
Proposal have been fully negotiated. If the Amended Melinta
Proposal continues to constitute a Superior Offer through Monday,
June 1, 2020, the Tetraphase Board will consider terminating the
AcelRx Merger Agreement and entering into the merger agreement with
Melinta.
At this time, the Tetraphase Board has not changed its
recommendation with respect to the pending transaction with AcelRx,
and the Tetraphase Board (1) continues to recommend the AcelRx
Merger Agreement to its stockholders, (2) is not modifying or
withdrawing its recommendation with respect to the AcelRx Merger
Agreement and the merger, or proposing to do so, and (3) is not
making any recommendation with respect to the Melinta proposal or
the proposed merger agreement with Melinta.
Janney Montgomery Scott LLC is acting as financial advisor to
Tetraphase and Wilmer Cutler Pickering Hale and Dorr LLP is acting
as legal advisor.
About Tetraphase Pharmaceuticals, Inc.
Tetraphase Pharmaceuticals, Inc. is a biopharmaceutical company
using its proprietary chemistry technology to develop and
commercialize novel tetracyclines for serious and life-threatening
conditions, including bacterial infections caused by many
multidrug-resistant, or MDR, bacteria. There is a medical need for
new antibiotics as resistance to existing antibiotics increases.
The company’s commercial product, XeravaTM (eravacycline), a fully
synthetic fluorocycline, is an intravenous, or IV, antibiotic that
is approved for use as a first-line empiric monotherapy for the
treatment of MDR infections, including those found in complicated
intra-abdominal infections, or cIAI.
Additional Information and Where to Find it
In connection with the
proposed transaction between Tetraphase and AcelRx, AcelRx filed
with the Securities and Exchange Commission (the “SEC”) the
Registration Statement containing a document constituting a
prospectus of AcelRx and a proxy statement of Tetraphase. The
Registration Statement was declared effective by the SEC on April
24, 2020, and Tetraphase commenced mailing the definitive proxy
statement/prospectus to stockholders of Tetraphase on April 28,
2020. Tetraphase and AcelRx also plan to file other relevant
documents with the SEC regarding the proposed transaction.
Investors and security holders are urged to read the definitive
proxy statement/prospectus and other relevant documents filed with
the SEC carefully and in their entirety because they contain
important information.
Investors and security holders
can obtain free copies of the proxy statement/prospectus and other
documents filed with the SEC by Tetraphase, AcelRx and/or Melinta
through the web site maintained by the SEC at www.sec.gov. In
addition, investors and security holders can obtain free copies of
the proxy statement/prospectus from Tetraphase by written request
to Tetraphase Pharmaceuticals, Inc., 480 Arsenal Way, Watertown,
Massachusetts 02472, Attn: Secretary or by calling (617)
715-3600.
No Offer or Solicitation
This press release does not constitute an offer to sell, or the
solicitation of an offer to buy, any securities, nor a solicitation
of any vote or approval, with respect to the proposed transaction
or otherwise. No offering of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended, and otherwise in accordance
with applicable law. If a negotiated transaction between Tetraphase
and Melinta is agreed, Tetraphase and Melinta will prepare
filing(s) related to the proposed transaction (including a tender
offer statement on Schedule TO, including an offer to purchase, a
related letter of transmittal and other tender offer documents
related to the transaction and any amendments thereto, and
Tetraphase would file a recommendation statement on Schedule 14D-9
with the SEC and any amendments thereto), and Tetraphase will
provide the filing(s) to its stockholders. Tetraphase, and possibly
Melinta, may also file other documents with the SEC regarding the
proposed transaction. This document is not a substitute for any
tender offer document or any other document which Tetraphase or
Melinta may file with the SEC in connection with the proposed
transaction. If a negotiated transaction between Tetraphase and
Melinta is agreed, investors and security holders are urged to read
the filing(s) and the other relevant materials with respect to the
proposed transaction with Melinta carefully in their entirety when
they become available before making any voting or investment
decision with respect to any proposed transaction with Melinta,
because they will contain important information about any proposed
transaction with Melinta.
Participants in the Solicitation
Tetraphase and its directors and executive officers may be
deemed to be participants in the solicitation of proxies from
Tetraphase stockholders in respect of the transactions contemplated
by the AcelRx Merger Agreement or the Melinta proposal. Information
about Tetraphase’s directors and executive officers is included in
Tetraphase’s Annual Report on Form 10-K for the year ended December
31, 2019, which was filed with the SEC on March 12, 2020. Other
information regarding the participants in the solicitation of
proxies in respect of the transactions contemplated by the AcelRx
Merger Agreement, or the transactions contemplated by the Amended
Melinta Proposal, as applicable, and a description of their direct
and indirect interests, by security holdings or otherwise, will be
contained in any registration statement, prospectus, proxy
statement and other relevant materials to be filed with the SEC if
and when they become available.
Forward-Looking Statements
Statements in this press release contain various forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements include, but
are not limited to, those regarding the transactions contemplated
by the AcelRx Merger Agreement and any proposed transaction
contemplated by Melinta, the expected timetable for completing the
transactions, future financial and operating results, benefits and
synergies of the transactions, future opportunities for the
combined company and any other statements about future
expectations, plans and prospects for Tetraphase. The words
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“intend,” “may,” “plan,” “potential,” “predict,” “project,”
“should,” “target,” “would” and similar expressions are intended to
identify forward-looking statements, although not all
forward-looking statements contain these identifying words.
The following factors, among others, could cause actual results
to differ materially from those described in these forward-looking
statements: the determinations made by the Board regarding the
Amended Melinta Proposal; actions of AcelRx or any other party in
response to any discussions with Melinta; the results of
discussions with Melinta; the impact of actions of other parties
with respect to any discussions and the potential consummation of
the proposed transactions with AcelRx or Melinta; the outcome of
any legal proceedings that could be instituted against Tetraphase
or its directors related to the discussions, the Amended Melinta
Proposal or the AcelRx Merger Agreement; changes in the proposal
from Melinta; the risk that the transactions contemplated by the
AcelRx Merger Agreement or the Amended Melinta Proposal may not be
completed in a timely manner, or at all, which may adversely affect
Tetraphase’s business and the price of its common stock; the
failure to satisfy all of the closing conditions of the
transactions contemplated by the AcelRx Merger Agreement, including
the approval of the AcelRx Merger Agreement by Tetraphase’s
stockholders, or with respect to any definitive agreements for the
Amended Melinta Proposal; the occurrence of any event, change or
other circumstance that could give rise to the termination of the
AcelRx Merger Agreement; the effect of the announcement or pendency
of the transactions contemplated by the AcelRx Merger Agreement or
the definitive agreements for the Amended Melinta Proposal on
Tetraphase’s business, operating results, and relationships with
customers, suppliers, competitors and others; risks that the
transactions contemplated by the AcelRx Merger Agreement or the
Amended Melinta Proposal may disrupt Tetraphase’s current plans and
business operations; risks related to the diverting of management’s
attention from Tetraphase’s ongoing business operations; the
outcome of any legal proceedings that may be instituted against
Tetraphase related to the AcelRx Merger Agreement or the
transactions contemplated by the AcelRx Merger Agreement or the
Amended Melinta Proposal or the transactions contemplated thereby;
risks relating to Tetraphase’s ability to successfully
commercialize Xerava; concerns with or threats of, or the
consequences of, pandemics, contagious diseases or health
epidemics, including COVID-19; general economic and market
conditions and the risk factors set forth under the caption “Risk
Factors” in Tetraphase’s Quarterly Report on Form 10-Q for the
period ended March 31, 2020 filed with the SEC on May 7, 2020 and
in any other subsequent filings made by Tetraphase with the SEC.
Any forward-looking statements contained in this press release
speak only as of the date hereof, and Tetraphase specifically
disclaims any obligation to update any forward-looking statements,
whether as a result of new information, future events or
otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20200527005963/en/
Media and Investors: Argot Partners Maeve Conneighton
212-600-1902 maeve@argotpartners.com
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