La Jolla Pharmaceutical Company (Nasdaq: LJPC), which is dedicated
to the development and commercialization of innovative therapies
that improve outcomes in patients suffering from life-threatening
diseases, and Tetraphase Pharmaceuticals, Inc. (Nasdaq: TTPH), a
biopharmaceutical company focused on commercializing its novel
tetracycline XERAVA™ to treat serious and life-threatening
infections, today announced that they have entered into a
definitive merger agreement. Under the terms of the definitive
merger agreement, La Jolla would acquire Tetraphase, through a
tender offer, for $43.0 million in upfront cash plus potential
future cash payments of up to $16.0 million pursuant to contingent
value rights (CVRs). The Board of Directors of Tetraphase
unanimously recommends that stockholders tender their shares in the
La Jolla tender offer once it is commenced.
Under the terms of the definitive merger agreement,
the upfront cash consideration in the transaction will be as
follows: (i) $2.00 per share of Tetraphase common stock (including
common stock underlying restricted stock units, performance-based
stock units and pre-funded warrants); (ii) $2.68 per share of
Tetraphase common stock underlying the common stock warrants issued
by Tetraphase in November 2019; and (iii) $2.69 per share of
Tetraphase common stock underlying the common stock warrants issued
by Tetraphase in January 2020. Tetraphase equity holders would also
be entitled to receive, for each share of Tetraphase common stock,
one non-tradeable CVR. The holders of the CVRs would be entitled to
receive payments of up to an additional $16.0 million in the
aggregate upon the achievement of certain net sales of XERAVA™ in
the United States (U.S.) as follows: (i) $2.5 million if 2021
XERAVA U.S. net sales are ≥ $20 million; (ii) $4.5 million if
XERAVA U.S. net sales are ≥ $35 million during any calendar year
ending on or prior to December 31, 2024; and (iii) $9.0 million if
XERAVA U.S. net sales are ≥ $55 million during any calendar year
ending on or prior to December 31, 2024.
“Combining with La Jolla, which markets GIAPREZA, the first new
treatment for patients suffering from septic or other distributive
shock in more than a decade, should help accelerate XERAVA’s
availability to patients in need,” said Larry Edwards,
President and Chief Executive Officer of Tetraphase. “We are
excited to have the opportunity to combine with a company that has
a strategic vision similar to our own.”
“We commend Tetraphase on its successful commercial
launch of XERAVA, an important new treatment for patients suffering
from serious infections,” said Kevin Tang, Chairman of La Jolla.
“By increasing our presence in the hospital with a second
innovative therapy, we look forward to better serving the needs of
patients suffering from life-threatening diseases.”
Under the terms of the definitive merger agreement,
the tender offer will commence within three business days. Any
shares not tendered in the tender offer will be acquired in a
second-step merger at the same cash price as paid in the tender
offer. Closing of the transaction is subject to specified closing
conditions, including that a majority of Tetraphase’s shares of
common stock (treating the shares underlying Tetraphase’s RSUs and
PRSUs as outstanding) are validly tendered and not validly
withdrawn. Upon the closing of the transactions, Tetraphase will
become a wholly owned subsidiary of La Jolla, and shares of
Tetraphase’s common stock will no longer be listed on any public
market. Subject to certain limited exceptions, the CVRs will be
non-transferable.
The transaction was unanimously approved by the
Tetraphase board of directors and is expected to close in the third
quarter of 2020. Certain Tetraphase stockholders and warrant
holders, including Armistice Capital, LLC, holding in the aggregate
approximately 20% of Tetraphase’s outstanding voting power, have
signed support agreements or exchange agreements under which such
equity holders agreed, among other things, to tender their shares
in the tender offer and to the treatment of the warrants described
above. Additionally, La Jolla owns shares in Tetraphase that
represent approximately 15% of Tetraphase’s outstanding voting
power.
On June 24, 2020, Tetraphase terminated its
previously announced merger agreement with Melinta Therapeutics,
Inc., dated as of June 4, 2020, in order to enter into the
definitive merger agreement with La Jolla. In connection with the
termination of the definitive merger agreement with Melinta,
Tetraphase paid Melinta a termination fee in the amount of
$1,150,000.
Janney Montgomery Scott is acting as financial
advisor to Tetraphase and has rendered a fairness opinion to
Tetraphase’s board of directors in connection with the transaction.
Wilmer Cutler Pickering Hale and Dorr LLP is acting as legal
advisor to Tetraphase in connection with the transaction.
About GIAPREZA
In December 2017, GIAPREZA™ (angiotensin II) was approved by the
U.S. Food and Drug Administration (FDA) as a vasoconstrictor
indicated to increase blood pressure in adults with septic or other
distributive shock. In August 2019, GIAPREZA was approved by the
European Commission (EC) for the treatment of refractory
hypotension in adults with septic or other distributive shock who
remain hypotensive despite adequate volume restitution and
application of catecholamines and other available vasopressor
therapies. GIAPREZA mimics the body’s endogenous angiotensin II
peptide, which is central to the renin-angiotensin-aldosterone
system, which in turn regulates blood pressure. Prescribing
information for GIAPREZA is available at www.giapreza.com. The
European Summary of Product Characteristics is available on the EMA
website: www.ema.europa.eu/en/medicines/human/EPAR/giapreza.
GIAPREZA is marketed in the U.S. by La Jolla Pharmaceutical Company
on behalf of La Jolla Pharma, LLC, its wholly owned subsidiary.
GIAPREZA Important Safety Information
Contraindications
None.
Warnings and Precautions
There is a potential for venous and arterial thrombotic and
thromboembolic events in patients who receive GIAPREZA. Use
concurrent venous thromboembolism (VTE) prophylaxis.
Adverse Reactions
The most common adverse reactions that were reported in greater
than 10% of GIAPREZA-treated patients were thromboembolic
events.
Drug Interactions
Angiotensin converting enzyme (ACE) inhibitors may increase
response to GIAPREZA. Angiotensin II receptor blockers (ARBs) may
reduce response to GIAPREZA.
You are encouraged to report negative side effects of
prescription drugs to the FDA. Visit www.fda.gov/medwatch or call
1-800-FDA-1088.
For additional information, please see Full Prescribing
Information for the United States and the Summary of Product
Characteristics for the European Union.
About XERAVA
XERAVA (eravacycline for injection) is a novel fluorocycline of
the tetracycline class antibacterials indicated for the treatment
of complicated intra-abdominal infections (cIAI) in patients 18
years of age and older. XERAVA was investigated for the treatment
of cIAI as part of Tetraphase's IGNITE (Investigating Gram-Negative
Infections Treated with Eravacycline) Phase 3 program. In the first
pivotal Phase 3 trial in patients with cIAI, twice-daily
intravenous (IV) XERAVA met the primary endpoint by demonstrating
statistical non-inferiority of clinical response compared to
ertapenem and was well-tolerated. In the second Phase 3 clinical
trial in patients with cIAI, twice-daily IV XERAVA met the primary
endpoint by demonstrating statistical non-inferiority of clinical
response compared to meropenem and was well-tolerated. In both
trials, XERAVA achieved high cure rates in patients with
Gram-negative pathogens, including resistant isolates.
XERAVA Important Safety Information
XERAVA is a tetracycline class antibacterial indicated for the
treatment of complicated intra-abdominal infections in patients 18
years of age and older.
XERAVA is not indicated for the treatment of complicated urinary
tract infections.
To reduce the development of drug-resistant bacteria and
maintain the effectiveness of XERAVA and other antibacterial drugs,
XERAVA should be used only to treat or prevent infections that are
proven or strongly suspected to be caused by susceptible
bacteria.
XERAVA is contraindicated for use in patients with known
hypersensitivity to eravacycline, tetracycline-class antibacterial
drugs or to any of the excipients. Life-threatening
hypersensitivity (anaphylactic) reactions have been reported with
XERAVA.
The use of XERAVA during tooth development (last half of
pregnancy, infancy and childhood to the age of eight years) may
cause permanent discoloration of the teeth (yellow-gray-brown) and
enamel hypoplasia.
The use of XERAVA during the second and third trimester of
pregnancy, infancy and childhood up to the age of eight years may
cause reversible inhibition of bone growth.
Clostridium difficile associated diarrhea (CDAD) has been
reported with use of nearly all antibacterial agents and may range
in severity from mild diarrhea to fatal colitis.
The most common adverse reactions observed in clinical trials
(incidence ≥ 3%) were infusion site reactions, nausea and
vomiting.
XERAVA is structurally similar to tetracycline-class
antibacterial drugs and may have similar adverse reactions. Adverse
reactions including photosensitivity, pseudotumor cerebri and
anti-anabolic action, which has led to increased blood urea
nitrogen, azotemia, acidosis, hyperphosphatemia, pancreatitis and
abnormal liver function tests, have been reported for other
tetracycline-class antibacterial drugs, and may occur with XERAVA.
Discontinue XERAVA if any of these adverse reactions are
suspected.
To report SUSPECTED ADVERSE REACTIONS, contact
Tetraphase Pharmaceuticals Inc., at 1-833-7-XERAVA (1-833-793-7282)
or FDA at 1‑800‑FDA-1088 or
www.fda.gov/medwatch.
Please see full prescribing information for XERAVA.
About La Jolla Pharmaceutical Company
La Jolla Pharmaceutical Company is dedicated to the development
and commercialization of innovative therapies that improve outcomes
in patients suffering from life-threatening diseases. In December
2017, GIAPREZA™ (angiotensin II) was approved by the U.S. Food and
Drug Administration (FDA) as a vasoconstrictor indicated to
increase blood pressure in adults with septic or other distributive
shock. In August 2019, GIAPREZA was approved by the European
Commission (EC) for the treatment of refractory hypotension in
adults with septic or other distributive shock who remain
hypotensive despite adequate volume restitution and application of
catecholamines and other available vasopressor therapies. For more
information, please visit www.ljpc.com.
About Tetraphase Pharmaceuticals, Inc.
Tetraphase Pharmaceuticals, Inc., is a biopharmaceutical company
using its proprietary chemistry technology to create novel
tetracyclines for serious and life-threatening conditions,
including infections caused by many of the multidrug-resistant
bacteria highlighted as urgent public health threats by
the World Health Organization and the Centers for
Disease Control and Prevention. Tetraphase has created more than
3,000 novel tetracycline compounds using its proprietary technology
platform. Tetraphase's lead product, XERAVA™, is approved for the
treatment of complicated intra-abdominal infections by
the U.S. Food and Drug Administration and
the European Commission. Tetraphase’s pipeline also includes
antibiotics TP-271 and TP-6076, which are Phase 2 ready, and
TP‑2846, which is in preclinical testing for acute myeloid
leukemia. Tetraphase intends to out license its pipeline
candidates. Please visit www.tphase.com for more company
information.
Important Information for Stockholders of Tetraphase
Pharmaceuticals, Inc.
The tender offer for the outstanding shares of Tetraphase
referenced in this document has not yet commenced. This document is
for informational purposes only and is neither an offer to purchase
nor a solicitation of an offer to sell shares, nor is it a
substitute for the tender offer materials that La Jolla and its
subsidiary will file with the Securities and Exchange Commission
(SEC). At the time the tender offer is commenced, La Jolla and its
subsidiary will file tender offer materials on Schedule TO, and,
thereafter, Tetraphase will file a Solicitation/Recommendation
Statement on Schedule 14D-9 with the SEC with respect to the tender
offer. THE TENDER OFFER MATERIALS (INCLUDING AN OFFER TO PURCHASE,
A RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER TENDER OFFER
DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT WILL
CONTAIN IMPORTANT INFORMATION. HOLDERS OF SHARES OF TETRAPHASE
COMMON STOCK ARE URGED TO READ THESE DOCUMENTS CAREFULLY WHEN THEY
BECOME AVAILABLE (AS EACH MAY BE AMENDED OR SUPPLEMENTED FROM TIME
TO TIME) BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION THAT
HOLDERS OF SHARES OF TETRAPHASE COMMON STOCK SHOULD CONSIDER BEFORE
MAKING ANY DECISION REGARDING TENDERING THEIR SHARES. The Offer to
Purchase, the related Letter of Transmittal and certain other
tender offer documents, as well as the Solicitation/Recommendation
Statement, will be made available to all holders of shares of
Tetraphase common stock at no expense to them. The tender offer
materials and the Solicitation/Recommendation Statement will be
made available for free at the SEC’s website at www.sec.gov.
Additional copies of the tender offer materials may be obtained for
free by contacting La Jolla Pharmaceutical Company at 4550 Towne
Centre Court, San Diego, California 92121, Attention: Chief
Financial Officer. In addition to the Offer to Purchase, the
related Letter of Transmittal and certain other tender offer
documents, as well as the Solicitation/Recommendation Statement, La
Jolla and Tetraphase file annual, quarterly and current reports and
other information with the SEC.
Forward-looking Statements
Statements in this press release regarding the proposed
transactions between La Jolla and Tetraphase, the expected timeline
for completing the transactions, future financial and operating
results and benefits of the transaction, future opportunities for
the combined company and any other statements about future
expectations, beliefs, goals, plans or prospects constitute
forward‑looking statements. Any statements that are not statements
of historical fact (including statements containing “believes,”
“anticipates,” “plans,” “expects,” “may,” “will,” “would,”
“intends,” “estimates” and similar expressions) should also be
considered to be forward‑looking statements. There are a number of
important factors that could cause actual results or events to
differ materially from those indicated by such forward‑looking
statements, including: the risk that the proposed transactions may
not be completed in a timely manner, or at all; the failure to
satisfy all of the closing conditions of the proposed transactions;
the occurrence of any event, change or other circumstance that
could give rise to the termination of the merger agreement and the
tender offer thereunder; the effect of the announcement or pendency
of the proposed transactions on both La Jolla’s and Tetraphase’s
businesses, operating results and relationships with customers,
suppliers, competitors and others; the risk that the proposed
transactions may disrupt La Jolla’s and Tetraphase’s current plans
and business operations; potential difficulties retaining employees
as a result of the proposed transactions; risks related to the
diverting of management’s attention from La Jolla’s and
Tetraphase’s ongoing business operations; the outcome of any legal
proceedings that may be instituted against Tetraphase related to
the merger agreement or the tender offer thereunder; and risks
discussed in the “Risk Factors” section of Tetraphase’s quarterly
report on Form 10-Q for the period ended March 31, 2020. In
addition, the forward-looking statements included in this press
release represent La Jolla’s and Tetraphase’s views as of June 24,
2020. It is anticipated that subsequent events and developments
will cause views to change. However, while it may be elected to
update these forward-looking statements at some point in the
future, both La Jolla and Tetraphase specifically disclaim any
obligation to do so. These forward-looking statements should not be
relied upon as representing La Jolla’s and Tetraphase’s views as of
any later date.
La Jolla Pharmaceutical Company Contact:Michael
HearneChief Financial OfficerLa Jolla Pharmaceutical Company(858)
333-5769mhearne@ljpc.com
Tetraphase Pharmaceuticals, Inc.
Contact: Argot PartnersMaeve Conneighton(212)
600-1902maeve@argotpartners.com
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