US based Acasti Pharma Inc has signed an agreement to acquire Grace Therapeutics, a privately held emerging biopharmaceutical company focused on developing innovative drug delivery technologies for the treatment of rare and orphan diseases. After completion of the deal, Acasti would own 55% of the combined company on a pro forma basis and Grace would hold the remaining 45%.
Acasti will acquire Grace’s “pipeline of rare and orphan disease programs, including 3 clinical stage assets that have received Orphan Drug Designation from the US Food & Drug Administration," according to the Hyderabad and New Jersey-based company.
“It is anticipated that the cash at closing of about $64 million will be principally used to pursue the clinical development of the first two assets through Phase 3 and further advance earlier pipeline assets into the clinic," the filing mentioned. Grace’s three lead programs have all received Orphan Drug Designation1 from the US Food & Drug Administration (FDA), which could provide up to seven years of marketing exclusivity in the United States upon FDA’s approval of the New Drug Application (NDA), provided that certain conditions are met.
“The proposed transaction has been approved by the boards of directors of both companies and is supported by Grace shareholders through voting and lock-up agreements with the company," it further added.
The valaution of the deal would be at around $138 million, according to reports.
Grace Therapeutics is an emerging biopharmaceutical company focused on rare and orphan diseases with high unmet medical needs. Grace’s strategy is to improve clinical outcomes using novel drug delivery technologies to approved pharmaceutical compounds and achieve enhanced efficacy, faster onset of action, reduced side effects, convenient delivery, and increased patient compliance.
Commenting on the deal, Roddy Carter, chairman of Acasti said, “We believe that combining Grace’s innovative research programs and scientific talent with Acasti’s financial resources and drug development and commercialization expertise position us to build a portfolio of innovative therapeutics that will address unmet medical needs. The Acasti and Grace boards have approved this transaction, which is also supported by Grace shareholders, and we highly recommend that our shareholders also approve it.”
Vimal Kavuru, co-founder and chairman of Grace, noted, “Merging with Acasti is a significant opportunity for Grace, as it allows us to partner with an experienced team, well-versed in drug development and commercialization, with a strong commitment to the highest standards of corporate governance."
“As a result of the merger, we anticipate the combined company will have the financial resources to fund our lead programs to critical value inflection points. Our board of directors have approved the proposed transaction with Acasti, which is also supported by Grace’s shareholders,” he added.