Sector News

Resverlogix gets a $116M China drug development deal, stokes buyout buzz

April 29, 2015
Life sciences
Resverlogix has struck a deal to trade development rights in China for its lead cardio drug in exchange for a $41.5 million equity stake in the biotech along with up to $75 million in sales milestones. And today the Canadian biotech’s CEO added a sweetener, telling Bloomberg that he’s in talks with unnamed suitors to sell the company.
 
In what is becoming an increasingly familiar framework for a biotech deal, Shenzhen Hepalink Pharmaceutical acquired rights to develop RVX-208 for China, Hong Kong, Taiwan and Macau. Hepalink, which is based in the Shenzhen High-Tech Park, is paying $29 million for 12.7% of the company while Eastern Capital is adding $12.5 million, boosting its stake in Resverlogix to 24%. Resverlogix’s statement concludes that if you add in a potential royalty stream, the company stands to earn more than $332 million in future revenue off the deal, if everything works as planned.  
 
The company’s shares surged a modest 6% today as news of the claimed sales talks spread.
 
“We are in discussions with multiple companies, not just one,” CEO Donald McCaffrey told Bloomberg, tossing his hat into a crowded ring of M&A speculation. Buyout deals have become all the rage in the industry, and a steady stream of prospective M&A deals and rumors has kept analysts buzzing.
 
Resverlogix has almost all of its eggs in the RVX-208 basket, aiming at a new treatment for atherosclerosis. It’s a small molecule that inhibits BET bromodomains by boosting levels of the ApoA-I protein, which in turn make high-density lipoprotein particles that can flush plaque.
 
Last summer the small biotech touted evidence of a reduction in major cardiovascular events among diabetes patients in two studies. That news came a year after Resverlogix’s Phase IIb trial for the drug ended in failure, wiping out most of its share value and forcing the company to go into survival mode.
 
By John Carroll
 

Related News

February 21, 2021

Sanofi invests in health tech firm Novadiscovery, boosting trial simulation platform and COVID-19 work

Life sciences

Novadiscovery uses its so-called JINKO platform that runs disease models on virtual patients to support decision-making and de-risk clinical development.

February 21, 2021

Gilead lets local HIV community groups take the lead with $3M grant

Life sciences

The pharma is pledging $3.2 million over two years to the Human Rights Campaign, the largest lesbian, gay, bisexual, transgender and queer (LGBTQ+) civil rights organization in the U.S.

February 21, 2021

Biotech company funds research project on diversity

Life sciences

In collaboration with Genmab, a new anthropological postdoc project at the Department of Anthropology will now explore and help develop the company’s efforts to ensure a diverse and inclusive workplace.

Send this to a friend