Tobira Therapeutics will join Regado Biosciences to create a combined company focused on developing new treatments for liver and inflammatory diseases, anchored by its Phase IIb lead compound cenicriviroc (CVC).

While the merger price was not disclosed, a Tobira syndicate has committed to investing $22 million in the combined company concurrently with the merger. All of Tobira's preferred stock investors, including Domain Associates, Novo Ventures, Frazier Healthcare, Montreux Equity Partners, and Canaan Partners, have committed to participate in the financing. The financing would raise the combined company’s cash balance to approximately $60 million.

Tobira says the combined funding will enable it to carry out its Phase II clinical program for CVC, an immunomodulator and antifibrotic agent now being studied in patients with non-alcoholic steatohepatitis (NASH) and liver fibrosis in the Phase IIb CENTAUR trial.

CENTAUR is a randomized, double-blind study of a single 150 mg tablet of CVC given once daily versus placebo in patients with NASH and liver fibrosis. The study will enroll approximately 250 patients and will evaluate the non-alcoholic fatty liver disease (NAFLD) activity score (NAS) and resolution of NASH without worsening of liver fibrosis after one and two years of treatment as compared to placebo.

CENTAUR is an international study with planned treatment centers across North America, Europe, Hong Kong, and Australia. Topline data from CENTAUR is expected to be released in the second quarter of 2016.

Tobira believes CVC has potential to reduce liver inflammation and slow down or reverse progression of liver fibrosis or progression to cirrhosis.

“The merger and concurrent financing will allow the company to fully fund Tobira's ongoing Phase IIb CENTAUR study,” of CVC in patients with NASH and liver fibrosis,” Laurent Fischer, M.D., Tobira’s chairman and CEO, said in a statement.

“The strong closing balance sheet allows us to expand our NASH program with additional studies of CVC in non-alcoholic fatty liver disease and combination settings that will help position CVC as a cornerstone therapy for this troubling complication of the ongoing obesity epidemic,” Dr. Fischer added.

Dr. Fischer will lead the combined company, which will be formed through Tobira’s merger with a subsidiary of Regado. The new company will be headquartered in San Francisco, where Tobira is now based, and its board will be headed by Regado's current board chairman Dennis Podlesak.

“We are optimistic that the strength of the leadership team, coupled with the cash Regado will contribute to the merger, will enable CVC to reach significant value inflections in the near term,” added Michael A. Metzger, Regado's president and CEO. “We expect Tobira to be the next breakout company in NASH based on the best-in-class profile and potential of their lead drug CVC.”

Regado is looking to bounce back from the setback it suffered in August when it terminated development of its then-lead program, the anticoagulant candidate Revolixys™ Kit. The company halted its REGULATE-PCI Phase III study on the advice of the trial’s Data and Safety Monitoring Board, which raised concerns over the frequency and severity of “serious allergic adverse events associated with Revolixys.”

In September, Regado announced it laid off 60% of its workforce—20 employees—and launched efforts to evaluate strategic alternatives.

Regado’s merging into Tobira comes five months after Tobira backed away from earlier plans to raise up to $64 million—about 4.6 million shares at between $12 and $14 each—through an initial public offering. The company reversed course on its IPO in August as the red-hot stock market cooled for biotechs.

The merger is the second M&A deal this month centered around treatments for NASH. On January 6, Gilead Sciences disclosed plans to acquire Phenex Pharmaceuticals’ Farnesoid X Receptor (FXR) program, consisting of small molecule FXR agonists designed to treat NASH and other liver diseases. Phenex could receive up to $470 million in upfront and development milestone payments.

According to Tobira, the oral, once daily, first-in-class dual CCR2/CCR5 antagonist has shown in clinical trials its ability to bind to targets in both the CCR2 and CCR5 pathways targets, which play a key role in the cycle of inflammation and fibrosis. CVC's safety and tolerability profile has been evaluated in some 580 patients dosed in Phase I and Phase II trials, including 115 HIV-1 infected subjects who received treatment for up to 48 weeks.

Tobira reasons that CVC may be a potential treatment for fibrosis—as well as HIV-1, whose multitargeted combination treatment approaches may serve as a model for managing NASH.

The boards of directors of both companies have approved the merger, which is expected to close in the second quarter this year subject to approval by stockholders of each company and other customary conditions.

Current Tobira shareholders will own approximately 68% of the combined company, with the remaining 32% to be held by current Regado shareholders.

“Following an extensive and thorough review of strategic alternatives, we believe the proposed merger with Tobira provides the opportunity for substantial returns for Regado shareholders,” Metzger added.








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