- Acquisition positions Melinta as durable and
focused pure-play antibiotics company with four marketed products:
Baxdela®, Vabomere®, Orbactiv®, and Minocin IV® -
Melinta Therapeutics, Inc. (NASDAQ:MLNT), a commercial-stage
company developing and commercializing novel antibiotics to treat
serious bacterial infections, today announced that Melinta and The
Medicines Company (NASDAQ:MDCO) have entered into an agreement
pursuant to which Melinta will acquire the infectious disease
business from The Medicines Company. This includes three
marketed products: recently approved and launched Vabomere
(vaborbactam/meropenem), and established commercial products
Orbactiv (oritavancin) and Minocin IV (minocycline).
The acquisition was unanimously approved by
Melinta’s board of directors and is expected to close in the first
quarter of 2018, subject to satisfaction of customary closing
conditions, including Melinta stockholder approval. Melinta
believes that the acquisition will result in a focused portfolio of
high-value marketed assets with significant commercial synergies,
allowing Melinta to maximize the value associated with the marketed
products and drive the company to profitability. It also bolsters
Melinta’s commercial team, which has been built out in preparation
for the launch of Baxdela (delafloxacin), with experienced
anti-infective professionals from The Medicines Company who can
drive value across the combined portfolio.
“The assets we are purchasing are an ideal
complement to our existing business, allowing us to focus on
multiple valuable segments of the anti-infectives market
simultaneously,” stated Dan Wechsler, Melinta’s president and chief
executive officer. “We will be able to better serve the
providers and the patients they serve who need medicines for
serious infections by delivering a robust portfolio of treatment
options.”
“We believe the transaction announced today
places our novel antibiotic products and many of our outstanding
employees, into the Melinta organization, a highly-capable,
pure-play, emerging leader in the antibiotics space. We believe
Melinta will grow these products strongly and – as both partner and
shareholder -- we look forward to their success as we focus our
efforts and resources on inclisiran, which we believe has the
potential to be a competitively-dominant, blockbuster product for
the millions of at-risk, often non-adherent, patients worldwide who
continue to struggle with high cholesterol given the limitations of
available therapies,” said Clive Meanwell, M.D., Ph.D., chief
executive officer of The Medicines Company.
The acquisition includes the purchase of global
rights for three marketed products and the business supporting
those products. Recently launched Vabomere is a novel
fixed-dose combination agent comprising vaborbactam, a
beta-lactamase inhibitor, and meropenem, the leading
carbapenem. Vabomere was approved by the U.S. Food & Drug
Administration (FDA) after priority review in August 2017 and is
indicated for the treatment of adult patients with complicated
urinary tract infections (cUTI) including pyelonephritis caused by
designated susceptible Enterobacteriaceae. Vabomere’s Phase 3 TANGO
II trial, a randomized trial comparing Vabomere to the best
available therapy for the treatment of serious carbapenem-resistant
Enterobacteriaceae (CRE) infections, was stopped early by an
Independent Data and Safety Monitoring Board following a
risk-benefit analysis of available data which was in favor of
Vabomere. Vabomere’s Marketing Authorization Application is
currently under regulatory review by the European Medicines Agency
(EMA) for cUTI.
Orbactiv is an injectable product approved by
the FDA and EMA for the treatment of adults with acute bacterial
skin and skin structure infections (ABSSSI) caused by susceptible
designated gram-positive bacteria including
methicillin-resistant Staphylococcus aureus (MRSA).
Minocin IV, an injectable product, is a tetracycline
derivative approved in the U.S. for the treatment of infections due
to susceptible strains of several important designated
gram-positive and gram-negative pathogens, including infections due
to Acinetobacter species, which typically occur in hospitalized
patients.
Vabomere and Orbactiv were granted priority
review and approval as Qualified Infectious Disease Products (QIDP)
by the FDA in accordance with the Generating Antibiotics Incentives
Now (GAIN) Act, which secured five-year regulatory extensions of
exclusivity for each product.
Through this acquisition, Melinta will enhance
its commercial portfolio, led by Baxdela, a novel fluoroquinolone
antibiotic recently approved by the FDA for the treatment of
patients with ABSSSI and launching in Q1 2018. Baxdela is
differentiated from other therapies currently available, since
therapy can be initiated on either IV or oral formulations, has
full coverage of gram positive pathogens, including MRSA, and gram
negative pathogens, has tolerability and fixed dose simplicity, and
has limited drug and disease interactions. Once the acquisition
closes, Melinta will have a portfolio of four complementary
marketed antibiotic assets: Baxdela, recently launched
Vabomere, and established commercial products, Orbactiv and Minocin
IV.
More than 14 million patients in the U.S.
are treated for ABSSSI on an annual basis. While the majority of
these patients are treated successfully in the community, many
patients will require treatment in emergency departments and urgent
care centers on an outpatient basis (estimated by Melinta to be 1.6
million), and a significant portion will receive treatment as
hospital inpatients (2.9 million).
The rise in CRE was formally recognized as an
urgent threat by the Centers for Disease Control and Prevention in
2013. Melinta estimates that ~138,000 patients are candidates
for antibiotic therapy that targets carbapenem resistance.
Patients with CRE infections are at increased risk of poor
outcomes, including extended hospital stays, higher rates of
mechanical ventilation, higher treatment cost, and death.
Acinetobacter is a genus of gram-negative
bacteria belonging to the Moraxcellaceae family. According to
the CDC, 63 percent of Acinetobacter infections are multi-drug
resistant, meaning that they are resistant to three or more classes
of antibiotics. Melinta estimates that there are approximately
50,000 cases of multi-drug resistant Acinetobacter infections per
year.
The combined Melinta and The Medicines Company
infectious disease product portfolio significantly enhances
Melinta’s multi-channel strategy of delivering antibiotic solutions
for ABSSSI and gram-negative infections within the hospital,
emergency department, and community settings. Each product in
the portfolio has distinct value in the marketplace. With
Melinta’s commercial team now built out and preparing for Baxdela’s
launch, coupled with the professionals that will join from The
Medicines Company, Melinta will have an experienced team of focused
antibiotic experts as well as the therapeutic scale necessary to
maximize the value of the portfolio.
Melinta will continue to progress the additional
clinical studies designed to enhance and expand the potential for
the four marketed products, and fund the discovery and development
of its novel class of antibiotics via the ESKAPE (Enterococcus
faecium, Staphylococcus aureus, Klebsiella pneumoniae,
Acinetobacter baumannii, Pseudomonas aeruginosa, Enterobacter
species and Escherichia coli) pathogen program. Outside the
U.S., Melinta retains global rights to the acquired products.
Melinta will continue ongoing regulatory discussions with the
European Medicines Agency for the approval of Vabomere, and pursue
ex-U.S. partnering opportunities with the now even more compelling
suite of treatment options.
Deal Structure and Financing
Under the terms of the acquisition agreement,
the purchase price consists of (i) a payment by Melinta to The
Medicines Company of $165 million in cash and the issuance to The
Medicines Company of a number of shares of Melinta common stock
equal to $50 million, divided by 90% of the volume weighted average
price for the trailing 10 trading day period ending 3 trading days
prior to closing; (ii) a payment by Melinta to The Medicines
Company of $25 million following each of the twelve and eighteen
month anniversaries of the closing date, and (iii) payment by
Melinta to The Medicines Company of certain royalty payments, based
on tiered net sales of the acquired products in certain
jurisdictions. Funding for this acquisition will be provided
through both debt and equity. In conjunction with the closing
of the acquisition, Melinta will enter into a Loan and Security
Agreement with Deerfield Management Company, L.P.
(“Deerfield”). Deerfield and certain funds managed by
Deerfield will initially provide a total of $190 million in debt
and equity financing. An additional $50 million of debt is
available to Melinta within 24 months of the acquisition close upon
the achievement of certain sales thresholds. In addition to
the funding from Deerfield, certain investors are committed to make
a $30 million equity investment at closing. These funds will
be used to fund the initial cash acquisition price of $165 million
and to retire existing company debt of $40 million.
Additional information on the acquisition and related financing
will be contained in the proxy statement related to the proposed
transactions. Melinta stockholders holding approximately 52%
of the outstanding common stock have executed voting agreements
agreeing to vote their shares in favor of the transaction.
Willkie Farr & Gallagher LLP served as legal
counsel to Melinta with respect to the transaction.
Conference Call and Webcast
Melinta management will host a webcast and
conference call regarding this announcement at 7:45 a.m. ET today.
The live call may be accessed by dialing 877-377-7553 for domestic
callers and 253-237-1151 for international callers and using
conference ID # 8898769. A live webcast of the call will be
available online from the investor relations section of the company
website at www.melinta.com and will be archived there for 30 days.
A telephone replay of the call will be available by dialing
855-859-2056 for domestic callers or 404-537-3406 for international
callers and entering the conference ID # 8898769.
About Melinta Therapeutics
Melinta Therapeutics, Inc. is dedicated to saving lives threatened
by the global public health crisis of bacterial infections, through
the development and commercialization of novel antibiotics that
provide new and better therapeutic solutions. Melinta’s lead
product is Baxdela, an antibiotic approved by the U.S. FDA for use
in the treatment of acute bacterial skin and skin structure
infections (ABSSSI). Melinta also has an extensive pipeline of
preclinical and clinical stage products representing many important
classes of antibiotics, each targeted at a different segment of the
anti-infective market. Together, this pipeline provides
Melinta with the unique ability to provide providers and patients
with a range of solutions that can meet the tremendous need for
novel antibiotics treating serious infections. Visit
www.melinta.com for more information.
Cautionary Note Regarding Forward-Looking
Statements
Certain statements in this communication constitute
“forward-looking statements” within the meaning of Section 27A of
the Securities Act and Section 21E of the Securities Exchange Act
and are usually identified by the use of words such as
“anticipates,” “believes,” “estimates,” “expects,” “intends,”
“may,” “plans,” “projects,” “seeks,” “should,” “will,” and
variations of such words or similar expressions. We intend these
forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements contained in Section 27A
of the Securities Act and Section 21E of the Securities Exchange
Act and are making this statement for purposes of complying with
those safe harbor provisions. These forward-looking statements
reflect our current views about our plans, intentions,
expectations, strategies and prospects, which are based on the
information currently available to us and on assumptions we have
made. Although we believe that our plans, intentions, expectations,
strategies and prospects as reflected in or suggested by those
forward-looking statements are reasonable, we can give no assurance
that the plans, intentions, expectations or strategies will be
attained or achieved. Furthermore, actual results may differ
materially from those described in the forward-looking statements
and will be affected by a variety of risks and factors that are
beyond our control.
Risks and uncertainties for Melinta include, but are not limited
to: inability to complete the proposed transactions; liquidity and
trading market for shares prior to and following the consummation
of the proposed transactions; costs and potential litigation
associated with the proposed transactions; failure or delay in
obtaining required approvals by governmental or quasi-governmental
entity necessary to consummate the proposed transactions; failure
to satisfy other conditions to the closing of the proposed
transactions; risks related to the costs, timing and regulatory
review of the Company’s studies and clinical trials, including its
ability to address the issues identified by the FDA in the complete
response letter relating to Melinta’s new drug applications for
solithromycin for community acquired bacterial pneumonia;
uncertainties in obtaining successful clinical results for product
candidates and unexpected costs that may result therefrom;
inability or the delay in obtaining required regulatory approvals
for product candidates, which may result in unexpected cost
expenditures; failure to realize any value of certain product
candidates developed and being developed, in light of inherent
risks and difficulties involved in successfully bringing product
candidates to market; inability to develop new product candidates
and support existing products; inability to commercialize and
launch any product candidate that receives regulatory approval,
including Baxdela; the Company’s anticipated capital expenditures,
its estimates regarding its capital requirements and its need for
future capital; uncertainties of cash flows and inability to meet
working capital needs; cost reductions that may not result in
anticipated level of cost savings or cost reductions prior to or
after the consummation of the proposed transactions; the approval
by the FDA and EMA and any other similar foreign regulatory
authorities of other competing or superior products brought to
market; risks resulting from unforeseen side effects; risk that the
market for the Company’s products may not be as large as expected;
inability to obtain, maintain and enforce patents and other
intellectual property rights or the unexpected costs associated
with such enforcement or litigation; inability to obtain and
maintain commercial manufacturing arrangements with third party
manufacturers or establish commercial scale manufacturing
capabilities; loss of or diminished demand from one or more key
customers or distributors; unexpected cost increases and pricing
pressures; the possibility of economic recession and its negative
impact on customers, vendors or suppliers; and risks associated
with the possible failure to realize certain benefits of the
proposed transactions, including future financial, tax, accounting
treatment, and operating results. Many of these factors that will
determine actual results are beyond Melinta’s ability to control or
predict.
Other risks and uncertainties are more fully described in our
Annual Report on Form 10-K for the year ended December 31, 2016, as
amended by Form 10-K/A, filed with the SEC on April 13, 2017, and
in other filings that Melinta makes and will make with the SEC in
connection with the proposed transactions, including the proxy
statement described below under “Important Information and Where to
Find It.” Existing and prospective investors are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date hereof. The statements made in this press
release or presentation speak only as of the date stated herein,
and subsequent events and developments may cause our expectations
and beliefs to change. While we may elect to update these
forward-looking statements publicly at some point in the future, we
specifically disclaim any obligation to do so, whether as a result
of new information, future events or otherwise, except as required
by law. These forward-looking statements should not be relied upon
as representing our views as of any date after the date stated
herein.
No Offer or Solicitation:
This press release is being provided for informational purposes
only and does not constitute (i) an offer to purchase, nor a
solicitation of an offer to sell, subscribe for or buy any
securities, (ii) an offer to exchange any securities or (iii) the
solicitation of any vote for approval of any transaction. There
shall not be any offer, solicitation, sale or exchange of any
securities in any state or other jurisdiction in which such offer,
solicitation, sale, or exchange is not permitted.
Participants in this Transaction:
Melinta and certain of its directors and executive officers may
be deemed to be participants in the solicitation of proxies from
Melinta’s stockholders in connection with the proposed
transactions. Additional information regarding persons who may,
under the rules of the SEC, be deemed to be participants in the
solicitation of Melinta stockholders in connection with the
proposed transactions, and a description of their direct and
indirect interest, whether as security holders, directors or
employees of Melinta or otherwise, which may be different from
those of Melinta’s stockholders generally, will be set forth in the
definitive proxy statement filed with the SEC in connection with
the proposed transactions. You can find information about Melinta’s
directors and executive officers in Melinta’s Schedule 14F-1 filed
with the SEC on October 24, 2017, as supplemented on November 16,
2017.
Important Information and Where to Find It
Melinta will file a proxy statement with the SEC in connection
with the proposed transactions. The proxy statement will be sent to
the stockholders of Melinta. Melinta stockholders are advised to
read the proxy statement when it becomes available, because it will
contain important information about Melinta, and the proposed
transactions. When filed, this document and other documents
relating to the proposed transactions filed by Melinta can be
obtained, free of charge, at the SEC’s website
(http://www.sec.gov), at the company’s website
(http://ir.melinta.com/), or by writing to the Secretary, Melinta
Therapeutics, Inc., at ir@melinta.com.
For More Information:
Media Inquiries:Amra Maynard(917)
302-2702Amra.maynard@inventivhealth.com
Lyn Baranowski(203) 848-3346 news@melinta.com
Investor Inquiries:John Bluth(984)
209-4534jbluth@melinta.com
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