For months now, Nordic Nanovector has been on the hunt for any salvation that could stave off financial ruin after facing persistent clinical obstacles. And it appears that the company may have found a worthy life preserver.
The biotech is buying up APIM Therapeutics, a fellow clinical-stage, Norway-based oncology company that has a lead candidate in phase 1/2 and phase 2 trials, the Nordic announced Thursday.
The financials are broken out into three phases: first, Nordic is buying just over $43 million worth of APIM shares (439 million Norwegian kroner) and subsequently raising $5.4 million by exercising existing warrants from APIM shareholders. Nordic is then selling hundreds of millions of its own stock as consideration shares. When the dust settles, Nordic will have acquired 100% of APIM, with APIM shareholders owning 76% of the new company’s shares compared to 24% for Nordic shareholders. The combined company is expected to have enough cash to last into 2024.
In a release, Nordic said the merged company will eventually have a new name with the hope that it can retain its public listing on the Oslo Stock Exchange.
APIM CEO Kostas Alevizopoulos will lead the new venture alongside Nordic’s R&D team. Nordic’s interim CEO and CFO Malene Brondberg will join the joint company’s board of directors, which will be chaired by current Nordic chairman Jan Egberts. APIM chairman Erlend Skagseth, board member Gökhan Batur and a third member that will be nominated by APIM’s top four shareholders will also join the board of the newly merged biotech.
The acquisition marks the end of Nordic’s brutal corporate losing streak defined by the winding down of its PARADIGM trial in July. The phase 2b study was assessing Nordic’s lead antibody-radionuclide conjugate Betalutin in patients with refractory follicular lymphoma but enrollment had ground to a halt, due in part to the COVID-19 pandemic. After culling Betalutin, layoffs and restructuring ensued. Nordic now has eight full-time employees and a slimmed-down leadership team, as evidenced by Brondberg’s joint roles.
The demise of Betalutin also spurred the company to go on the M&A hunt. In a call with investors Thursday, Egberts said Nordic and its partner Carnegie Investment Bank had discussions with more than 25 potential contenders, with a primary focus on Norwegian oncology companies like itself. Maximizing shareholder value was paramount, said Egberts, who conceded that Nordic was failing in that department going into negotiations.
“As the Americans always joke, ‘The market never lies,’” the chairman said.
But buying APIM immediately puts Nordic back in the clinical saddle. The company’s lead asset ATX-101, a peptide targeting proliferating cell nuclear antigen, is in a phase 1/2 trial for patients with platinum-sensitive ovarian cancer and a phase 2 trial for sarcoma patients. Two more studies, in patients with platinum-resistant ovarian cancer and glioblastoma, respectively, are slated to start in the second half of 2023.
In terms of potential partnerships, Alevizopoulos said the company is in the process of presenting previous phase 1 data of ATX-101 that displayed a positive safety profile to investors and pharmaceutical companies.
“This mechanism has traditionally generated a lot of interest with pharma because it is exactly a mechanism which is totally new,” he said. “Having said that, a total new mechanism of action always generates some skepticism in the sense that pharma would like to see additional data. This is the exact data we are generating right now.”
That doesn’t mean that Nordic is going to drop all of its existing ambitions. The company says it will continue to evaluate “the most optimal way” to generate value from its existing CD37-targeting pipeline.