Ziarco Pharma is looking to sell up one month after posting mixed data from a Phase IIa clinical trial of its lead candidate, according to Bloomberg. The British dermatology specialist, which lists Amgen ($AMGN) and Pfizer ($PFE) among its investors, is reportedly working with a financial advisory firm to drum up interest in a buyout ahead of its anticipated advance into Phase IIb.
Sandwich, U.K.-based Ziarco, which was birthed in Pfizer’s exit from that same town, said last month that it intended to raise a Series C round to fund the advance of small molecule, selective histamine H4 receptor antagonist ZPL-389 into a Phase IIb trial. Ziarco outlined the strategy following the release of top-line data from a Phase IIa study. That trial missed its primary endpoint but succeeded against another measure that Ziarco plans to make the focal point of the upcoming larger trial.
The go-alone strategy put forward by Ziarco Executive Chairman Mike Grey, who told FierceBiotech the plan was to build on the $33.1 million Series B by adding new investors, is now reportedly just one of the options being considered by the company. Ziarco has reportedly started working with financial advisory firm Rothschild & Co to see whether it can land a buyout bid that meets its valuation of its business.
One of the anonymous sources quoted by Bloomberg put the potential value of the deal at upward of $1 billion when milestones and royalties are taken into account. Given that lead candidate Ziarco’s ZPL-389 is yet to enter Phase IIb and missed the primary endpoint in its previous mid-stage study, a savvy shopper is likely to load the deal with milestones and royalties--while minimizing the size of the upfront payment--to mitigate the risk that the drug will never make it to market.
Whether anyone is willing to meet the $1 billion valuation mooted in the article--or it proves to be an overly-optimistic marker leaked by someone involved in flogging the firm--remains to be seen. The Bloomberg article makes no mention of potential buyers. Ziarco already has connections to several drugmakers. As investors in Ziarco through their VC arms, Amgen and Pfizer--plus Lundbeck and ALK-Abello backer Lundbeckfond Ventures--have viewed the progress of Ziarco from front row seats.
- read Bloomberg’s piece